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A Blockchain Business Proposal


Many areas in Nigeria are importing Rice and Tomatoes because of the blockage of Nigerian Farmers from exporting directly to foreign countries. This is one place where utilizing Blockchain technology can be used for predictive maintenance repair. By actively using cryptocurrencies at the beginning of the purchasing chain, as well as making direct purchases to African farmers on a regular basis, we are able to generate an alternative trading platform that will truly have minimal fees, and will reduce the costs of profits taken by third parties that control the import/export.

As a crypto enthusiast and I have discovered an opportunity in the Nigerian Rice and Tomato markets. This is aimed at helping farmers to distribute their products easily, as we all know that in Nigeria today, there are no ready markets for rice and tomatoes because of the current economic situation in the country. I have therefore decided to undertake on this venture to put such farmers into touch with buyers from all over the world.

Rice is the most consumed product in Nigeria. Blockchain holds the key to finally solve the lack of trust and inefficiency in moving rice across the country from its producers to consumers. By moving rice using cryptocurrencies like bitcoin on the blockchain, we can potentially cut out 80% of the cost and allow for any individual on earth to buy rice as easily as they can make an online bitcoin payment through any smartphone. This would revolutionize the Nigerian food industry, increase international trade, reduce inflation and allow Nigerians to save

When we say 'cryptocurrency' or 'digital currency' we mean Bitcoin or any other similar open-source distributed peer-to-peer system. In Nigeria, cryptocurrencies have become very popular recently. We consider them as an important tool for achieving business objectives and sustainability while reducing risks and costs. We plan to include cryptocurrencies in the Nigerian rice farming business, making Nigeria the leading country in rice production on the world market.
The objective is to describe and explain the ideas we need to dominate the Nigerian rice and tomato industries with my sanity intact.


The Opportunity

Rice is the world’s number one staple food. About 60% of the world’s population consumes rice as part of their daily diet. China, India, and Indonesia are the largest producers of rice whilst Thailand is the largest exporter. However, 94% of rice produced is consumed locally that is, in the producing countries.

Annually, Nigeria consumes well over 6 million metric tonnes of rice but produces only 2.4 million metric tonnes. The shortfall is bridged by importation. Despite having 4.9 million hectares of land suitable for rice cultivation with a meager 37% currently in use, Nigeria spends N350 billion on rice importation annually. This production potential if harnessed will translate not just into food security for the nation but Will also make Nigeria a net exporter of rice.
The government of Thailand has promised to increase the price paid to its rice farmers for paddy. This Will result in an increase in the price of imported rice thereby making local rice production more competitive compared to importation and bagging.

In a bid to achieve food security, the federal government has put in place programs to boost rice production in Nigeria.  The government at various levels currently offers incentives to investors interested in large-scale rice production. This includes land for production, credit facilities, tax exemption e.t.c. The federal government earlier banned rice importation by the year 2020 and later lifted the ban.

Investment in large-scale rice production represents a major economic opportunity for investors and other parties interested in rice cultivation and milling.  

The Product

XYZ Limited is an operating division of the parent company focused on cultivating, milling, and packaging rice. XYZ Limited is conceived to be a leading indigenous rice brand that will provide Nigerian households with high-quality long grain rice that is completely stone-free at a competitive price. XYZ Limited will partner with major rice retailers in major cities in Nigeria to ensure that XYZ Limited rice gets to all Nigerian households. The company XYZ will also sell to businesses (Fast food outlets, Hotels, Caterers e.t.c.) and institutions (NYSC, Nigerian prison service, Hospitals e.t.c.).

XYZ Limited will be produced in a hygienic environment and XYZ will conform to the standards of food production in Nigeria. It will be of high quality and affordable at 120 per kg which is well below the market price for other rice brands. XYZ Limited will be packaged in 50kg, 25kg, 10kg, 5kg and 2kg bags which will make it ideal for a wide range of consumers in the Nigerian rice market. Its value proposition includes affordability, high product quality, and convenience.

External environment

Global Rice Market will be a USD 274 Billion opportunity by the end of the year 2027. Rice is mostly consumed in the Asian regions from Japan in the east to Pakistan in the west and is the 2nd most vital crop cereal after maize or corn.

It is expected that the rice market's growth will surge during the forecast period since it's also been cultivated among the non-consuming region such as North America. Across the globe, Rice species and its varieties have a name given by its origin name say Oryza sativa also called Asian rice and Oryza glaberrima or African rice, Japonica rice, Indica rice varieties.

Besides, rice is a staple diet in various developed and developing countries. Thus it is considered a strategic commodity and remains subject to a wide range of government controls and interventions. On this contrary, Rice also plays a pivotal role as a wage commodity for the workers in the non-agriculture sectors and cash crops.

Despite the current pandemic, COVID - 19 has not much impacted the rice market globally than other industries as its demand has been increasing. The driving factors that boost the global rice market are support from Government and other Associations in developing nations like Nigeria, advancement in technology, and demand for higher quality rice from gulf countries during festive seasons.

Global production of rice was 495.78 million tons in 2020 with 94% of production consumed locally. The Food and Agricultural Organization has said that to assure food security in the rice consuming countries of the world, rice production will have to be increased by 50% by 2025.  Increasing world population and continual dependence on rice will raise the level of rice consumption in coming years, especially in the oriental countries. This could result in a reduction in the global rice trade if production is not increased.

According to the International Rice Research Institute (IRRI), the price of rice increased 7.2?tween March and September 2011. This can be attributed to the new rice policy of the Government of Thailand to buy rice from farmers at a price that is 40?ove the current market price and the harvest loss of 1.5 million metric tonnes of rice due to the nuclear disaster on March 11, 2011, in Japan.

The Nigerian rice market is highly concentrated with 36% of the market controlled by the three leading firms in the industry. Stallion Group the industry leader has 19% of the market share with Caprice as their major brand. Other players include: Dangote Group (10%) and Olam Nigeria (7%). Stallion Group and Dangote Group import and bag their rice while Olam Imports and also buys rice paddy from local rice farmers for milling.

a.      <!--[endif]-->Rice Demand Dynamics in Nigeria

Rice has become an essential part of the Nigerian population’s diet. Its ease of preparation and the fact that a relatively small quantity can serve more people has increased its importance not only to the more urbanized population but also for large families with low income.
According to the Food and Agricultural Organization, an average Nigerian consumes 24.8kg of rice annually. Average rice consumption in major cities is:  Lagos (72kg), Abuja (64kg), and Markurdi (74kg). Total consumption is estimated at 6 million metric tonnes. This figure is on the increase and is expected to double before 2025.



The average Nigerian rice consumer has continually shown a preference for imported brands. This can be attributed to the perception that imported rice is of a higher quality and completely stone free, unlike the Nigerian rice that is sometimes referred to as “Oh God!” because of its stone content.


<!--[if !supportLists]-->b.     <!--[endif]-->Rice Value Chain

The rice value chain consists of:

<!--[if !supportLists]-->1.     <!--[endif]-->Primary production;

<!--[if !supportLists]-->2.     <!--[endif]-->Processing;

<!--[if !supportLists]-->3.     <!--[endif]-->Marketing

In Nigeria, primary production is usually undertaken by smallholder farmers who produce for subsistence and sell excess paddy output to paddy traders who sell to small and medium rice mills.  A lot of farmers now enter into agreements to sell their rice paddy to large industrial mills. This is usually structured in the form of an out-growers scheme. To ensure a constant supply of rice paddy and protection against an increase in the price of paddy for their production, some industrial size mills have integrated backward into rice cultivation.

Rice processing in Nigeria is undertaken by artisans, small and medium-size mills, and large industrial mills. The artisans engage in parboiling, destoning, and milling using locally fabricated equipment. Processing by artisans may not involve destoning hence the unpleasant presence of tiny stones which makes it unattractive to consumers. The small and medium-size mills engage in parboiling, destoning, milling, and polishing. The quality of the rice produced by this group is usually comparable to that of imported rice. However, it is not completely stone-free. Large industrial mills engage in rice processing on a large scale. Their finished product is usually of the same quality as imported rice. Marketing at this level is carried out by the large distributors, wholesalers, supermarket and stores, and the low-end retailers.

The value chain is divided into several channels that serve different markets characterized by location, taste and quality preference.

<!--[if !supportLists]-->1.     <!--[endif]-->The traditional channel serves the rural village market and is supplied by traditional farmers.

<!--[if !supportLists]-->2.     <!--[endif]-->The servicing mill serves rural market towns and is a highly disaggregated channel that accounts for the majority of all domestic markets.

<!--[if !supportLists]-->3.     <!--[endif]-->Medium commercial milling serves the middle-end urban market and includes medium-sized mills.

<!--[if !supportLists]-->4.     <!--[endif]-->Industrial processing is targeted at import substitution with high quality locally grown and processed rice. This is where Merit Exports Will play. However, unlike other players in this channel, Merit Exports Will engage in both cultivation and processing.

<!--[if !supportLists]-->5.     <!--[endif]-->Imported rice serves the high-end urban market.

The Nigerian rice value chain is complicated because of the size of the country, the prevalence of different production systems and ranges of processing clusters. The difference in processing clusters is significant because of the flow of rice from states without developed processing to states that have developed processing capabilities.

Value Chain Dynamics: Constraints to Reaching End Market Opportunities

<!--[if !supportLists]-->c.      <!--[endif]-->Industry Environment for Rice Milling in Nigeria

The Nigerian rice market is highly concentrated; the three leading firms control 36% of the total market share. Stallion Group is the industry leader with a 17% market share followed by Dangote Group and Olam Nigeria with a respective market share of 10% and 7%. Only about 40% of rice consumed in Nigeria is produced in the country. Most of the firms that operate in the Nigerian rice market do not produce their rice. They buy semi-processed rice, mill, bag and then sell in the country.

However, in recent times, some of the major players in the market have integrated backward to assure a steady supply of rice paddy for their mills. Notable brands in the Nigerian rice market include: Caprice, Dangote rice, Mama’s pride, Uncle Ben’s, and Royal Umbrella. The biggest rice market in southwest Nigeria is in Iddo, Lagos state.

Industry Players

Market share

Common Brand

Stallion Group

19% (Market leader)

Caprice, Better Rice

Dangote Group


Dangote Rice

Olam Nigeria


Mama’s Pride

Other Importers


Local production

+/_ 44%


The Nigerian rice market is dominated by imported rice majority of which is smuggled into the country through the land borders. The smuggled rice is used to flood the market and sold at a price lower than that of the locally produced rice. The activities of the smugglers have almost crippled local rice production. Some major local rice producers in the country are on the verge of shutting down their operations.

Rice importation through the land borders was banned earlier this year. Whether this measure will be effective in stemming the tide of rice smuggling remains to be seen. The price of rice is expected to increase in the coming months as a result of the announcement by the government of Thailand to increase the price paid to its farmers for rice paddy.



Business Opportunity

Nigeria, although was ranked the 14th world producer of tomatoes is also reckoned, the 8th world largest importer of tomato paste. This is a country with over 170 million populations with very large market size and varied opportunities in the agricultural sector, yet these opportunities have not been fully harnessed; this anomaly is due to dysfunctional agricultural practices aggravated by poor infrastructural development.

Crude oil is has been the backbone of the Nigerian economy in the past 3 decades but the astronomical decline in international oil prices has compelled the Nigerian Government to look for alternative means of foreign earnings. The sector that is now the focal point of the Nigerian Government, though with untapped opportunities in the agricultural sector. This has also forced the government to look inward strategies to conserve foreign exchange by engaging our agricultural resources productively, while at the same time, placing an outright ban on imported goods that Nigeria can produce. One of the imports that had been brought before the table of the Federal government is imported tomato pastes.

Also, Nigeria, being one of the world largest producers of tomatoes estimated at 1.7 million per annum, yet over 50% of the produce is lost due to various problems in the value chain of tomato fruit production. The need to salvage the produce from local farmers, prevent capital flight through the import of tomato paste, necessitates entrants into large scale production of tomato paste as well as revitalization of the value chain. In this regard, XYZ Firm, aligning with the Federal Government strategy of making Nigeria self-sufficient in tomato paste production has the intent to set up 1200 metric tons per day tomato processing plant in Jos.

Although, Dansa Food has commenced operation of its 1200 metric tons per day tomato paste plant in March 2016, its processing capacity is not sufficient to cater to the needs of the teeming Nigerian Population. For this reason, XYZ Firm has decided to join the league of large-scale producer of tomato paste and is poised to be one of the leading producers of tomato paste in Africa.

Economic Value of The project

Our entrant into this agricultural segment will contribute towards solving some of the problems in the tomato production value chain. We shall also assist farmers with hybrid seeds that are disease resistant, through our research effort, assist them with our equipment and also the technical know-how in modern farming methods for tomatoes. Our plan will also include a social responsibility effort of establishing a hospital as well as a school in the local community where the project will be sited.

Also, our co-partnership with selected farmers based on some established criteria, will also, provide a ready market for their farm produce thereby reducing spoilage of fresh tomatoes produced from their farms. This partnership shall include the nucleus of over 5,000 local farmers.

Target Market

Our target market shall be first within the Nigerian market and thereafter, we shall target the export market. Also, within the local market, we shall target large supermarkets such as Shoprite, SPAR, and online grocery stores. We know that our bulk market shall be targeted to reach importers whom we have been talking to and will also serve as our distributors. This will help us reach the consumer end of the market without incurring capital costs of setting up distribution centers. We shall reach this market through targeted online advertising in collaboration with email marketing, handbills as well as any business journals or periodicals that endears to our target customers. Also, personal contacts and any forum related to our industry shall be explored.

Product Life Cycle Of Tomato Paste

Every product passes through the following different stages of the product life which are stated as follows:

<!--[if !supportLists]-->       I.            <!--[endif]-->Introduction Stage – At this stage, the product is created and put into the market.

<!--[if !supportLists]-->    II.            <!--[endif]-->Growth – The Product becomes known in the market and patronage increases through our marketing and branding strategies.

<!--[if !supportLists]--> III.            <!--[endif]-->Maturity – Sales has reached the peak for the products but growth rate starts to go down as new competitors with the same scale of production enters the market and the market is saturated with tomato paste

<!--[if !supportLists]-->IV.            <!--[endif]-->Decline – at this stage, sales begins to fall.

Given above life cycle of a project, how can we deal with the factors that can affect our performance when our product reaches the final stage?

Here are some strategies we can employ to maintain sales:

<!--[if !supportLists]-->       I.            <!--[endif]-->Product repackaging while still maintaining brand name and quality.

<!--[if !supportLists]-->    II.            <!--[endif]-->Research and development programs to develop novelty products using tomato

<!--[if !supportLists]--> III.            <!--[endif]-->Improving the flavor of existing products.

Production Strategy

Tomato Paste Production

Tomato paste production requires the extraction of the juice from the tomato fruit which contains more water than solid. Empirically, 100kg of tomatoes unloaded from trucks for processing will produce about 93kg of juice to be concentrated before it is fed to the evaporator which automatically regulates juice intake and finished concentrate output; Following processing from the concentrate output, 4.46 tons of fresh tomatoes is required to produce 1 ton of finished tomato paste (at 28% Brix and making provision for losses). Although, the tomato concentrates can be at its intermediate state, for industrial use, this is not factored in this business plan.

There are two ways to produce tomato paste – The Hot Break and The Cold Break. For the Hot Break, fresh tomatoes are heated immediately after chopping, at high temperature while Cold Break requires the tomatoes to be heated at lower temperature. Also, Hot Break Pastes are usually used for Ketchups and other tomato sauce while Cold break is mainly used for Triple Concentrate paste and packaged for domestic use.

Furthermore, the production operation will be scheduled in such a way that the production machinery is used to the maximum capacity and that production goes on interrupted. It follows therefore that, we shall schedule our production in such a way that all processes are fed with constant supply of raw materials while we also make a schedule for equipment maintenance.

The production Process is as follows:

<!--[if !supportLists]-->1.     <!--[endif]-->Receiving: Tomatoes are received from the trucks using a special tube/pipe with vast quantity of water into the trucks. This allows for easy flow of the tomato fruits.

<!--[if !supportLists]-->2.     <!--[endif]-->Sorting: More water is pumped into the collection channel which carries the tomatoes into a roller elevator, rinses them and subsequently conveys them to a sorting station.

<!--[if !supportLists]-->3.     <!--[endif]-->Chopping: The tomatoes suitable for processing are pumped to the chopping station where they are chopped.

<!--[if !supportLists]-->4.     <!--[endif]-->Breaking: The pulp is pre-heated to 65-75°C for Cold Break processing or to 85-95°C for Hot Break processing.

<!--[if !supportLists]-->5.     <!--[endif]-->Juice Extraction: The pulp (consisting of fiber, juice, skin, and seeds) is then pumped through an extraction unit composed of a Pulper and a Refiner - these are essentially large sieves. Based on customer requirements, these mesh screens will allow more or less solid material to pass through, to make a coarser or smoother product, respectively. Also during this process, the yield for the pulp is about 95% while 5% comprises seeds, fibre, skin, and these are treated as waste and transported to be sold as cattle feeds or processed as biomass for power generation.

6.     Holding Tank: At this point the refined juice is collected in a large holding tank, which constantly feeds the evaporator.

<!--[if !supportLists]-->7.     <!--[endif]-->Evaporation: This is the most energy-intensive step of the whole process – this is where the water is extracted, and the juice that is still only 5% solid becomes 28% to 36% concentrated tomato paste. The evaporator automatically regulates juice intake and finished concentrate output; the operator only has to set the Brix value on the evaporator’s control panel to determine the level of concentration.

<!--[if !supportLists]-->8.     <!--[endif]-->Aseptic Filling: The concentrate is sent from the evaporator directly to an aseptic tank – it is then pumped at high pressure through the aseptic sterilizer-cooler (also called a flash cooler) to the aseptic filler, where it is filled into large, pre-sterilized aseptic bags. Once packaged, the concentrate can be kept up to 24 months.



What Is Blockchain?

Blockchain is a peer-to-peer distributed database that is used to maintain a growing list of records called blocks. It is "an open, distributed ledger that can record transactions between two parties efficiently and in a verifiable and permanent way". It is the technology that allows Bitcoin, Ethereum and others to


We must start giving market attention to the FRCN Zocalo (movable digital currency) concept and introduce the currency as an economic weapon, not only for the good of Nigeria but also for the good of humanity. Financial experts suggest that under the right economic climate, zocalo can deliver over $12 billion in fees and other exchanges, and in an African context, the potential is even more. Zocalo is a platform that will open up a range of useful services to customers as long as they are willing to trade in the e-currency.

A National Payment Mechanism (NPM) is in the making, which will see the emergence of Fidelity e-Filing Service, Fidelity e-Transfer Service, Fidelity e-Remittance Service, Fidelity e-Banking Service, Fidelity e-Brokers Service, Fidelity e-Transactions Service and Fidelity e-Investment Services. In addition, customers will be able to buy, sell, send, receive and hold Zocalo. They will also be able to transfer, receive, and make payments in Zocalo.

The payments which will be from Zocalo to conventional currencies will be eligible for taxes, fees, and other levies and duties such as social security and value-added tax. Using cryptocurrency, you can have your cake and eat it. There are several benefits to crypto transactions: they are fast and secure; they offer the most favorable rates; it is globally accepted, and there are no risky hidden fees. Cryptocurrencies are not regulated in Nigeria. They can therefore be more costly and risky to transact, and will probably also involve some vulnerabilities. In Nigeria, the National Information Technology Development Agency (NITDA) has put out some FAQs and guides. A few tips to consider if you are considering Bitcoin are: you cannot hold Bitcoin (digital currency) in Nigeria; you cannot convert money into Bitcoin, and you cannot hold Nigerian Naira in Bitcoin. However, there are ‘safe’ ways to explore the concept of using digital currency in Nigeria, and it is imperative that the country gets the lowdown.

Cryptocurrencies are the virtual version of traditional money. They are ‘programmed’ with a combination of math and computer code. Anyone with internet access can download a virtual wallet for digital currency and use it to buy goods and services. Bitcoin, the original virtual currency, was created in 2009 by someone called Satoshi Nakamoto, who described it as a ‘peer-to-peer electronic cash system’ that would enable instant payments and overcome any volatility that is present in actual physical cash. It is the first digital currency in existence. Bitcoin is currently valued at about N200,000 or $0.01. It is possible to purchase cryptocurrency in Nigeria via one of a number of authorized websites such as Bitplace Nigeria, BitcoinTruer, TeraExchange, BitX, Obalon, and BTCzone. A trading website where you can buy and sell Bitcoin is Bitwise Exchange. Bitcoin exchange platforms are not well regulated in Nigeria, although the Central Bank of Nigeria (CBN) has said that it will soon introduce guidelines on bitcoin trading.

The usage of cryptocurrencies for trading and investments is becoming popular in Nigeria. In 2017, the United States recorded $300 million worth of Bitcoin trade, and in Nigeria, the e-payment space is gaining traction with over N20 billion going through mobile money and PoS machines per month.

Within the next five years, analysts say that cryptocurrencies will be worth trillions of dollars. One of the issues in Nigeria’s cryptocurrency market is the absence of tax relief for companies using them to pay salaries and other obligations. The government also said that crypto assets were not covered by the Companies Income Tax (CIT) regime. The CBN has also warned Nigerians not to trade in bitcoin, saying it was too volatile for its consumers and not endorsed by any country.


Trading digital currencies will require special regulatory attention because, in theory, it exposes investors to great financial risk. According to Jumoke Akinjide, a lawyer at Zenith Bank, digital currencies have their pros and cons. “For instance, the cryptocurrency market has grown astronomically in the last few years with Bitcoin as the most popular digital currency,” she said. However, “Any company or individual trading in digital currency can easily be scammed because the virtual currency does not exist in a centralized regulatory environment,” Akinjide warned.

“Other risks associated with digital currency trading, however, outweigh the potential benefit. For example, since the digital currency is an emerging financial product, there is no regulatory framework in the place to govern digital currency trading or reporting, and market participants are at risk of illegal manipulation and fraud,” she added.

According to CBN deputy governor, Dr. Joseph Nnanna, cryptocurrencies are not legal tender in Nigeria, and therefore cannot be treated as such. “In some jurisdictions like China, virtual currencies are banned,” he told The Punch newspaper. “Similarly, in Japan, digital currencies are prohibited.” Other cryptocurrencies include Ethereum, Ripple, Litecoin, Monero, Bitcoin Cash, Cardano, and EOS. Akinjide said that the caveat in Nigeria regarding trading Bitcoin is that the transaction must be done in dollars.

Takeaway: I think of blockchains as a technology that can be leveraged to make businesses or industries better. Like how they made the stock market better.

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