Government and private support should see Cote d'Ivoire's palm oil industry expand in 2017

Côte d’Ivoire is West Africa’s second-largest palm oil producer after Nigeria and eighth largest overall. After annual production fell from 415,900 tonnes in 2010 to 360,000 in 2012, the country has successfully stabilised its annual production at around 400,000 tonnes per year, with local news reporting that the industry is worth CFA550bn (€825m) and affects upwards of 2m Ivorians. The government intends to further boost this industry, largely dominated by small village plantations responsible for up to 60% of the country’s production, through the National Agricultural Investment Programme (Programme National d’Investissement Agricole, PNIA). Launched in 2016 for the 2016-20 period, the PNIA aims to increase production from around 400,000 tonnes per year to 600,000 tonnes.

As the fourth-highest income generator in the Ivorian economy, the palm oil industry is poised for growth over the next few years, thanks in large part to the government’s 2016-20 PNIA. Home to Africa’s largest palm oil refinery, Côte d’Ivoire’s palm oil industry is primarily driven by small producers located in villages as opposed to Indonesia or Malaysia, where large-scale industrial plantations are common. Through investments from the government, Côte d’Ivoire’s palm oil industry will be able to significantly expand production and continue exporting to neighbouring countries, a market very much in demand given oilseed shortages.

Domestic Production

Around 60% of Côte d’ Ivoire’s palm oil comes from small village plantations. Ranging in size from 3-5 ha, small plantations are a strong source of sustainable employment for Ivorians. The sector itself is said to account for upwards of 2m jobs, including employment opportunities for women, who are typically hired for the harvesting, processing and marketing of palm oil. The remaining 40% of production is handled by large-scale industrial groups, which are able to produce almost double the tonnage per ha than small producers. Such industrial groups include Dekeoil and SIFCA. SIFCA is one of the largest producers of palm oil in West Africa. Its local subsidiary, PALMCI, holds 39,000 ha of land for industrial palm oil production and oversees and supports another 27,000 cultivators across 133,000 ha of small village plantations, enabling it to account for the production of up to 300,000 tonnes of palm oil per year.

Pnia Impact

Though the PNIA should impact Côte d’Ivoire’s domestic production of palm oil by increasing output to 600,000 tonnes annually, it remains unclear whether this will privilege large-scale industrial production over the more typical and traditional small-scale village production. Authorities nevertheless view palm oil as a fundamental cog in its master plan to achieve food security in the country. Indeed, not only does the palm oil industry generate a multiplicity of jobs for both men and women, as well as guarantees a relatively steady income for producers while taking up minimal land space, palm oil is also a household staple in Côte d’Ivoire and across the world, where it is used by almost every major food manufacturer. According to local private-public partnerships agro-business company, Agrismart, the average consumer in Côte d’Ivoire consumed the equivalent of 10 km of palm oil per year. Beyond the domestic implications that will come with boosting the palm oil industry, there are regional implications that the country’s palm industry could benefit from. Côte d’Ivoire already exports approximately 55% of its national oilseed production, while its internal domestic market consumes 45%.

West African neighbouring countries are largely deficient in oilseeds. The deficit in oilseeds, estimated at over 2m tonnes according to local media reports, represents an opportunity for Côte d’Ivoire’s palm oil industry. The government, which reportedly expects to mobilise upwards of CFA2trn (€3bn) over the next five years for the PNIA, has already received a significant amount of support from the UN’s Food and Agriculture Organisation, and is expecting to attract a greater number of foreign investors in the coming years.

 

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The Report: Côte d'Ivoire 2017

Agriculture chapter from The Report: Côte d'Ivoire 2017