Chicken prices triple as producers, processors list causes

PAN laments the cost of production, urges for intervention

A survey by The Guardian has revealed that Nigerians are groaning over the prices of poultry products, especially dressed and live chickens, as inflation escalates and ‘chicken change’ can no longer buy chicken in the country.

Poultry producers, processors, millers and chick hatchery operators have also listed challenges forcing prices upward.

The situation may lead to more cases of malnutrition and protein deficiency among children and women as other sources of protein become unaffordable to most households.

A kilogramme of smoked chicken at SPAR, a popular city supermarket, as of the time of survey last week, was N2,870, while another brand, fresh chicken was N2,490 per kilogramme.

Also at Shoprite, 1.1kg of chicken was sold at N3,280 as of the time of the survey.

However, at neighbourhood food markets and street frozen food outlets in Lagos, frozen chicken is sold at N2000 per/kg.

Comparatively, from 2018 to 2019, the price per/kg was N700 and N800, and in 2020, a kilogramme of chicken was at N1,450 in the corresponding period, while in 2021, according to Statista, it was N2,110.

Now, the price per/kg ranges from N2490 to N3,280, depending on the vendor and location.

A medical practitioner with an international agency and public health researchers, Dr Olalere Olajide, said constant food inflation, especially sources of protein and micro-nutrients, could have a great impact on public health, and induce disease burden on the government and aggravate infant malnutrition, morbidity and mortality rates.

Meanwhile, stakeholders have identified the higher cost of feed inputs, expensive finished tolled feeds, higher cost of diesel, logistics and insecurity as challenges fueling price hikes.

A chicken hatchery owner and Managing Director of Terudee Farms, Ibadan, Oyo State, Mr John Olateru, who is also a former chairman of the Poultry Association of Nigeria (PAN) in the state, said the higher price of chicken is an aftermath of production chain challenges.

Explaining, he said: “The cost of poultry feeds keeps going up. This affects the cost of producing broiler day-old chicks, coupled with the cost of running hatchery through generators and diesel.” 

He said the cost of rearing broiler day-old chicks, which are raised into dressed chickens between four and six weeks, is exorbitant. 

“All these add together to contribute, in no small measure, to the pressure on the price of processed chickens,” Olateru said.

Another big player in day-old chick and dressed chicken producer in Nigeria, who demanded anonymity, also corroborated Olateru’s lamentation on the cost of feeds, power and other critical inputs.

He said: “Cost of maize went extremely high due to speculators. Maize is 50 per cent of the poultry ration. It has come down a bit now but might still go up. But soya production quantity is also insufficient. The government should restrict export as done in other countries. Where demand is higher than supply, the government can augment deficit in reserve price.”

Cost of independent and alternative power generation is also affecting production cost and pricing.

He added: “Diesel cost has increased from N250 to N700. Many farms have closed down. So, demand is getting higher for chicken, but purchasing power is causing lower demand for eggs. Distribution (logistics) prices have gone through the roof.”

Chief Executive Officer, Adonai Farms, Ijebu-Ode, Itodo Innocent Idoko, said: “Factors responsible for higher prices are high cost of feed: maize skyrocketed from N90 to N285 per kilogramme between 2019 to 2021; soya meal from N130 to N380; groundnut cakes (GNC) from N95 to N370; and methionine from N25,000 to N68,000 per bag, among others.

“Price of point-of-lay pullets jumped from N1,200 to N1,800; 16-week-old pullet that was N1,400 is now N2,600. 

“These and other factors, like an outbreak of bird flu and brain drain, have all contributed in no small measure to the higher cost of poultry production.”

Also, General Manager, Tuns Farms Ltd, another major poultry producer in Oshogbo, Mr Taofeek Badmus, said the persistent rise in the cost of feeds and feed ingredients is squeezing margins for livestock and poultry producers, and hence, consumers may have to share in the burden of rising cost.

“Inconsistency in the quality of finished feeds, as feed makers tend to maximise profit at the expense of feed quality by substituting more preferred feed ingredients with fewer nutritive materials, is a challenge,” he said.

Badmus said apart from a direct impact of insecurity on the feed business, the poultry farmer is a soft target of kidnappers as farms are located, in most cases, in less secure vicinities.

This, he argued, directly reduces the number of active farmers and makes a fewer number of birds from the remaining farmers a hot cake for processors.

He also identified “High cost of overhead, such as diesel, power, increase in the cost of living and non-availability of forex for basic imports” as serious factors affecting the prices of poultry products.

“The sudden increase in demand for chicken with notably decreased consumption of beef, especially in some parts of the country, is another factor driving the high cost of chickens,” he said.

Corroborating Olateru’s argument, Badmus said: “Hatcheries have come under pressure as the cost of feeds, electricity and heating for the incubation period have gone up, and we are passing same cost pressures on farms.”

“The farm gate prices for the average live weight of chicken,” he said, “is also difficult to regulate as cost of production seems to differ evidently among producers.”

MEANWHILE, the Poultry Association of Nigeria, Lagos State chapter (PANLAG), has called on the government to intervene in the sector as prices of feed components are forcing hundreds of poultry farmers to suspend production.

It was revealed that as of 2020, maize was sold for N160,000 per tonne, but today, the same tonne of maize is being sold for N270,000.

The call was made at a two-day symposium organised by PANLAG at Lagos State Polytechnics, Ikorodu, recently.

Tagged, ‘Post COVID-19 Effect on Poultry Industry and the Way Out,’ the symposium brought together both farmers, input dealers and feed millers.

The chairman of the association, Godwin Egbebe, said to ensure reduced cost of poultry production, the government should intervene by releasing grains from the national reserves.

Egbebe said: “We want the government to re-introduce the intervention of the Central Bank of Nigeria (CBN), which took place in 2020 and stabilised the industry for a long while.

“We are also pleading with the government to ensure the safety of farmers as the issue of banditry and attacks have made it difficult for some of them to operate freely on their farms, thereby causing a shortage of products in the market.”

He added that though the COVID-19 pandemic affected all sectors of the economy, the effect on poultry was more devastating because the business is more volatile compared to other businesses.

“Even the customers know that we cannot keep our products for long. It, therefore, gives them the opportunity to price at unreasonable rates.

“I urge all poultry farmers across all regions to keep their heads high and stay afloat as there is light at the end of the tunnel,” he said.

Going further, Egbebe noted that cases of cancer, which have skyrocketed in the country, could be traced to the smuggling of frozen chickens, which comes in through the Benin Republic border to Nigeria.

He said: “The Benin Republic government is aware of this situation and they are ready to collaborate with us because they know of a fact that the majority of the smuggled chickens that gain access into Nigeria comes in from their border and it is not targeted at their people but the Nigerian market.

“For this reason, they are here to collaborate with us so that we can give them some of the inputs like the day-old chicks, and they will raise the birds and bring them back to us to buy.”

The representatives of Benin Republic, led by the President, of the Poultry Association of Benin Republic, Mr. Constant Kenoukon, said that they came into the country to discuss collaboration with PANLAG in terms of buying day-old chicks from Nigeria.

He noted that Beninese is also experiencing the same issue that Nigerians are facing over the imported frozen chicken.

“We are not the ones that produce these chickens; they are imported into our country through another country. They just package from Benin to Nigeria.

“We are making efforts to stop the importation of these frozen foods and that is the reason why we are here to liaise with Nigerians on how we can be getting day-old chicks, rearing them and producing livestock feeds,” Kenoukon said.

He revealed that at the moment, they source day-old chicks from France and Holland and it has become too expensive for them.