Soybean

Soybean is an important cash crop cultivated across northern Nigeria. The Nigerian soybean market has witnessed some growth over the years, largely driven by the increasing demand for soymeal in the animal feed sector, especially for poultry and fish feed. Despite the increasing demand for soybean by industrial processors, the producers/ small farmers have remained the least benefited due to their lack of exposure to a wide range of buyers, access to market price information and lack of capacity to aggregate in bulk. Middlemen play the critical role of bridging this gap between producers and consumers (processing plants) and hence gain a higher bargaining power particularly over the small farmers, often leaving the latter discouraged to continue with soybean cultivation. Women play a significant role in soybean production, which has driven Propcom Mai-karfi’s (PM) interest in the sub-sector.

Our Interventions

In 2012, Propcom Mai-karfi commenced building direct linkages between processors and producers to reduce the number of intermediaries, information asymmetry and the bargaining power of middlemen in the supply chain. This would ensure higher income for soybean farmers, motivation for them to expand production, and increased control over quality and profits for processing companies.

Karma Foods: In 2012/2013, Propcom Mai-karfi partnered with soybean processor Karma Foods to pilot a direct procurement model, allowing the company to establish a consistent supply source of soybean in large quantities. Karma Food’s field executives registered a total of 6,444 farmers from 18 local government areas in Kaduna and Niger states. By March 2013, Karma’s field executives had procured a cumulative 997MT of soybean in both states. The value that was previously enjoyed by middlemen was shared between the company and the farmers, resulting in increased profits and cost savings for both. Farmers who sold to Karma Foods earned a total additional net income of about NGN6 million. Karma also saved about NGN10 million from buying directly from farmers according to the project’s estimates. In 2012/2013 Karma Foods had intended to directly procure soybeans from at least 60% of registered farmers at a total estimate of 3,583MT. However, the pilot revealed that despite initial commitment from Karma, unforeseen elements such as lack of trust in newly recruited field executives and resistance to change within the procurement division made direct procurement and continuing with the partnership a challenge. Propcom Mai-karfi exited the soybean sector in 2013.

ABJ Nigeria Ltd: In 2015 Propcom Mai-karfi reentered the soybean sector in partnership with ABJ. Propcom Mai-karfi is supporting soybean processor ABJ to pilot a direct procurement model, allowing the company to establish a consistent supply source of soybean in large quantities. ABJ currently has a milling capacity 500MT/day but is only able to source about 200MT of soybean per day. The partnership is building the capacities of women’s groups to produce premium soybean grains which ABJ will buy back. Under the intervention a scoping study has been completed and prime locations for the programme identified. Field officers for ABJ have been trained on good agricultural practices (GAP) for soy production so that they can support the establishment and monitoring of demonstration plots. Demonstration events and trainings have also been held in the pilot state of Kaduna. It is expected that as a result of this intervention, networked women farmers will adopt GAP to improve their yield, ABJ will have access to increased quantity of soybeans, and the farmers will have access to a premium market with ABJ.

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