Is Covid-19 really responsible for the glut in Nigeria’s poultry industry?
Nigeria’s poultry industry focuses primarily on chicken production (meat and eggs). The country produces an estimated 10.3 billion eggs annually, making it the largest producer in Africa. Despite this huge capacity, it cannot be said that every Nigerian eats eggs whenever they want. The reality is that year after year, poultry farmers are forced to bury tons of unsold eggs while counting their harsh losses.
A glut is a state of oversupply, overproduction, or an excess of supply over demand. This market condition forces a reduction in prices, and in cases where the products are perishable, it leads to wastage.
This disheartening situation is exemplified by the story of Mr. Taiwo Obabiyi, an elderly poultry farmer who used his pension to stock layers for egg production. At first he enjoyed a high production rate of close to 90%, with takers (mostly female egg retailers) coming in good numbers.
Then Covid-19 happened. All of a sudden, most of his regular buyers stopped coming due to the lockdown. His eggs rotted away, and he watched aghast as his workers had to bury them. He sold off these layers before they were ready to be culled and swore never to return to agriculture. This sad story is a microcosm of the trend in egg production and distribution in Nigeria, especially among small- and medium-scale egg producers.
At this juncture, it is important to note that despite the pandemic, there has been no real reduction in demand for eggs, as they remain one of the cheapest sources of animal protein in Nigeria. Some market journals have however reported that the observed “artificial” glut coincides with the rainy season (March — June), which was also the period the Nigerian government decided to impose the Covid-19 lockdown. During this period, crops such as maize and fruits tend to have higher marginal profit, and are therefore comparatively more attractive to local marketers, largely women who recycle a limited amount of capital for trading. This shrewd method ensures that instead of retailing eggs and turning usual profit, they migrate to a more profitable agricultural product, “sacrificing crates for baskets” until the rainy season is over. Another important thing to note is that while smallholders cry over the loss of capitals and organize mass burial of eggs, large commercial egg producers continue to make sales, and appear unaffected by the supposed glut so far.
In my view, there is need for extensive research into the causes of the glut, which should yield recommendations on what structures are needed to safeguard the investments of farmers. Such a study could also introduce an empirical methodology for tackling supply problems in future.
One possible solution to this crisis is the creation of a niche industry to process eggs into diverse products or forms. The shelf-life of eggs kept under room temperature is between 7 to 10 days. Frozen egg products have a long shelf life, while dried egg products can be stored for around one year.
Another approach is for smallholder farmers to enter into contractual arrangements with large commercial producers who can absorb their products and make use of their logistic architecture in selling their eggs. Small-scale producers can also benefit from joining forces to achieve economies of scale, and also give them a bigger voice in articulating their needs and interests. Such a coalition can also play an important role in linking producers and consumers through established, non-seasonal,retail chains, and hence breaking the glut cycle.
Written by Dorcas Abimbola Omole.
This article is part of Covid-19 Food/Future, an initiative under TMG ThinkTank for Sustainability’s SEWOH Lab project (https://www.tmg-thinktank.com/sewoh-lab). It aims at providing a unique and direct insight into the impacts of the Covid-19 pandemic on national and local food systems. Also follow @CovidFoodFuture, our Video Diaries From Nairobi, and @TMG_think on Twitter. Funding for this initiative is provided by BMZ, the German Federal Ministry for Economic Cooperation and Development.
