Banks challenged on financing for Nigeria’s N100bn cold chain industry 

By Samson Echenim

Operators and investors in Nigeria’s cold chain sector, have charged banks and other investment financiers to invest in the cold chain industry, whose value is put at a minimum of N100 billion, to reduce agricultural waste and ensure sustainability of healthy foods for Nigerians.

Gathering under the aegis of Organisation for Technology Advancement of Cold Chain in West Africa (OTACCWA) at a forum in Lagos on cold chain infrastructure financing in Nigeria, stakeholders and investors said the cold chain industry presented a new investment frontier for saving Nigeria’s N12 billion worth of agricultural produce wasted annually, while creating millions of jobs and ensuring sustainable production of healthy foods for Nigeria’s teeming population.

Tunde Okoya, vice president of OTACCWA, said a huge investments, reaching N100 billion in monetary value, is needed to build cold stores at major farm gates and markets across the country, as well as acquire cold trucks for moving the produce to markets.

Delivering his speech titled, “Harnessing Renewable Alternative Energy Sources for Off-grid Cold Chain Development in Nigeria,” Okoya said investments were also needed to build alternative energy sources such as greenchill, which uses biomass-wastes from farm, cow dungs, to power massive cooling and ripening equipment.

According to him, Nigeria needs about 200,000 cold stores across the country and thousands of cold trucks to kick start a cold chain sector that will ensure food safety and security in the country in the next few years.

He said, “With the support of Global Alliance for Improved Nutrition (GAIN), we carried out a mapping of the cold chain infrastructure in Nigeria, and during that mapping for a few local government areas in Lagos alone, we captured a total of 250,000 cubic metres of cold chain space available. India has about 350 million cubic metres of cold chain space. Also South Africa, Kenya and other countries in Africa have capacities that run into tens of millions of cubic metres cold chain space.

“For a country like Nigeria, considering its size and population, we should have at least 250 million cubic metres of cold chain space and that will translate to about 200,000 cold stores and hundreds of thousands of cold trucks. We are talking about processors for poultry, for milk, for different kinds of fruits and vegetables that need to be preserved to ensure their availability throughout the year.

“With the right support, the right collaboration, this industry is easily about N100 billion and it involves many key players. You have the chemicals industry that will supply chemicals needed for refrigeration; you have the original equipment manufacturers (OEMs) that supply the compressors for the cold stores.”

He said there are many key players in the cold chain sector, adding that the sector would need strategic policies as catalysts to spur up an untapped massive employment creating sector.

“So, we are looking at the cold chain as a sector, not just an industry. It is a sector, just like automobile, manufacturing and the likes. It is when we start looking at it from the perspective of being a sector that we can now be able to come up with the required strategic policies to drive it. Key elements include food safety, food security and improved nutrition,” he told Business a.m on the sideline of the event.

“Why do we have only two or three big poultry processors? Why can’t we have community processors, so that in any part of the country, poultry product is easily available? Our poultry farmers can’t process their product to sell at a later date because there is no storage,” the OTACCWA chief noted.

On banks seeming unwillingness to invest in the sector, he said, “I will say we are not going to play a blame game. It is about collaboration; it is about convincing them that this is a business that will work. It is about financial hustling. So we have to organise ourselves properly, which is our aim at OTACCWA and then we can go to the banks.”