What Ban On Maize Importation is doing to Poultry Production

‘The poultry sector is one of the major consumers of maize as it is a key ingredient in poultry feed and accounts for 70 per cent of production cost. The poultry industry is worth N10 trillion but is losing N1 trillion. The industry is next to IT in value

Nigeria is the 10th largest producer of maize in the world, and the largest maize producer in Africa, followed by South Africa . While maize is grown in the entirety of the country (both yellow and white varieties), the North Central region is the main producing area.

Seventy percent of farmers are smallholders, with an average 5 ha area of cultivated land accounting for 90 percent of total farm input. Maize in Nigeria is usually intercropped, with yam, cassava, guinea corn, rice, cowpea, groundnut, and soybeans.

The Central Bank of Nigeria, on July 13, 2020,restricted access for importation of maize through the official CBN forex window. It hinged its decision on the need ‘to increase local production, stimulate a rapid economic recovery, safeguard rural livelihoods and increase jobs which were lost as a result of the ongoing COVID-19 pandemic’. Prices of poultry and fish feed have increased across the country weeks after the Central Bank of Nigeria stopped the issuance of forex for the importation of maize. Traders and farmers attributed the hike in prices to the scarcity and sudden increase in the cost of the grain. Nigeria, over the last 10 years, has imported some 33,000,000 tons of maize because importers get maize at a cheap price outside Nigeria and decide to import. In 2019, Nigeria produced 11 million metric tons with a demand level of about 15million metric tons, according to the data from USDA

The food industry is bracing for major adjustments as concerns over the impact of Central Bank of Nigeria’s (CBN) ban on maize import grow. While the extent of the ban’s impact remains uncertain, production disruption is a major area of focus. Some stakeholders fear that the CBN’S ban of maize import when local farmers have not produced enough to power the food industry will lead to high cost of the crop, which is a major raw material in livestock and pharmaceutical industries. Higher projected orders from the food processing industry have sent maize prices soaring with supplies plummeting. With the ban on maize importation, analysts say food industries are paying more for maize and that is as a result of farmers and middle men hiking the prices to take cash in the opportunity.

Impact on Poultry Sector

The poultry sector is one of the major consumers of maize as it is a key ingredient in poultry feed and accounts for 70 per cent of production cost. The poultry industry is worth 10trillion naira but is losing N1 trillion. The industry is next to IT in value but is now on the verge of collapsing because:

• Cost of feed in the past has shot

up as maize is a key ingredient in poultry feed and accounts for 70 per cent of production cost.

• Access to raw materials will be

affected as prices go up and maize farmers are trying to scale up production and value

• Producers have not been able to

pass on the high costs to consumers, as such, they have continued to reel under the impact of higher production feed costs as current cost of production is at par with sales price so they get no profit.

Many believe that the ban was ill timed because poultry farmers were still counting their losses from the near-closure of businesses due to restrictions imposed by federal and state governments to stem the spread of Covid-19.because of the ban, a ton of maize,

which sold for ₦80,000–₦120,000 had climbed to₦160,000-₦180,000 while a ton of soybeans have increased from ₦110,000 to ₦123,000 in the last few months. Maize prices have soared to an all-time high in the market because of weak supply. The price control board is necessary to control maize prices and this should have kicked in with the price increase of maize since import was banned.

Poultry farmers cannot produce chickens cheaply without subsidies. So far, farmers harvest two major corn crops yearly. For this reason, the biggest worry for the poultry players is there’s unlikely to be any respite from higher feed prices over the next five months, when the new maize crop arrives into the market. Prices have always been unstable and the changing climate and Covid-19 creates a perfect storm to drive prices up.

Alternative carbohydrate sources such as cassava has been researched on but results have not been translated into use, thus, import seems to be the way out. Other carbohydrate alternative includes sorghum, wheat, and millet and corn bran.

FEAR OF Aflatoxin

While farmers and food processors are encouraged to use existing stocks, another concern is that poor storage of maize during the lockdown would have caused it to be infected by aflatoxin, a toxin caused by mold. Apart from the lack of storage infrastructure, the heat and humidity ensure that corn is easily damaged by mould, some of the maize might have become unfit for human consumption as they have been contaminated by aflatoxin, known to cause cancer and other health problems. The loss comes when the country is still struggling with the coronavirus pandemic, which have adversely affected its food chain as markets were closed and movement restricted.

International Commodity PRICE UPDATE

Proffered Solutions

1.Poultry stakeholders can take advantage of the Central Bank of Nigeria’s agricultural schemes.

2. Stakeholders and farmers in the poultry sector can come together to discuss, draw a conclusion and write preferred strategies to be include in a policy.

3. Government and/or NGO’S can set up enough cassava peel processing centres in the rural areas for the local farmers.

4. Farmers should take water management seriously as a way of coping with the changes in the climate

5. Policy makers should involve everyone in the poultry system before a policy is implemented...

6. Poultry stakeholders can take advantage of the cassava peel as a feed alternative in providing carbohydrate for the animals. Research has shown that poultry do very well with cassava peels in their feed, sheep and goats even prefer feeds with cassava peels as a component.

7. Government should make available mechanical dryers at subsidized rates to cassava peel processors.

Story source: ag ra innovate west Africa newsletter september 2020.