At a poultry farm in Ijede, in the Ikorodu area of Lagos, over a dozen men hand-pick eggs every day from the battery cage into crates. The eggs are later sorted and arranged in sizes to be supplied across the city.
The poultry farm, with a capacity of 5,000 layer birds, was established 20 years ago by two brothers and is producing thousands of eggs daily for households, restaurants, and street traders.
But declining demand for eggs, supply chain disruptions, high cost of feeds, foreign exchange scarcity, avian influenza, and accelerating inflation are threatening the farm’s existence.
“Monthly, the prices of feeds, vaccines, and drugs and all things we need for our poultry farm keep increasing,” said Bolaji Adeniyi, farm manager of Adetops Farms, the poultry business.
He said FX scarcity has made the prices of vaccines and drugs for livestock to double.
“Currently, accelerating inflation and the cash crunch is causing low demand for eggs and chicken,” he said. “We have been experiencing different shocks since 2020 after the pandemic outbreak. And when we try to stand from one shock, then a new one comes and knocks us down again.”
Adeniyi’s situation is similar to what millions of poultry farmers are going through across the country. The situation has eroded the gains the industry recorded during the 32-month border closure that started in August 2019.
It has also resulted in a massive loss of jobs in the subsector, which is among the subsectors creating the most jobs in the country’s agricultural sector, according to experts.
“From 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,” said Sunday Onallo-Akpa, director general of the Poultry Association of Nigeria (PAN).
“Lots of farms are closing down owing to these challenges,” he said, adding that the government restriction on smuggling of frozen poultry products during the border closure is not sufficient to support the industry owing to the myriad of challenges farmers are contending with.
According to PAN, the industry lost N1.5 trillion in 2020 owing to the pandemic and N30 billion in 2023 due to naira scarcity. Growth in the poultry industry has continued to slow from 1.70 percent in 2020 to 0.61 percent in 2022, according to data from National Bureau of Statistics (NBS).
The high cost of key inputs such as vaccines, drugs, and feeds across the country is frustrating farmers who are currently struggling to survive inflationary pressures.
Nigeria’s Inflation accelerated to 21.91 percent in February, data from the NBS show. The continuous surge in the prices of goods and services has made many Nigerians poorer, with 63 percent of the population (133 million) suffering from multidimensional poverty.
The surge in inflation has eroded consumers’ purchasing power and forced many Nigerians to cut down on purchases. The situation was further compounded by the naira scarcity that started in January.
The prices of vaccines and drugs have also increased owing to foreign exchange (FX) volatility as most of them used in the country’s livestock industry are imported.
Naira, which was 360 to a dollar at the black market before the COVID-19 outbreak, has skyrocketed to 745/$1 as a result of dollar scarcity in the country due to low oil production.
Nigeria depends on crude oil for over 70 percent of its FX needs and revenue, according to the NBS.
Poultry farmers’ woes were further compounded when the Federal Ministry of Agriculture confirmed in January the outbreak of avian influenza in 28 states and the Federal Capital Territory.
The figure released by the ministry indicated that over a million birds were affected and depopulated, and more than 110,000 crates of eggs destroyed.
Read also: Poultry farmers lament low demand for eggs amid naira scarcity
The industry suffered another blow as petrol and diesel prices surged. Poultry farmers use petrol or diesel to power their generators for farm operations. These generators are used chiefly to run water pumps to keep the birds hydrated and heat to maintain their body temperature.
With prices of these commodities at almost sky-high levels, poultry business is becoming unprofitable and many farmers are unable to break even.
“We now spend N12,000 on fuel weekly if our power outage is frequent. Before now, we used to spend between N2,500 and N4,000 weekly,” Maria Ogunkomaya, a poultry farm manager at Goalsquare Farms, told BusinessDay. “However, when there is steady power from the grid, we spend about N5,000 weekly.”
Ogunkomaya confirmed that the high cost of petrol has doubled her production cost. “Presently, there is no profit. I pray that when we sell our eggs, the money we gather will be able to feed our birds.”
Data obtained from NBS show that the average price of petrol increased by 54.76 percent in 12 months to February 2023.
To cope with rising costs, the farm manager told BusinessDay that they put on their generator for about 1-2 hours now, unlike before when they used to leave it on for about 3-4 hours for their staff to relax.
