Poultry industry stumbles in Nigeria as operational costs take heavy toll on farmers

Onome Amuge

The poultry sector in Nigeria, renowned for its robust commercialisation, is a vital pillar of the livestock subsector, boasting a staggering population of 563 million birds and accounting for more than a quarter of the country’s agricultural GDP. However, the industry’s success has recently been jeopardised by the combination of rising insecurity and unpredictable weather patterns, which have profoundly affected crop production, causing an unprecedented surge in feed prices and casting a looming shadow of uncertainty over the sector’s survival.

The astronomical cost of feed, which constitutes a significant chunk of production expenses, has left poultry farmers in Nigeria struggling with diminishing profit margins. This situation has led many farmers to downsize their operations or quit altogether, resulting in high number of job losses across the industry.

According to the Poultry Association of Nigeria (PAN), the sector has experienced a debilitating loss of 25 million jobs over the past four years.

Furthermore, consumers are now facing the adverse effects of this crisis, with the prices of poultry products skyrocketing, which has become a cause for concern among Nigerians.

Despite the federal government’s waivers for maize importation, the production cost for chicken feed remains prohibitively high, threatening a further collapse of the industry. Maize is a primary ingredient in feed production for birds.

As feed prices climb, poultry farmers have had no choice but to pass on the additional costs to their consumers, leading to a marked increase in the prices of eggs and chicken. The rise in prices of these essential sources of protein has become a source of great concern in a country already contending with rampant poverty. Added to this is the issue of foreign exchange shortages, which hinders the importation of vital inputs, further threatening the stability of the poultry sector.

Recent market trends have revealed a significant hike in chicken and poultry product prices over the past two years. According to current market reports, a crate of eggs now sells at between N5,000 and N6,000, with individual eggs costing anywhere from N150 to N200, depending on their size.

Similarly, chicken feed prices have skyrocketed, becoming exorbitant over a short period. This is as a 25kg bag of Growers Mash (Hybrid Brand), which previously sold at N5,000, is priced at N8,000 and above at the time of filing this report.

The tough business environment has left poultry farmers in Nigeria struggling to stay afloat, as confirmed by Omidokun Oyekunle, the chairman of the Poultry Association of Nigeria, Oyo State chapter.

Oyekunle shared a heartbreaking insight, revealing that nearly half of the poultry farmers in the state have been forced to abandon their businesses due to the insurmountable challenges they face.

Expounding on the struggles faced by poultry farmers in Oyo State, Oyekunle, revealed in an interview with the News Agency of Nigeria (NAN) in Ibadan that one of the key challenges confronting these farmers is the elevated cost of poultry feeds, with maize and soybeans, which are essential constituents of poultry feed production, proving to be the major sources of the rising costs.

In his words: “Majority of poultry farmers are no longer using the new maize because of its moisture content; it will affect production and the eggs of the birds.”

“What those who are using it do is that they grind it, spread it and wait for about five days and even add some preservatives, but the weather is not favourable,”

“This is a major problem confronting us, especially when you look at the production cost and the amount we sell eggs. You will find out that there is no enough profit margin to keep the business running and that is why poultry farmers are closing down and cost of eggs increasing.”

Oyekunle did not shy away from mentioning that the influx of frozen chicken imports was negatively affecting the prices of locally produced chicken in the market, warning that this trend must be halted to ensure the sustainability of the poultry industry in Nigeria.

However, he commended the federal government’s decision to allow the importation of maize, expressing hope that this would eventually lead to a reduction in production costs and encourage more people to return to the poultry sector.

Recent reports reveal that the federal government has given the green light for the importation of approximately 100,000 metric tonnes of maize from Argentina as part of an effort to support the struggling poultry industry. Despite this development, poultry farmers maintain that the cost of feed and poultry drugs remains the most pressing issue plaguing the sector.

Feeling the strain of rising feed costs, poultry farmers have expressed dissatisfaction with the current system of importation, with allegations that only a handful of individuals are granted licenses for importation, and that these importers are primarily concerned with maximising profits rather than meeting the needs of farmers.

Mojeed Iyiola, chairman of the Poultry Association of Nigeria’s Lagos chapter, also voiced his concern in a report, stating that the licenses for the importation of maize are granted only to a chosen few, who selfishly prioritise their own profits over the needs of the poultry farmers and feed processors.

According to Iyiola, even when these few importers sell their imported maize to poultry farmers and feed processors, they offer no concessions, charging the same prices as the open market, leaving poultry farmers without any relief from the high cost of feed.

On the other hand, Kabir Ibrahim, president of the All Farmers Association of Nigeria (AFAN), corroborated that the poultry sector had indeed received a helping hand in the form of the importation of approximately 100,000 metric tonnes of maize, intended to offset the scarcity of maize in the local market. He also noted that maize was recently granted a zero tax waiver on importation by the federal government, providing some respite to the beleaguered poultry industry.

Ibrahim brought attention to the pressing challenges besetting the poultry sector in Nigeria, with particular emphasis on the skyrocketing costs of feed production and poultry drugs.

Addressing these challenges, the AFAN president urged the government to provide sustainable subsidies for feed and drugs, noting that such a move, combined with the reactivation of school feeding programmes, would provide a much-needed boost to the poultry industry.

Joshua Onuche, a poultry farmer and CEO of Layonder Farms in Nasarawa State, provided a firsthand account of the challenges confronting poultry farmers in Nigeria. Despite the current high prices of eggs, Onuche explained that the cost of production is so high that farmers are still not getting a fair return on their investment.

“Despite the current high prices of eggs, when you consider the enormous expenses incurred during production, from the cost of poultry feed, micro ingredients, electricity, transportation, water, and many more, you realize that we are still not getting a good return on our investment,” Onuche lamented.

Onuche further disclosed that his business has been dealt a severe blow by the soaring costs of poultry feed over the past year.

According to him, the escalating prices of poultry feed have been driven by the continuous increase in prices of key ingredients such as maize and soybeans in the market, creating a vicious cycle for poultry farmers like himself.

Onuche underscored the vital role that the government must play in securing the future of the poultry industry in Nigeria, emphasising the urgent need for increased support for farmers, researchers, and extension agents to stimulate local crop production and, in turn, boost the profitability of the sector.

“Empowering these key stakeholders will result in improved yields of maize and other crops used in poultry feed production, reducing our reliance on expensive imports and alleviating the burden of high feed costs,” he added.