The Nigerian poultry industry is struggling as rising feed costs and price controls from processors dramatically reduce farmers’ profits. An economic crisis, exacerbated by the removal of fuel subsidies, has led to increased production expenses and low profit margins, threatening sustainability and causing farmers to cut back on production. Urgent government intervention is necessary to prevent a shortage and stabilize the sector.
Nigerian poultry farmers are facing significant financial pressure due to escalating feed costs, which have risen from N25,000 to N27,800 since December. Despite increased production costs, poultry processors are limiting the prices farmers can charge, leading to minimal profit margins. Currently, farmers make only N200 profit per bird, which is insufficient for sustainability, especially as many reduce their output.
The current crisis is linked to Nigeria’s economic issues, particularly the removal of fuel subsidies in May 2023 that caused transportation and food price hikes, intensifying inflation. Essential poultry feed ingredients, including maize and soybeans, have also become considerably more expensive. Although there is a ban on poultry imports to boost local production, rising costs threaten the viability of domestic farming operations.
With financial challenges mounting, many farmers are cutting back production, raising concerns about a potential poultry shortage. Factors contributing to increased feed prices include supply chain disruptions and climate change, alongside Nigeria’s persistent high inflation rate. Since many feed ingredients are imported, currency fluctuations further inflate local prices.
Mojeed Iyiola, Chairman of the Poultry Association of Nigeria (PAN), highlighted how raw material prices have driven up feed costs. PAN has requested government permission for direct maize imports in order to eliminate inflated middleman prices that burden farmers. Meanwhile, processors enforce price controls, restricting farmers’ ability to respond to rising production costs.
Processors often have agreements that allow them to purchase feed at lower rates and resell it to contracted farmers, limiting price flexibility. To mitigate losses, some farmers have sought alternative revenue through the sale of used feed sacks and poultry waste. They urge governmental action for subsidies or price controls to stabilize the poultry sector.
With nearly half of Nigeria’s poultry farmers already affected by these rising costs, urgent government intervention is necessary to avert further industry collapse and ensure the sustainability of the domestic poultry market.
The Nigerian poultry industry is currently facing a significant crisis driven by soaring feed costs and stringent price controls imposed by poultry processors. These economic challenges have been compounded by the broader context of Nigeria’s economic issues, including inflation and the recent removal of fuel subsidies, leading to increased transportation and food prices. The poultry sector, vital for food security and economic stability, finds itself at a tipping point due to the rising costs of primary feed ingredients such as maize and soybeans, inflicted by both local and global economic factors.
In summary, the Nigerian poultry industry is under severe strain from rising feed costs and restrictive pricing by processors. Farmers’ profit margins are exceptionally low, prompting many to reduce production, which could lead to shortages. The situation calls for immediate government intervention to provide subsidies and adjust policies that will stabilize prices and support local poultry farming in Nigeria.
Original Source: newscentral.africa
