Local quality commercial feed capacity hits 100,000mt.- PIND Foundation
by ISAAC ANYAOGU
March 7, 2018 | 12:23 am| | | Start Conversation
Local manufacturing capacity of fish feeds in Nigeria has reached a record high of 1000,000 metric tons in 2017, says a recent study conducted by the Foundation for Partnership Initiatives in the Niger Delta (PIND), a non-governmental organisation that is funded by Chevron.
The study which was an update of an earlier one conducted in 2012, states that despite the increase in the country’s fish feed production, the market is still largely met by inefficient, low quality and homemade feeds.
This has limited farmer’s ability to increase their productivity and improve livelihoods, as feeds constitute 70 percent of operation cost in aquaculture production in the country.
“The single most important input in fish farming is good quality fish feed, which represents 60-70 percent of the cost of operations. This underscores the importance and interest in developing and growing the fish feed industry,” according to PIND.
The total volume of feed consumed in Nigeria in 2016 was estimated at about 507,000 MT out of which 93percent or 473,000 MT was supplied by local producers broadly categorised into four main groups including micro/on-farm feed producers, small commercial producers, medium producers and large industrial producers. The remaining 7 percent (33,000MT) was met by imports.
The study also found that the micro/own-use farm made producers dominate the market as they produce as much as 70 percent of the feed consumed in the sector. These feeds are mostly poor quality inefficient feeds. Large producers account for 10percent (51,000) of the market while small and medium producers are estimated to supply about five and eight percent respectively.
The Niger Delta market accounts for about 30 percent of the total feed market going by data obtained from some of the large producers.
Prior to 2015, the fish feed sector witnessed an average yearly growth of 9percent, but by 2016 growth was stagnant. “This was caused by the devaluation of the naira which led to an increase in the prices of most goods and services, particularly imports. As result, prices of imported feeds increased significantly leading to a shift in demand for locally produced feeds.
This led to a 7percent decline in imports and an increase in the demand for better quality feed produced by large and medium producers. The local industrial producers responded by expanding their production, hitting almost 100percent capacity utilisation of 50,000 MT at the end of 2016,” says PIND.
The study said new brands of cheaper imports (such as Aller Aqua) as well as new industrial processors (such as Olam’s new mill in Ilorin) are entering the market that is looking for quality, price competitive feeds.
“Production can expand further to meet the unmet demand for quality feed. This can be done by local quality production or by cheaper imports of quality feeds. There is also the opportunity to substitute for more imports which has not been happening as much as it should, because the productive capacity of large producers is at 100percent utilization while the well-structured regulated emerging small producers are constrained by investment capital to expand production.
To improve the effectiveness of the sector and make quality, price competitive feed available to fish farmers, PIND recommends that: ‘Fish farmers have increased access to a growing and competitive supply of high quality feeds that meet NAFDAC standards, leading to increased productivity of fish farmers”.
According to PIND, four critical actions are now required: promote the value proposition for investment in large scale production; support to the growing SME channel of feed producers to attract expansion capital and improve their feed quality; increase information to (large) on farm producers of feed on the benefits of shifting to more efficient, higher quality feed; and continued data collection and monitoring of changes in the sector to share the information on investment opportunities and changing dynamics.
Local fish production in Nigeria is estimated at 1.034 million MT per annum made up of aquaculture, artisanal and inshore fishing. Aquaculture or fish farming accounts for about 30percent of total production at around 316,000MT.
PIND was established by Chevron in 2010 to build partnerships for peace and equitable economic development in the Niger Delta region of Nigeria. The overarching goal of the partnerships is to reduce poverty and increase socio-economic benefits by implementing interventions that address the root causes of conflict and poverty in a localized and sustainable manner.
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