Averting Total Collapse of Poultry Industry

AGRICULTURE

Festus Akanbi writes on the current travails of poultry farmers, who are taking the heat from the prevailing low activities in crop production and the attendant rise in the cost of feed ingredients, especially grains  

The current economic challenges which appear to have overwhelmed key sectors of the economy: namely finance and manufacturing seem to have found their way into the operations of poultry business in virtually all the regions of the country.

The unfavourable operating environment, which has been blamed for the closure of many poultry businesses in the northern and southern parts of the country, has been attributed to factors including the rising cost of maize, instability in the exchange rate, and drop in the purchasing power of the potential customers among others.

Nigeria’s poultry industry, worth $4.2 billion according to the United Nations Food and Agricultural Organisation (UNFAO), is a major protein source for over 200 million people. But the sector, which contributes nine to 10 per cent to the GDP, has struggled in the last three years and many operators have abandoned their businesses due to high costs. Farmers lament high feed costs and traders complain about the cost of the constantly rising ingredients for the feeds.

Reports traced the scarcity of maize and other agricultural produce to the unresolved security issues, especially in the northern part of the country where many farmers have had to abandon their farms because of threats of kidnapping and killing by insurgents.

Maize farming is carried out in nearly all the geographical zones in Nigeria. However, the bulk of the country’s maize production is concentrated in Borno, Niger, Plateau, Katsina, Gombe, Bauchi, Kogi, Kaduna, Oyo and Taraba states.

Investigations also showed that the difficulties being encountered by poultry business operators are replicated in the fishery business as a combination of high cost of feed and maintenance has forced many fish farmers to suspend operation.

A random survey of the operation of poultry businesses in Lagos and some border communities showed that while some farms have scaled down their operations, others have closed shops. The areas visited included Ikeja GRA, Mushin, Lekki-Epe Expressway, Aboru, Iyana Ipaja, Sangotedo area of Lekki, Agbado Ijaye, Shomolu, Ojodu in Lagos while similar trends exist in Akute and Sango areas of Ogun State.

Interestingly, the problem of the challenges facing the sector is not limited to a particular zone in the country. For instance, the Poultry Farmers Association of Nigeria (PAN) in the North-central state of Plateau said the industry has been reduced to half because of the current challenges bedevilling the subsector.

The state chairman of the association, Johnson Bagudu, in a recent report, said that the poultry industry in the state happened to be one of the highest employers of labour with over 4,000 farms which in turn employed up to 10 to 20 staff each. He, however, regretted that due to the prevailing unfavourable operating climate, nearly 50 per cent of their members have either shut down operations or are operating below their original capacity.

On its part, the South-west Zone of PAN urged President Bola Tinubu, the Central Bank of Nigeria (CBN), and governors in the region to rescue the poultry industry from outright collapse.

The Zonal Chairman of PAN, Gideon Oluleye, who made the appeal in Ibadan, Oyo State, said the challenges facing the industry are enormous, noting that farmers are yet to recover from the effect of the naira redesign policy.

Poor Handling of Maize Allocation

He lamented that poor handling of the recent maize allocation arrangement by the CBN in the South-west has prevented Nigerian poultry farmers from benefitting optimally from the support of maize interventions. 

According to him, “Recently some maize was allocated to farmers by the CBN and the Nigeria Commodity Exchange (NCX) market, as part of interventions to bring down the soaring prices of maize in the market. About 40,000 metric tonnes were allocated at the rate of N220,000 and N225,000 per ton to farmers, while the farmers were still trying to negotiate a reduction in the price per tonnage, which they perceived as too high for an intervention programme, the two weeks payment deadline issued by the NCX lapsed.

“Only a few farmers and stakeholders could meet the deadline. At the expiration of the deadline, the NCX and the CBN withdrew the allocation. A few states like Oyo, Ekiti, and others paid at the brink of the deadline, yet the commodity exchange market went ahead to cancel the allocations. All efforts to convince them to renew the allocation at the initial price given proved abortive,” he said.

The PAN Chairman disclosed that the marketing strategy to hoard the maize had caused unnecessary scarcity, which had led to the high cost of maize in the open market while revealing that the cost of maize in the Southwest is currently about N400,000 – N430,000 per ton, which is not affordable to farmers.

The chairman lamented that the price of maize, formerly sold between N225,000 – N230,000 in the Southwest, now costs about N400,000 – N430,000 as a result of hoarding by the NCX.

Fall in Egg Production

With the fall in the purchasing power of the people, poultry business operators said the demand for eggs has fallen considerably and that it is affecting their pricing. For instance, in Jos known for its massive production of eggs because of its peculiar favourable weather conditions that suit commercial production, reports indicate that the last break-even price per crate of eggs had been around N2000. This is said to have now dropped to less than N1500, thereby throwing the hapless farmer into a precarious position. Poultry farmers argued that in contrast, the cost of poultry feeds has hit the roof as a result of the fall in the value of naira.

According to a statement jointly signed by PAN’s National President, Sunday Ezeobiora, and Director-General, Onallo Akpa, the poultry subsector in the country is heading for a crash if the government fails to salvage the industry, appealing to the government to employ urgent intervention.

Noting that the federal government has declared a state of emergency on the food security situation of the country, the PAN insisted that the situation of the poultry industry calls for an urgent intervention to save the industry from total collapse.

Farmers recalled that the federal government had in 2020 banned the importation of maize into the country as the CBN added maize to the list of items restricted from accessing foreign exchange to increase local production, stimulate a rapid economic recovery, safeguard rural livelihoods, and increase jobs.

Trouble in Fish Farming

Unfortunately for Nigerian farmers, fish production is not a better alternative this time as a combination of factors (including the instability in the prices of feeds and vaccines, and lack of market regulation leading to buyers’ determination of prices of fish) are forcing many fish farmers to close shops.

When THISDAY visited some fish farms in Lagos and Ogun states last week, it was a tale of woes by farmers who complained of the high cost of feeds. The recent increase in fuel price was also blamed for the suspension of their activities. 

Some promoters of fishery business who spoke with our correspondent said it is practically unprofitable to run fish farms with fuel prices sold at various prices. 

According to Mr. Stephen Ogunsola, who runs Testa Farms in the Olambe area of Ogun State, “There is no way one can make a profit if petrol price is still at N580 per litre given the fact that farmers will also incur other bills like feed and drugs for the fish. You have to continue to change the water if you want to grow healthy fish. In a situation where public power supply is not guaranteed, it means you have to rely on your generators. Already, we are coping with a fall in sales and the corresponding fall in the price of our products. 

“We are being forced to sell fish at ridiculous prices since demand is falling and there is no way you can hoard your products. If you do so and they die, that is a double tragedy for the farmer.”