1Image – Credit: Jam Beverage Company
Spices are a part of our daily lives and served different purposes. Apart from playing a huge role in adding flavour to dishes, they can also be used as raw materials for pharmaceutical production and skincare agents.
The global spice market was estimated to be worth $13.77 billion in 2019 and projected to grow at a compound annual growth rate (CAGR) of 6.3 % from 2020 to 2027 according to grandviewresearch.com.
The spice business industry is a multi-billion dollar global industry and has been a significant source of revenue for several African countries. Almost every African country produces spices but most of it is consumed locally. Vietnam (an Asian country) produces and exports over 30% of the world’s pepper. India and China dominate global ginger production and export. Nigeria and Cameroon are part of the top ten world producers of ginger.
Nigeria is the fourth largest grower of ginger with an estimated national output of 31,000 metric tons according to her Federal Ministry of Agriculture.
The presence of the pandemic has caused an increase in consumption of ginger and other herbs in a quest to boost the immune system. Experts have said that turmeric and ginger suppress various inflammatory molecules that cause harmful viruses owing to its anti-inflammatory component, Curcumin.
A lot of spices possess anti-oxidant properties and research has shown how helpful they are in the treatment of several ailments and health issues. Turmeric, for instance aids in prevention of illnesses like Alzheimers and joint inflammations. Turmeric can also be used for skincare and beauty products because of its skin brightening abilities and it is a common ingredient in skincare products and is widely used globally.
According to Florence Edwards, National President, Ginger Growers, Processors and Marketers Association in Nigeria, “Globally, people are now consuming more of ginger and other herbs due to the pandemic to boost their immunity”. She also said that “as a result, Nigeria is seeing a surge in demand for its ginger current since we have the spiciest variety globally”. This reveals the growing demand for ginger and other spices globally and the investment opportunities that can be harnessed.
Ginger and African black pepper are the major Nigerian spices in the International market. Black pepper is the largest traded spice worldwide, getting the highest amount per ton. It is followed closely by chilli pepper.
Most herbs can be consumed in different forms. There is a rising demand for a variety of ready-to-use spice mixes. Different flavours have been created to make food preparation easier and there are a large number of buyers globally who are willing to pay for these new flavours. This has fueled the growth in this industry. Furthermore, the roots of these spices also serve as raw materials for manufacturing health products and drinks.
According to data from the National Bureau of Statistics (NBS) Trade Report in Nigeria, the country has exported about N1.9 billion ($4,914, 952. 30) worth of ginger in the first three months of 2020. There are currently no records for garlic and turmeric production.
Despite the revenue opportunity in spice production, its value hasn’t been fully tapped as a result of low technological utilisation in the production of these spices. Rather than using advanced machinery and tractors, manual labour is heavily used by most farmers. There is also the issue of destructive methods of harvesting as local knives are still used to split harvested ginger rhizomes and turmeric. This has led to smaller scale of farming and in turn resulted in smaller output. The yield per hectare is quite low and increasing demands cannot be adequately met because of low production output.
Nigeria is blessed with good climate, abundant sunshine, rainfall and good soil for cultivation of most of these spices. These spices are not seasonal and are available all year round, regardless of the season. Despite these good conditions present for spice production, there is low production and export. Most of what is produced is also still locally consumed. The rate of local consumption is lower in comparison with export rate.
There is an array of opportunities for possible investors in this sector. There is a growing demand for exporting African spices and herbs, both now and in the future, coupled with the high demand for spice consumption within our local towns and cities.
There is also an increased market demand for spices in South Africa. According to the International Monetary Fund (IMF), the amount of spices imported into South Africa has almost doubled over the years. Perhaps one could delve into large scale spice production in Nigeria to be exported to South Africa.
The global food industry is rapidly evolving and the tastes of consumers is changing with it. This has caused an increased usage of spices in food products and thus increasing the global demand for spices. There should be focus on increasing the production of spices for global and even intercontinental export of spices, especially ginger as Nigeria is the fourth largest grower of ginger globally and weather conditions are favourable all year round.