Cocoa Beans is the dried and partially fermented fatty seed of the cacao tree from which chocolate is made. Cocoa can generically refer to cocoa powder, the dry powder made by grinding cocoa seeds and removing the cocoa butter from the dark, bitter cocoa solids; or it may refer to the combination of both cocoa powder and cocoa butter together.

Cocoa beans is one of the leading export commodity in Nigeria and rising international market prices for cocoa have continued to encourage Nigerian farmers to rehabilitate abandoned farms and also increase area under production.

There are 14 cocoa producing states in Nigeria and a total planted area of 640,000 hectares. Annual production has fluctuated between 250,000 and 320,000 tons over the past five years.

About 85 percent of total cocoa production is exported as cocoa beans while the remaining 15 percent is processed locally into butter, liquor, powder and cake before being mostly exported.

cocoa can be processed into Cocoa Liquor, Cocoa Butter and Cocoa Powder.

Cocoa Liquor

Cocoa liquor, also known as chocolate liquor and cocoa mass, is a smooth liquid form of chocolate. It contains both cocoa solids and cocoa butter in roughly equal proportion. It is produced by taking cocoa beans that have been fermented, dried, roasted, and separated from their shells and grinding their center, the cotyledon. The chocolate liquor can then be cooled and moulded into blocks known as unsweetened baking chocolate. The liquor and blocks contain roughly 53 percent cocoa butter. Chocolate liquor contains no alcohol.

Cocoa Cake

Cocoa cake is the intermediate cocoa solids usually produced by hydraulic pressing after removing the bulk of the fat (cocoa butter) from loaded cocoa liquor. The first action is the breaking up of the cake, initially in sizable hard discs, into much smaller pieces by passing them through rotating toothed rollers. Most processors sell the resultant small lumps as ‘Kibbled’ cake. Kibbled cake can be pulverised and turned to cocoa powder by the process of grinding.

Cocoa Butter

Cocoa butter, also called theobroma oil, is the pale-yellow, edible natural vegetable fat of the cacao bean. Cocoa butter is extracted from the cacao beans and can be used to make chocolate, cocoa powder, pharmaceuticals, ointments, and toiletries. Cocoa butter has a mild chocolate flavor and aroma. During processing of the cacao bean, cocoa powder and cocoa butter are separated out at an early stage.

The two are recombined in the manufacture of regular (brown) chocolate bars. The confectionery known as white chocolate contains cocoa butter but not cocoa powder. Cocoa butter has a melting point of around 34 to 38 degrees Celsius (93 to 100 degrees Fahrenheit), rendering chocolate a solid at room temperature that readily melts once inside the mouth. Because of the melting temperature of cocoa butter, it is often used in pharmaceuticals as a base for suppositories.

It is able to be stored at room temperature, but readily melts at body temperature, releasing the medication. Cocoa butter is one of the most stable fats known, containing natural antioxidants that prevent rancidity and give it a storage life of two to five years, making it a good choice for non-food products. The smooth texture, sweet fragrance and emollient property of cocoa butter make it a popular ingredient in cosmetics and skin care products, such as soaps and lotions.

Cocoa Powder

Cocoa solids is a term for the non-fat component of liquor. It may also be called cocoa powder when sold as an end product. The fatty component of liquor is cocoa butter. The separation of the two may be accomplished by a press, or by the Broma process. Cocoa solids is what lend a chocolate bar its characteristic flavor and color, while cocoa butter is what provides smoothness and a low melting point. Cocoa powder is the last product in the secondary phase of the cocoa processing chain. It is derived from cocoa cake which is pulverized to become powder. There are two variants of cocoa powder.

These are natural cocoa powder and alkalized cocoa powder. The alkalized cocoa powder is obtained after the introduction of an alkalizing agent (sodium carbonate) at the nib stage during processing. The whole essence of introducing an alkalizing agent is to reduce the acidity of the powder in its natural state. The natural cocoa powder, just as its name implies, is without any alkalization. Both products are used in varying degrees in the production of cocoa based consumer products: Cocoa based beverage drinks, biscuits, chocolates etc.

Cocoa powder is usually chocolaty in colour. It is dry and in fine powder form. It is usually packed in 4 ply kraft paper bags with inner polythene lining. Cocoa solids are what contain most of the antioxidants associated with chocolate. Accordingly, health professionals recommend consuming chocolate in forms that are high in cocoa solids while low in cocoa butter, such as hot cocoa.

Domestic consumption of cocoa products is very insignificant and consists almost exclusively of cocoa powder used in breakfast beverages.

There are about 17 cocoa processing companies in Nigeria. Of the 17, only nine are functional and out of the nine, only two are owned by foreigners. The irony however is that up to 90% of the high-level exporters of raw Cocoa from Nigeria, are foreigners.

Government gives Export Expansion Grant of up to 30 per cent to processors of cocoa beans on their export turnover. But the truth is that the exporter of raw cocoa gets 10 per cent on turnover as an incentive under the same Export Expansion Grant; and he is able to do three transactions for every one transaction done by the processor of the cocoa beans. In the long run, both the processor and the exporter of raw cocoa beans are getting the same 30 per cent from government.

Between 1962 and 1968, Nigeria’s major foreign exchange earner was the agricultural sector. However, even though trade was liberalized during this period, agricultural exports declined and the sector did not benefit from the relaxed trade environment. Thus the kind of liberalization at that time (which favoured import substitution and consumption of foreign made goods), reduced the threat that an expanding agricultural exports sector may have had on the environment.

Nigeria realized $882,812,813 from the exportation of Cocoa and cocoa products in 2010, as against $662,295,907 realized in 2009.

Nigeria is third largest cocoa grower in Africa and producing about 400,000 MT of the commodity.

Global production of cocoa is concentrated effectively in the regions between 10° North and 10° south of the Equator. Traditionally, cocoa is cultivated in producing countries and sold for export in the form of beans. Importing countries then process the beans, transforming the raw goods into finished or semi-finished products (cocoa butter, cocoa liqueur, cocoa powder, etc.). In recent years, in an effort to increase the value of exports, some producer countries, such as the Ivory Coast, Ghana, Nigeria and Brazil, have developed their own facilities for grinding beans.

World consumption is estimated at 2, 800,000 tons per year. The largest cocoa importers are Europe (more than 1.2 million tons per year) and the United States (0.4 million tons per year). The largest importers are Holland, the US, Germany, Britain and Brazil.

About 85 percent of total cocoa production is exported as cocoa beans while the remaining 15 percent is processed locally into butter, liquor, powder and cake before being mostly exported. Domestic consumption of cocoa products is very insignificant and consists almost exclusively of cocoa powder used in breakfast beverages.

However, local cocoa grinding is likely to increase marginally from the current 15 percent of total bean production to 16 percent in the next year due largely to expected increases in bean production and improved power supply for processors.
There are about 17 cocoa processing companies in Nigeria. Of the 17, only nine are functional and out of the nine, only two are owned by foreigners. The irony however is that up to 90% of the high-level exporters of raw Cocoa from Nigeria, are foreigners.

Nigerians who are in the business cannot in any way compete with these foreigners because the foreigners get bank facilities at about six per cent from banks in their home countries while Nigerians who are in the same business with them painstakingly obtain similar loans at about 22 per cent interest rate. Obviously, they do not enjoy a level playing field, yet get the same reprieve from exporting cocoa.

From the above, establishing a cocoa processing plant to meet local and international demand would be beneficial to the investor and nation.

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