Turning Nigeria’s cocoa potential into climate-resilient livelihoods

Nigeria is one of the world’s largest cocoa producers, yet the country captures only a fraction of the crop’s full economic and social value. For hundreds of thousands of smallholder farmers, cocoa remains a vital source of income – but one increasingly under pressure from climate change, deforestation, and tightening global sustainability requirements.

Across Nigeria’s cocoa belt, rising temperatures, erratic rainfall, prolonged dry spells, and growing pest and disease pressures are undermining yields and farm productivity. These climate stresses are compounded by aging cocoa trees, soil degradation, and limited access to improved planting material. At the same time, global buyers are raising the bar: full traceability, zero-deforestation sourcing, and compliance with the EU Deforestation Regulation (EUDR) are fast becoming non-negotiable for access to premium markets.

For many processors, meeting these requirements remains out of reach. But for companies willing to invest early, the transition also presents a major opportunity.

A Nigerian cocoa processor investing in traceability and inclusion

This is where Plantation Industries Limited (PIL) comes in.

Founded in 2011 and based in Akure, Ondo State, PIL is one of Nigeria’s leading cocoa processors, producing cocoa liquor, butter, cake, and powder for export markets in Europe, Asia, and North America. The company works with more than 12,000 smallholder farmers organised through certified cooperatives across Ondo, Osun, Ogun, and Cross River States, and operates a modern processing facility certified to international food safety and sustainability standards.

Over the past decade, PIL has invested heavily in building a vertically integrated and transparent supply chain – linking farmers, cooperatives, licensed buying agents, and processing operations through digital systems. As an early mover on polygon mapping and EUDR readiness, PIL has already positioned itself among Nigeria’s most advanced providers of traceable, deforestation-free cocoa.

Yet scaling this model – while ensuring that farmers are not left behind – requires significant upfront investment.

“At Plantation Industries Limited, this partnership goes beyond grant support, it unlocks a pathway to scalable, climate-resilient cocoa processing in Nigeria. With DFCD’s backing, we are strengthening ESG systems, traceability, and agroforestry practices that mitigate climate risk, enhance farmer resilience, and ensure compliance with evolving global regulations. This investment lays the foundation for scalable impact and long-term commercial financing.” – Gbenga Ojo, Sustainability Manager, Plantation Industries Limited.

Scaling cocoa the right way: climate resilience, traceability and livelihoods

PIL’s growth ambitions are substantial. By 2027, the company aims to expand its sourcing network from 12,000 to 32,000 farmers and more than double its processing capacity – from 18,000 to 40,000 metric tonnes per year. The expansion is designed not only to meet rising global demand for sustainable cocoa, but also to strengthen farmer resilience and incomes in the face of climate change.

To do this, PIL plans to scale climate-resilient cocoa production practices, including agroforestry systems, improved soil and water management, and the use of drought-tolerant and disease-resistant planting material. At the same time, the company is investing in fully integrated digital traceability systems that ensure every cocoa bean can be traced back to a polygon-mapped farm, with automated deforestation alerts and real-time verification.

Equally important is the social dimension. PIL is strengthening cooperative governance, expanding extension services, and reinforcing child-labour monitoring and remediation systems, while embedding gender equality and youth inclusion across its supply chain.

DFCD’s support: de-risking expansion and preparing for investment

To help unlock this next phase, the Dutch Fund for Climate and Development (DFCD) Origination Facility has approved a €350,000 grant to support PIL’s development and prepare the company for an anticipated €13.2 million working capital loan from FMO.

The grant will finance a targeted package of origination activities designed to de-risk the investment and strengthen PIL’s technical, environmental, and social systems. These include:

• Upgrading digital traceability and EUDR compliance systems across the entire sourcing network

• Strengthening cooperative governance, financial management, and social safeguards

• Building extension staff capacity to deliver climate-resilient agronomy and EUDR-aligned advisory services

• Establishing demonstration plots and nurseries to accelerate adoption of improved cocoa and agroforestry practices

• Strengthening Environmental and Social Management Systems (ESMS) and developing a company-wide Gender Equality and Social Inclusion (GESI) strategy

Alongside technical implementation, SNV will support PIL in defining a focused set of practical and measurable KPIs from the outset, ensuring clear priorities and a robust yet efficient approach to tracking progress and results over time.

“This project shows how climate finance can help companies scale responsibly while strengthening resilience at the farm level,” said Diane Potey, Regional Lead for West Africa for DFCD at SNV.

“By investing early in traceability, climate-resilient production and inclusive supply-chain systems, PIL is contributing to Nigeria’s cocoa sector’s ability to meet global sustainability standards—while delivering more stable incomes and long-term opportunities for tens of thousands of smallholder farmers.”

Expected impact: resilient cocoa systems, stronger rural economies

With full investment, the project is expected to deliver wide-ranging benefits by 2030, including:

• 32,000 smallholder farmers adopting climate-resilient cocoa practices by 2027

• A 100% digitally traceable, EUDR-compliant supply chain covering all sourcing zones

• 12 demonstration sites serving up to 15,000 farmers as practical learning hubs

• Stronger cooperative governance and child-labour monitoring across six cooperatives

• Expanded processing capacity and increased domestic value addition

• Improved inclusion of women and youth through targeted economic opportunities and safeguards

By combining investment readiness with climate adaptation, biodiversity protection, and social inclusion, the DFCD’s support aims to help ensure that growth in Nigeria’s cocoa sector translates into lasting benefits for farmers, communities, and landscapes.

About Plantation Industries Limited

Plantation Industries Limited (PIL) is a Nigerian cocoa processing company based in Akure, Ondo State. Founded in 2011, PIL produces cocoa liquor, butter, cake, and powder for international markets and works with thousands of smallholder farmers across Nigeria’s cocoa-growing regions. The company is committed to traceable, deforestation-free, and climate-resilient cocoa production. Learn more: https://plantationltd.net/

About the DFCD

The Dutch Fund for Climate and Development (DFCD) is a climate resilience fund, dedicated to supporting climate adaptation and mitigation projects which benefit vulnerable communities and landscapes. It is funded by the Dutch government and managed by a pioneering consortium of Climate Fund Managers (CFM), Worldwide Fund for Nature Netherlands (WWF-NL) and SNV, led by the Dutch Entrepreneurial Development Bank, FMO. For more information, please visit the DFCD website.

About SNV

SNV is a global development partner deeply rooted in the African and Asian countries where we operate. With 60 years of experience and a team of approximately 1,600 people, we strengthen capacities and catalyse partnerships that transform agri-food, energy and water systems. Working on the core themes of gender equality and social inclusion, climate adaptation and mitigation, and strong institutions and effective governance, we tailor our approaches to different contexts to achieve large-scale impact and create sustainable and more equitable lives for all.

You can read the full disclosure document here.

For more information and if you want to share any confidential information you may have regarding the intended project or company, please contact:

SNV - Dutch Fund for Climate and Development: dfcd@snv.org