Growing and Processing the Nigerian tomato (Part 1)

It's always exciting to be in Nigeria during the harvest period, which could be during the dry or wet season. It’s not only exciting because of the opportunities that seem to always present themselves across a wide array of fresh produce, it is so, because of the distribution opportunities across the massive population. The opportunity for preservation.

Local entrepreneurs during this period get all worked up with ideas on what can or should be done. Their solutions ranges from preservation, refrigeration with solar, to many more futuristic ideas, they could come up with. This they do with one goal in mind, to increase the shelf life of the produce, to avoid waste, to compete with imports etc. This they hastily assume as a massive untapped opportunity without understanding the basic economics of processing perishables, beyond the distribution that simply doesn’t exist in nigeria.

The Nigerian tomato for example, is notorious for high water content, and its fragility; it perishes within a few days after harvest. Nigerian farmers produce an estimated 1.7 million metric tons of tomatoes annually over two seasons. The dry season, which spans from January to April, where there is usually the mirage of glut; then during the wet season, which stretches from April to September were fewer tomatoes are grown.

A little bit of background. 3 years ago we decided to grow fresh tomatoes in south west Nigeria in greenhouses using fertigation over 3 acres of land as a pilot. We imported all the equipments we needed, the technology, and even the seeds. We successfully setup the farm in record time, but we still failed. We did not fail because we couldn’t sell our produce for close to nothing during dry season, we failed because, the numbers simply didn’t add up. We simply couldn’t run a sustainable business that is seasonal. The seasonality of tomatoes as a produce means, that at a point in time, there is a significant supply of tomatoes in the market, and anybody producing expensive tomatoes, i.e that which is grown in greenhouses, simply would record losses during those period. A greenhouse setup means you simply cannot also cut back on production, as your running costs does not change.

But let's not get distracted by talking about growing tomatoes year round, lets get into the facts on producing tomato paste, using Nigerian tomatoes.

The key players that produce tomato paste through backward integration are Erisco which produces Ric Giko, Olam, which produces Tasty Tom, Chi Ltd, which produces Peppe Terra, Noclink Ventures, which produces Taima, Tomavita, and Tomato Fun, which produces Gino and Watanmal, which produces Pomo tomato paste.

One would think that with this number of large players in the tomato paste space, Nigerian entrepreneurs would take a clue on the economics of processing fresh produces through local supply, but unfortunately that's not the case.

Here is what we need to know about processing tomatoes using local produce in Nigeria. To be continued…