Nigeria May Lose 40% Of Annual Cocoa Output To Rainfall- FDC

Nigeria may lose 40 per cent of annual output to excessive rain in the South Western region of the country.

Lagos based Financial Derivatives Company disclosed this in a report.

Nigeria is Africa’s third largest cocoa producer.

“As much as 40 per cent of Nigeria’s annual cocoa output is under threat from excessive rainfall in South West Nigeria,” Financial Derivatives Company said.

Nigeria, which is also the world’s fourth largest producer of cocoa, accounts for 328,263 metric tons annually.

Based on FDC projection, Nigeria may lose 131,305 metric tones to the disaster.

FDC said cocoa farmers are unable to dry a significant part of their harvest while the black pod disease, which thrives in damp conditions continue to attack the commodity.

The country already has a negative balance as the development could put further pressure on Nigeria’s trade balance, FDC said.

The financial advisory firm said the development may further lead to devaluation of the naira in the forex market.

Cocoa prices have declined by 0.30 per cent in 2020 due to the coronavirus pandemic to $2,686 per metric tone.

The two world largest producers, Ghana and Ivory Coast have failed to support global prices of the commodity, despite price hike.