Obinna Ezugwu
Poultry farm. Photo credit: MullyBy AYOOLA OLAOLUWA
Nigeria’s ailing poultry industry is on the verge of collapse owing to several challenges affecting the sector, Business Hallmark can reveal.
The hitherto boisterous industry, which is one of the most consolidated sub-sectors of Nigeria’s agriculture, contributing about 25 per cent of the Agricultural Gross Domestic Product (AGDP) and providing over 25 million direct and indirect jobs, according to the National Bureau of Statistics (NBS), is presently being threatened by declining demand for chicken and eggs, supply chain disruptions, high cost of feeds and drugs, foreign exchange scarcity and accelerating inflation.
“From foreign exchange volatility to the high cost of feeds to supply chain disruption to smuggling and the current low consumer demand induced by accelerating inflation and naira scarcity, it has been a chain of problems for the poultry industry since 2020”, the Director General of the Poultry Association of Nigeria (PAN), Sunday Onallo-Akpa, lamented while speaking to our correspondent.
Though, the poultry industry had been experiencing serious challenges for some years now, findings revealed that the problems have been exacerbated by the recent naira redesign policy of the Central Bank of Nigeria (CBN) which almost crippled the sector.
According to affected farmers, who agreed to speak on the development, the naira redesign policy of the CBN, which later turned to acute currency scarcity, is the last straw that broke the camel’s back.
BH reliably gathered that at the peak of the currency scarcity in February, millions of Nigerians totally removed poultry products from their already depleted diets as they could not afford or source for funds to purchase them.
Those lucky to get the scarce cash, meanwhile, opted for cheaper alternatives like smoked fish and skin hides (popularly called Ponmo).
Expectedly, the poultry industry took a direct hit from the shock. According to available figures, the industry has lost about 25 million crates of eggs and chicken since the scarcity began.
For instance, farmers lost over N30 billion worth of unsold eggs, which were later destroyed in the first three months (January to March) of the year due to glut.
The DG, Poultry Association of Nigeria (PAN), Onallo Akpa, said farmers suffered monumental losses as a result of the crisis created by the CBN naira redesign policy.
“The average loss to the poultry industry was over N30 billion. Except for some measures of immediate intervention taken by the Federal Government, the poultry industry in the country is on the verge of total collapse.
“Most of the poultry farmers are now debtors to commercial banks and suppliers of raw materials and other services”, the PAN DG lamented.
Though, the debilitating naira scarcity has substantially eased with the flooding of banks vaults and ATMs with cash by the CBN, many Nigerians, findings revealed, are not enthusiastic about returning to the consumption of poultry products.
Some Nigerians in Lagos, who spoke to our correspondent blamed their decision on the high cost of poultry products, compared to other sources of protein.
For instance, while a kilogram of Titus Kote, and Sawa presently sell for N2,000, N1,600 and N1,300 respectively, a crate of egg goes for between N2,200 and N2,600 depending on the size.
In the retail market, one piece of egg sell for N100, while an average piece of smoked fish, popularly called Eja Egun, goes for N100, with bigger sizes selling for between N150 and N200 per one. Also, imported frozen chicken (Orobo) in neighbourhood markets sells for between N2,500 and N2,800 per kilogram, depending on the location.
Many Nigerians, especially the commoners, disclosed that they have embraced smoked fish and imported frozen chickens (when they could afford it) in place of eggs.
“Before now, egg was a substitute for meat. I am talking of when we bought a crate for between N600 and N900, depending the size.
“We used to buy one egg at that time for N30, while two sold for N50. And am talking of 2020/2021.
“All of a sudden, prices per one shot up to N50, then N70, N80 and now N100.
“Apart from the rich, how many Nigerians can afford that? What we now take as meat supplement is smoked fish or ponmo (hide)”, declared Taiwo Ogunbande, a private school teacher in Agbado, Lagos.
Some economists who spoke on the development described what happened as change in ‘taste and fashion’.
According to the Fundamentals of Economics for SSCE, NBCE, UTME and Similar Examinations written by R.A.I Anyanwoucha, while change in the taste of a commodity is the decision of a consumer to abandon a product for another due to several reasons, change in fashion is the demand for products, which are in vogue.
An economist, Peju Fisher, explained that when consumers’ taste suddenly change, it is not easy to reverse, except by an equally matching force to the one which triggered the change in the first place.
“Consumers all over mostly go ‘one way’. When prices of goods change, there is a very high likelihood that people’s taste and preferences will change.
“However, the reverse is the case when stability returns. For instance, let’s say Nigerians prefer Close Up to Maclean toothpaste, in the event that the price of Close Up goes up, many will switch over to Maclean.
“When Close Up price revert to its old price, many would still not go back to the product, except there is a major price slash, or if Unilever embark on a massive publicity blitz to win over lost market
“That is what is happening in the poultry industry. It will take a major shock for consumers to go back to bringing back eggs and chickens to their tables unless they are encouraged”, declared Fisher.
Another challenge confronting poultry farmers in the country is the outbreak of bird flu across the country.
According to the Federal Ministry of Agriculture and Rural Development, over 300 poultry farms have been shut down between January and April 2023, owing to the outbreak and spread of bird flu in the country.
The disease is highly contagious and lethal, particularly in domestic poultry.
The ministry further stated that it destroyed 1.6 million birds out of the infected 2.01 million in 28 states and the Federal Capital Territory (FCT).
Sources in the ministry informed our correspondent that most affected farms have shut down operations and may not likely recover from the effects of the plague.
Speaking on the outbreak, the Director/Chief Veterinary Officer of Nigeria, Dr. Maimuna Abdullahi Habib, said bird flu is not synonymous to Nigeria but had become endemic.
“We have met at regional and international levels, and we have decided that the Federal Government should change its policy from no vaccination to vaccination”, Habib said.
While poultry farmers were busy battling the twin scourge of currency scarcity and bird flu, another major headache in the form of insecurity is pushing the sector to the brink.
According to reports, attacks on farmers as well as their kidnappings by bandits and terrorists, especially in Benue, Borno, Taraba and Kaduna have recently been on the rise.
Faced by constant attacks and harassments, which often times lead to unfortunate deaths, many farmers had abandoned their farms, leading to their collapse.
Though, many poultry farms have gone under largely because of attacks from bandits and militants, the majority of affected farms are allied grain farms involved in the cultivation of maize, soya beans, millets, sorghums and other raw materials needed for poultry feeds.
As a result, the prices of maize and other grains which are the major materials in animal feed production has skyrocketed, leading to the high cost of chicken meat and eggs.
“Farmers, especially poultry farmers, are in trouble in this country. Insecurity is our major problem. It has driven up the cost of poultry products beyond the means of ordinary people.
“Once the bandits see you have a farm with good structures like chicken sheds, they target you and demand huge ransom.
“Apart from the fear of being killed, where will my family get millions of naira to pay ransom if they kidnap me?
“I am a retired civil servant, who pumped all my entitlement into the poultry farm. But I am not stupid. I value my life more than the investments in the farm.
“I have abandoned the farm and killed all the birds for meat until when the security situation in the country improves”, said Mr. Oluseyi Oke, a poultry farmer in Esa Oke, Osun State.
As a result of the continued shut down of poultry farms, at least 2,500,000 jobs have been lost in the sector, with another 5,000,000 poultry jobs said to be on the line.
Meanwhile, concerned poultry farmers have called for urgent government intervention in the sector, arguing that thousands of poultry businesses will soon shut down, leaving business owners and their employees without means of livelihood.
The Chairman, South West chapter of the Poultry Association of Nigeria (PAN), Rev. Gideon Oluleye, while calling on the Federal Government and the Central Bank of Nigeria to save their businesses from collapse, maintained that the losses incurred by farmers are heavy and that many farms have already collapsed with others running below capacity.
According to Rev. Oluleye, polices such as increment in interest rate, security challenges across the country as well as the naira redesign policy had affected the industry negatively.
To ameliorate the glut in the industry, the PAN boss implored the government to re-introduce the school feeding programme in order to mop up some of the unsold eggs and chicken meat from farmers.
He also called on the government to subsidize major farm inputs, particularly maize and soya bean needed in poultry feeds production.
“In order to save the poultry sub-sector of the economy,! which is generating about 6% of the G.D.P from total collapse, the Federal and state Governments, the Central Bank of Nigeria and all other agencies of government concerned, must rise up and intervene in this sub-sector of the economy. The intervention should come in the following areas;
“Mopping up of about 15 – 20 million crates of eggs and chicken unsold in the economy right now to ameliorate the losses of the farmers.
“These products should be used in feeding the people in IDP’s and all our correctional centres all over the country.
“Some could also be used in government hospital where meals are served as eggs helps in quick recovery and in building up immunity of sick patients.
“We also want the Federal Government as a matter of urgency to resuscitate the school feeding programme as eggs and chicken meat form the major component of the programme.
“This will go a long way in absolving some of the eggs and chicken meat from the farmers.
“We are also pleading with the Federal, states and the Central Bank of Nigeria to intervene now in subsidizing major imputes particularly maize and soya much more than they have been doing before.
“This will also help in ameliorating the negative impact of the naira redesign policy of the government on the farmers.
“A lot of farmers are running on loan and as a result of this crisis, they could not meet their loan obligation any more.
“We want the CBN and the Federal Government to help in defraying part of the loan and in some cases out right cancellation of the loan. This will enable farmers to recover and save the sector from collapsing”, PAN demanded.
Meanwhile, several state governments have been coming to the aid of poultry farmers in their states in their bid to ameliorate their challenges.
In April, the Lagos State government through the state Ministry of Agriculture, mopped up 300,000 eggs from the Erikorodo Poultry Estate in Ikorodu.
According to the state Commissioner for Agriculture, Ms. Abisola Olusanya, the intervention was aimed at addressing the recent egg glut in the poultry sector.
She stated that the intervention came after weeks of visitations and negotiations led by the commissioner and other senior ministry officials toward ensuring that all parties were in agreement to modalities of the off-take.
In the same vein, the Plateau State Government recently bought 5,000 crates of eggs from the Poultry Association of Nigeria, Plateau branch, to alleviate farmers plight due to the glut of eggs.
The state Governor, Simon Lalong, said the mop up was the first intervention of the state government in addressing the issue of egg glut in the state.
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