In July 2021, a major supply-side crisis in Nigeria forced the Dangote Tomato Processing Co. Limited plant of Dangote Farming to operate at just 20 per cent of its production capacity. Since its inception in 2016, the plant was shut down several times due to a shortage of fresh tomatoes of the required quality. Although the Nigerian government supported Dangote Farming by pursuing pro-tomato and pro-tomato-paste policies, it was unable to operate its processing plant at full capacity, reduce per-unit cost, and improve profitability. Due to various constraints, several tomato processing plants had exited the Nigerian market in the past several years. In view of persistent supply-side problems and tough competition from low-priced Chinese tomato paste, Dangote Farming needed to decide about the continuity of its tomato processing plant in the Nigerian market. If it decided to remain in the market, then it needed to devise strategies that could make the plant competitive and profitable.
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