As a result of the success we achieved during our first attempt. We started thinking big, because since that time I surrendered all my time, money and everything to the internet searching for buyers of agricultural commodities from northern Nigeria.
Lucky us, in 2010 we also sent two containers of hibiscus flower to Germany, though we are not 100 percent owners of the crop. We invited one Alhaji from Kwari market Kano (the largest textile market in Nigeria) as the partner and put some money into the business.
Success upon success, we also did in 2012 and we earned a profit. In 2013, we travelled all the way from Nigeria to Dubai with my friend in search of more agricultural commodities buyers where we attended Gulfood Conference. By God grace, we were opportune to get many buyers of our products.
To cut the long story short, in 2014 my brother and I, and some of his friends decided to enter into the business because there was a demand of hibiscus flower from that German company we supplied before.
We travelled from Kano to Katsina, Jigawa to even volatile Yobe states purchasing hibiscus flower and Arabic gum from local suppliers who grow it on their own farm, because buying from them will add a little profit for you instead to buy from wholesalers.
I have the contract of nine containers from the German Company, which cumulatively would cost 198,000 USD. The amount needed for that nine containers is very large, so we decided to start by sending 2-3 containers after we received the money we should proceed by sending 4-5,- up to the nine. And in the contract the instructions say supplies would be bit by bit.
I really did a lot in order for me to see the contract was made. We rented a small warehouse and employed 40 people, mostly widows women who are living in abject poverty. Every blessed day when there is work our place is like a mini market. You can see local food sellers selling to our workers. The work they did was cleaning the hibiscus flowers by removing the sand and foreign matters from it after they finished, the muscled teenage males are also doing theirs by re-bagging and weighing the goods.
After all these works, the truck would be at our warehouse for loading to Lagos port. This is another added profit to the laborers because you’ll have to pay them bag by bag when they upload them into the truck. Every trailer takes 400 bags.
When arrived in Lagos port you’ll also have to pay laborers in port to download it from the truck to the container designated for export.
I brought this issue because I wanted you to understand what we’re doing before we sent a single container of the crop to foreign market. We must pay for the transportation to Lagos since the trucks were not our Father’s.
After the ship carries your load it is the must for you to pay that shipping company because the terms and condition of the contract are CNF (cost and freight). Business people know what this means.
We sent 3 containers to Lagos and already the ship loaded them. The shipping company ordered us to pay their charge and that charge is in Euros and Dollar currency. I went to the bank and asked them for Euros and dollar this is where the injustice started. If you want buy Euro or Dollar from a bank they won’t give you because they said it wasn’t available so you have to go to the black market and buy it at a higher rate. We bought both Euro and Dollar from a bureau de change and paid the shipping companies to their domiciliary accounts.
After we get all the shipping documents we sent it to our bank Ecobank Nigeria Limited and sent them to our buyer’s bank in Germany as the contract stated.
Our buyers paid the 75% amount in dollars and here in Nigeria because of the dreaded policy of CBN our bank told us that they have to give us Naira because the CBN issued a new policy that no more receiving foreign currency. We asked them how much are they buy our dollar they said they would buy it at CBN official rate that was 196.78 Naira per 1 dollar while at that time in parallel market is 223 Naira. We calculate our margin, which shows that we are going to lose 1.8 million Naira. The expected profit was 400,000 Naira after expenses for each container, but now CBN policy is going to ‘chop’ our money for nothing. So, when you do the calculation the profit was 1.2 million Naira and now we are going to lose another 400,000 Nair
For God sake which country are we living how on this earth a few group of people who locked themselves in an air conditioning office issued a horrific and tumultuous policy. Where are they the time we are struggling to do the business, is this the way that they think dwindling Naira can regain its consciousness?
We are trying day and night to see that business became reality and in one day CBN made us fired all the people that we employed as laborers. It will take us at least one good year before we finished the contract. And also the company told me that that was a trial order if we deliver successfully without any problem they will give us more contract at least 40 containers in 2016, but all our dream to be self-reliant and make our local farmers grow more crops became otiose due to CBN dreaded and fearful policy. I swear to Almighty God we really suffered from this policy because the money was not ours how could I explain this to our partners who expect to get their profit as promised?
I learnt that in a Dawanau Commodity market in Kano, there are many crops but no buyers because since this policy takes effect many small exporters stop exporting except big exporters who keep their money abroad when they did the business.
My afraid is when this policy goes like this without any subsidy from the government I swear to Almighty God our farmers will be in trouble they won’t get any buyer of their crops. The reason I said so is when we small exporters runaway from the business the big exporters will remain in the market and buy in lower, lower price which at last made our farmers lose a lot.
I am calling with a loud out voice to President Muhammadu Buhari to do something because this policy will deter agricultural export in northern Nigeria being farming is the main occupation and main source of income for millions of people in the region.
However, CBN must wake up from its slumber and face the reality of what is on the ground because they issued a policy that advertently chased us away from the business. And it was also fired poor people who benefited immensely from the business. Now we shall wait and see what another thing do the CBN told us.
Hussain Umar Is the General Manager Musbahul Khair International Resources Limited.
He writes from
1259 Yakasai Quarters