Value chain analysis Nigeria ginger

Nigeria has been selected due to its important trade position in Africa, but also its urgent need to professionalise sectors to improve the quality of services and products. In 2019-2020, a Value Chain Selection (VCS) was conducted to assess potential sectors to improve in Nigeria. The five most interesting value chains for a potential CBI project or multiple projects in Nigeria were identified. From a CBI shortlist, ginger, cocoa and shea were finally selected to develop an initial Business Case Idea (iBCI). This iBCI has been followed up with virtual interviews with key stakeholders. The Ginger iBCI has been approved to continue to the VCA phase.

According to FAOSTAT (2018), Nigeria is the third-largest producer of ginger in the world (after India and China). Nigerian ginger is among the best in the world, with its aroma, pungency and high oil and oleoresin content as distinct features. The main producing zone is Kaduna state, and to a lesser extent Nasarawa, Niger, Gombe, Bauchi, and Benue. Nigeria could use ginger to position itself in different ways on the domestic, regional and EU markets. On the EU market, there is scope to expand Nigeria’s current fresh and dried ginger exports, by focusing among others on quality improvements and meeting the mandatory EU market requirements, as well as exploring opportunities for certification and gaining access to niche market segments. In the EU, healthy and cosmopolitan lifestyle dishes, drinks, snacks and food supplements – in which ginger is a key ingredient – are experiencing increasing popularity. Another specific trend from which Nigeria can benefit especially is the fact that European demand peaks in wintertime, when supply is low and prices are high. Nigeria, being a country with year-round ginger production, can offer a constant supply to meet such demand.

However, the Nigerian ginger sector has been facing serious difficulties over the past years: low yields, high post-harvest losses, a lack of tech and of infrastructure (and know how) to improve processing and product quality, fierce competition from Asia, price fluctuations, poor organisation and an ineffective enabling institutional environment. The VCS noted that there is nevertheless significant potential for value addition and room for CBI intervention. Some of the points noted were related to improving farming techniques, quality management and certification, investment in cold storage, investments in advanced processing equipment, and product marketing. CBI has therefore invited SureChain to conduct a value chain analysis for Nigeria’s ginger sector. The objective of the assignment is to conduct a value chain analysis in the ginger sector and provide key insights for CBI to design a project related to ginger. The sub-objectives are:

• Enabling sector transition: What is needed to professionalise the ginger sector and bring more benefits to Nigeria? What is a sustainable sector according to key stakeholders? How can a sustainable sector be set up?
• With the analysis, creating a deeper understanding of obstacles and opportunities in the value chain. Relevant stakeholders in the SME export sector and the export enabling environment will also be determined.
• Validating and using the findings to establish a more detailed project results chain.

Given the situation with COVID-19, data gathering was primarily the result of desk research and online interviews with stakeholders. On-the-ground visits to some ginger-producing factories were made on a best effort basis.

The report is divided into four chapters, followed by a conclusion and annexes. Chapter 1 presents a brief research approach, Chapter 2 presents information regarding the initial product market combination analysis, Chapter 3 presents the value chain analysis of dried ginger in Nigeria, while Chapter 4 provides information in support of CBI ginger value chain project design and risk assessment.