Nigeria’s cocoa industry, long positioned as a cornerstone of the country’s non-oil export diversification strategy, is facing renewed policy uncertainty after farmer organisations publicly questioned the unexplained disappearance of a flagship legislative proposal meant to reshape the sector’s governance architecture.
Cocoa farmers’ groups in Nigeria have called on President Bola Tinubu to clarify the status of the National Cocoa Board Establishment Bill, which was submitted to the National Assembly in November 2025 before being withdrawn for amendments without subsequent public updates.
In a joint open letter, the Cocoa Farmers Association of Nigeria (CFAN) and the Cocoa Farmers Alliance Association of Africa (COFAAA) warned that the lack of transparency surrounding the bill is generating uncertainty not only within the agricultural sector but also among investors monitoring Nigeria’s commodity policy direction. They argue that clarity on the legislation is important for sustaining confidence in economic reforms aimed at strengthening non-oil exports and institutional credibility.
Although the cocoa board debate may seem confined to the agricultural sector, analysts argue it reflects a familiar pattern in the country’s political economy, where strong reform announcements are sometimes followed by limited administrative clarity, creating challenges for long-term investment planning
Cocoa remains one of Nigeria’s most valuable agricultural exports, generating foreign exchange, supporting millions of rural livelihoods and offering a potential hedge against volatile oil revenues.
Nigeria ranks behind Côte d’Ivoire and Ghana , the world’s dominant cocoa producers, but retains significant expansion potential due to available arable land, a growing domestic processing industry and increasing global demand for ethically sourced cocoa products.
From a policy perspective, strengthening cocoa governance aligns with Nigeria’s objectives of export diversification, rural income enhancement and climate-resilient agricultural development. The proposed Cocoa Board is commonly interpreted as an institutional intervention intended to address structural deficiencies within the sector, including fragmented marketing arrangements, variable quality standards, underdeveloped traceability systems, constrained farmer financing and limited research and extension capacity.
Farmers’ groups say the Board was conceived primarily as a coordinating institution rather than a price-fixing or commodity-purchasing agency, an important distinction in a country wary of state trading monopolies after mixed historical experiences. Yet the apparent legislative limbo has introduced new uncertainty at a moment when global cocoa markets themselves are undergoing significant developments.
Global cocoa volatility heightens stakes
International cocoa prices rose during 2024 before retreating amid improved supply expectations and shifting speculative activity. The resulting volatility has sharpened policy debates across producing countries about institutional support mechanisms for farmers.
In West Africa, which produces roughly 70 per cent of the world’s cocoa, governments are increasingly prioritising sustainability compliance to meet European Union import regulations, strengthening traceability systems to address deforestation concerns, improving productivity through enhanced seedlings and agronomic practices, and developing mechanisms to stabilise prices.
Côte d’Ivoire and Ghana already operate structured cocoa boards that coordinate marketing, quality assurance and export logistics. Although their models differ (Ghana’s COCOBOD being particularly interventionist), both provide institutional continuity that investors and multinational buyers generally understand.
Nigeria’s absence of a comparable central coordinating body has long been cited as a constraint on scaling production and attracting processing investment.
“The institutional framework matters as much as farm yields. Without predictable governance, capital flows elsewhere even when agronomic conditions are favourable,” says Tunji George, a Lagos-based commodities economist.
According to farmer associations, the proposed Cocoa Board Bill followed an unusual legislative path, having been transmitted from the presidency to the Senate in early November 2025, introduced shortly afterward in the House of Representatives, withdrawn within days for amendments, and then followed by several months of official silence.
This sequence has created what stakeholders describe as a mismatch between political messaging and legislative reality.
Farmer representatives argue that public references to the cocoa board as an achievement of the current administration , despite the bill not having passed, risk undermining credibility among producers, exporters and development partners who depend on regulatory clarity.
Financing constraints and institutional vacuum
Access to finance remains one of the most persistent challenges facing Nigerian cocoa farmers.
Unlike Ghana, where the cocoa board facilitates syndicated financing backed by forward sales contracts, Nigerian farmers often depend on informal credit networks, trader pre-financing arrangements, and short-tenor commercial loans that typically carry relatively high interest rates.
Industry participants argue that a functioning cocoa board could improve creditworthiness through sector aggregation, support warehouse receipt systems, standardise quality certification, and enhance the reliability of export contracts.
Without such institutional scaffolding, smallholder farmers,who dominate Nigerian cocoa production, face structural disadvantages in global value chains increasingly oriented toward sustainability certification and traceability compliance.
European Union deforestation regulations and corporate environmental commitments are reshaping global cocoa sourcing requirements, with buyers increasingly demanding detailed data on farm locations, production practices, labour standards and environmental impact metrics.
Countries with coordinated cocoa boards have moved faster in developing national traceability frameworks. Nigeria, by contrast, relies on a patchwork of private sector initiatives, donor programmes and state-level interventions.
Industry observers say the proposed board was expected to centralise sustainability compliance systems, coordinate farmer training programmes, strengthen research institutions, and align national standards with international certification regimes. The absence of legislative clarity complicates planning for exporters seeking to maintain access to premium European markets.
Nigeria has long aspired to increase domestic cocoa processing capacity to capture more value locally rather than exporting primarily raw beans. Several multinational processors already operate in the country, but expansion decisions hinge heavily on policy predictability.
Potential investors consider factors such as export logistics efficiency, regulatory consistency, the availability of certified beans, financing frameworks for farmers, and long-term government commitment.
A credible cocoa board, analysts assert, could function as a signalling mechanism that Nigeria intends to compete more aggressively in value-added segments such as cocoa butter, liquor and powder production. The current legislative uncertainty risks delaying those investment decisions.
Farmer organisations have also highlighted falling international cocoa prices as an immediate concern. Lower prices, combined with rising fertiliser costs and climate-related production challenges, threaten rural incomes.
Nigeria’s cocoa sector consists predominantly of smallholder farmers cultivating relatively small plots, often with ageing trees and limited access to modern agronomic inputs. Stakeholders believe institutional support, whether through extension services, research funding or coordinated marketing, can significantly influence productivity and income stability.
Without a clear governance framework, stakeholders fear declining farmer participation, reduced replanting investment, increased rural poverty pressures, and a potential shift to alternative crops, dynamics that could undermine Nigeria’s medium-term export diversification goals.
The cocoa board debate unfolds against a backdrop of economic reforms under President Tinubu, including fuel subsidy removal, exchange rate liberalisation, fiscal consolidation efforts, and a renewed emphasis on non-oil exports, with agricultural commodities central to these diversification ambitions; cocoa, along with cashew, sesame, and rubber, has been identified as a sector capable of generating substantial foreign exchange, though the credibility of reforms depends not only on macroeconomic adjustments but also on sector-specific institutional follow-through.
Farmer associations emphasise that their primary concern is not necessarily the delay itself but the absence of transparent communication. Major legislation typically undergoes consultation, revision and negotiation. Yet prolonged silence can create speculation ranging from bureaucratic bottlenecks to political reconsideration.
The cocoa board debate unfolds against a backdrop of sweeping economic reforms under President Tinubu, including fuel subsidy removal, exchange rate liberalisation, fiscal consolidation efforts, and a renewed emphasis on non-oil exports, with agricultural commodities central to these diversification ambitions; cocoa, along with cashew, sesame, and rubber, has been identified as a sector capable of generating substantial foreign exchange, though the credibility of reforms depends not only on macroeconomic adjustments but also on sector-specific institutional follow-through.
West Africa’s cocoa sector is increasingly competitive, not only in production volumes but also in regulatory sophistication. Côte d’Ivoire has invested heavily in traceability and sustainability compliance. Ghana continues to leverage its cocoa board to secure financing and manage marketing. Emerging producers such as Ecuador and Indonesia are also upgrading institutional frameworks to capture higher-value segments.
Nigeria’s relative institutional fragmentation risks limiting its competitive position unless reforms materialise.
In their letter, CFAN and COFAAA outlined four principal requests to the Nigerian government: clarification of the bill’s current status and legislative trajectory, an explanation of discrepancies between public claims and actual legal progress, support for timely review and resubmission of the legislation, and a reaffirmation of the federal commitment to strengthening cocoa sector institutions. They argue that the proposed board could unlock significant economic potential while improving farmer welfare and attracting investment.
The future of the Cocoa Board Bill remains uncertain, and analysts sketch out several possible trajectories. They project that it might experience a revival, returning to the legislative agenda and rekindling investor confidence. On the other hand, bureaucratic delays could stretch indefinitely, stalling modernisation efforts. The government could also opt for a policy redesign, implementing alternative institutional arrangements outside the original framework. A more pessimistic scenario, still possible, is the quiet abandonment of the bill, signaling a retreat from structured commodity governance. Ultimately, each outcome carries material consequences for Nigeria’s export earnings, rural incomes, and diversification strategy.
