How to Start a Cassava Flour Processing Factory Business

The Federal Ministry of Agriculture and Rural Development transformation agenda is setting out to create over 3.5 million jobs from a number of agricultural products value chains.

Cassava looms large in the list of the products which include rice, sorghum, cocoa and cotton. It therefore becomes timely to offer advice on how interested investors can invest in cassava processing. Investment justification The transformation agenda of the present government has given the flour mills operating in Nigeria three months ultimatum to comply with the directive that all the wheat flour produced and sold in Nigeria must contain 10 percent cassava flour. This has made the production of cassava flour lucrative in the country again.

It has been tested and passed that wheat flour containing 10 percent cassava flour produced very good bread and other confectioneries. In this regard, demand for cassava flour will be in hundreds of thousand metric tons annually as flour mills are now issuing Local Purchase Orders for supply of cassava flour.

Other incentives introduce by the government are: Tax rebates for bakers and flour mills utilising cassava flour and zero percent tariff for cassava flour manufacturing machines. In addition to this, government has increased the tariff on wheat flour to 40 percent. This is aimed at making cassava flour price to be competitive enough.

The raw materials for the production of cassava flour are readily available in Nigeria. Nigeria is the largest producer of cassava in the world with annual production of 40 million metric tons. Cassava flour processing factory will work all the year round as raw materials are readily available.

Our annual consumption of wheat flour in Nigeria is put at 6 million metric tons, 10 percent cassava flour inclusion will increase cassava flour consumption to 600,000 metric tons annually. This can be translated to 3,000,000 metric tons of cassava tubers and 600,000 hectares of cassava being cultivated and also creating not less than 600,000 jobs for Nigerians.


Establishment of this project will lead to more activities in the farm as farmers will be encouraged to produce more cassava tubers, as there will be assurance of getting their farm products being sold. Cassava flour production is highly profitable because percentage return on cost of producing a ton is more than 100 percent. Establishment of this project will boost the productive sector of the economy. Productive sector development will lead to employment generation, high productivity and increase in country's gross domestic product. Other social and economic benefits derivable from the project are poverty alleviation, reduction in social vices, reduction in rural-urban migration, increased farm income and equitable distribution of income.


Technical information and project implementation procedure
Production of high-grade cassava flour for human consumption entails the use of high quality equipment for production that will meet the requirements of Standards Organisation of Nigeria (SON). Production process involves chipping/rasping, dewatering, drying and milling.

To establish the project, the procedures are feasibility study preparation, site procurement, equipment procurement, installation and test running, recruitment, raw materials procurement and commercial take-off. Genuine and serious minded investors can be assisted in the realisation of the project.

A bankable feasibility study is a pre-requisite to sourcing money from banks and institutional investors. Genuine investors can be assisted in the realisation of this project. Funds can also be raised through personal savings, assistance from family members and friends.

Profitability

It will cost N70, 000 to produce a ton of cassava flour which can be sold at a conservative price of N120, 000. Producing two tons per day for 200 days a year will provide a minimum net income of N20 million annually. This is no doubt a reliable means of livelihood in the country.


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