Valency to ramp up Nigerian agribusiness operations

Singapore-based agribusiness firm Valency International is set to significantly grow its operations in Nigeria. The company recently secured financing, previously disclosed to be US$60m, from a consortium of European development finance institutions, including France’s Proparco, Germany’s DEG and the Netherlands’ FMO. The funding package will allow Valency to double its cashew kernel factory capacity, diversify its Champion-branded packaged food products, establish a supply chain complex, and set up a multi-seed crushing plant to scale production of fully processed, value-added goods.

Traditionally a trader of Africa-sourced commodities, Valency began vertically integrating its operations in 2015 by launching cashew processing in Nigeria. Today, the company operates in several African countries and has developed a diversified agribusiness portfolio spanning edible nuts, seeds, grains, cocoa, pulses, fertilisers, and agrochemicals. In Nigeria, its operations include edible nuts, oils and seeds, grains, and food processing.

The funding will enable Valency to increase the capacity of its cashew kernel factory in Ibafo, Ogun State, from 50 tonnes per day to 100 tonnes. This expansion is expected to add 15,000 tonnes per year of cashew processing capacity in Nigeria, nearly all of which will be exported, generating foreign exchange earnings from a non-hydrocarbon source. Valency procures raw cashew nuts directly from Nigerian farmers and processes them locally, with the resulting cashew kernels distributed globally. Under its With Love, Gretel brand, the company also markets sprouted cashews in Singapore.

Nigeria, which currently exports much of its cashew crop in raw or semi-processed form, loses significant value to overseas processors. This processing – removing shells, peeling, roasting, and salting – is often completed in countries such as Vietnam and India. In 2023, Nigeria exported US$185m worth of unshelled cashew nuts, with Vietnam receiving US$118m and India US$60m. Shelled cashew exports totalled US$142m, with Vietnam again the leading destination at $109m, followed by India at US$13m.

Valency’s expanded operations aim to keep more of this processing within Nigeria, capturing greater value locally. The country’s geographical proximity to Europe and North America also offers competitive advantages over Asian processors, including fresher products and reduced logistics costs.

The funding will further support the establishment of a supply chain complex in Ibadan, Oyo State. This facility, a central warehouse capable of storing 45,000 tonnes of agro-commodities, is expected to reduce food waste and bolster food security. Additionally, Valency plans to build a multi-seed crushing plant in Ibadan, boosting Nigeria’s capacity for fully processed, value-added agricultural products.

In the fast-moving consumer goods sector, Valency is scaling its Champion brand, which was developed in Nigeria. Currently, the brand includes custard, milk powder, and chocolate milk powder, with plans to introduce new product lines.

 

References

‘Invest in Africa cashew’, African Cashew Alliance, 2022

‘British International Investment supports Nigeria’s agricultural sector with commitment to Valency International’, British International Investment, 11 December 2023

‘Singapore trader Valency to expand cashew operations in Nigeria’, NTU-SBF Centre for African Studies, 25 December 2023

‘The European market potential for cashew nuts’, CBI, 25 January 2024

‘Proparco, DEG, and FMO partner to provide strategic syndicated financing to Valency International to drive agricultural growth and economic development in Africa’, Proparco, 18 December 2024

‘Valency International Pte. Limited’, FMO, Accessed 19 December 2024

‘List of importing markets for a product exported by Nigeria: 080132 Fresh or dried cashew nuts, shelled’, Trade Map, Accessed 19 December 2024

‘List of importing markets for a product exported by Nigeria: 080131 Fresh or dried cashew nuts, in shell’, Trade Map, Accessed 19 December 2024