Stories by Steve Agbota [email protected] 08033302331
Though smuggling and high feed costs are part of several challenges facing Nigeria’s poultry industry, there are still opportunities for growth, with abundant social and economic potential, which can contribute one of the highest percentages to the nation’s Gross Domestic Product (GDP).
The demand for poultry products both for meat and eggs is rising in emerging economics as the industry has capacity to generate over N1.2 trillion for farmers, farm workers, transporters, input suppliers (feed, DOC), laboratories, extension officers, veterinary doctors, financial service providers, processing plants and other stakeholders, if it challenges are adequately tackled.
Despite these challenges, poultry farming can bring in lots of income, boost the country’s economy, create business opportunities for entrepreneurs, provide employment opportunities and give consistent returns.
Looking at viability, the opportunities in the broiler market alone are substantial and all people need to do is to take a closer look at the value chain.
Take, for example, the feed mills. If poultry farmers are allowed to produce the 1.5 million tonnes of chickens consumed locally, the feed mills will have to supply about N700 billion worth of feed, the hatchery will also generate N145 billion worth of Day Old Chicks (DOCs) and the animal pharmaceutical industry will have to deliver drugs and vaccines worth about N45 to N55 billion. Put figures together and you get about N900 billion.
The numbers are just on the input side of the business. But 70 per cent of that N900 billion is not allowed to be made in Nigeria’s poultry industry because of the imported chickens blocking the flow. Ideally, Nigeria has enough poultry farmers who are ready to breed broilers because they have the space and the farm but because of this constraint, nobody is willing to fully exploit that market.
According to Mr. Gbolade Adewole, the Coordinator of natnuPreneur Broiler Outgrower Scheme by natnudO Foods, Nigerian poultry industry has the capacity to generate N1.2 trillion revenue if it is fully exploited. He added that issues of smuggling and other related challenges need to be tackled so that farmers can exploit the opportunities that abound in poultry business.
He explained: “From available statistics, Nigeria consumes about 1.5 million tonnes of chicken annually but produces only 30 per cent of that. It is not that we do not have the capacity to produce 100 per cent of what we consume, it is just that 70 per cent of the chickens we consume is smuggled into the country. Some people call them ‘cadaver’ chickens because of the long and poor storage process they go through before getting into the country. This is basically one of the biggest challenges confronting the broiler market in Nigeria.”
So, from an economic perspective, it is affecting all the stakeholders in the value chain, namely, farmers, farm workers, transporters, input suppliers (feed, DOCs), laboratories, extension officers, veterinary doctors, financial service providers, processing plants, etc.
Analysing this trend, Adewole said: “Let us do some ballpark numbers together; 1.5 million metric tonnes of chicken is 1.5 billion kilogrammes of chicken, the average dressed chicken weighs 1.4kg so that gives us 1,071,428,000 birds consumed annually. That is the amount of chicken we consume every year. So, revenue on input alone will be about N900 billion if we were producing 100 per cent of what we consume, since we are producing 30 per cent of N900 billion that means we are losing N600 billion that cannot be done here.”
According to him, for example, people are opening feed mills all over Nigeria, which has brought about competitiveness among market forces, which is good for farmers. However, he said it also means that some firms will be knocked out of the feed market despite all the investments they have made, adding that the ripple effect is what is more dangerous, like heavy job losses along every point of the value chain.
He added: “That is what we meant when we said across the value chain, our natnuPreneur scheme alone has the capacity to employ well over two million people. If we are to produce approximately, 1,071,428,000 chickens, you can imagine the number of people we will need to produce them. The number of people we will need at the hatcheries, the feed mills, in logistics, laboratories, extension officers, veterinary doctors, etc., can only be imagined.”
While highlighting the efforts of natnuPreneur in bridging the gap in the Nigerian chicken market, Adewole said, “we have reached out to the Consumer Protection Council (CPC) and some members of the House of Representatives. The Group Managing Director of Amo Group, Dr. Ayoola Oduntan, has also served on a Senate subcommittee on this smuggling issue. So, what we have done is to provide government with as much information as possible because they are concerned about what is happening. We are also working with the CBN and NIRSAL on the Anchor Borrowers Programme (ABP) to help increase local production as much as we can.
“I will like to begin with the interesting hypothesis that says that smuggling of chicken has been banned. The goal is to focus, as we have done, at AMO Farms, through the natnuPreneur scheme, on farmer profitability. As long as we can work out how the average broiler farmer can make and increase his profit, year by year, then we can be sure that the production will grow to fill this 70 per cent gap created by the importation of ‘cadaver chickens’,” he said.