Poultry Business in Nigeria: High Costs – Threat to Cost Effectiveness

One of the major threats to cost effectiveness of businesses in Nigeria is the erratic power supply to factories. Many factories run on electrical generators for much of the day. The price per liter of diesel is about N200.00. Running feed mills and hatcheries with high cost diesel could lead to the closure of mills and hatcheries thus impairing the value chain.

There is increasing costs of feed ingredients such as maize which is a major component in the feed formulation thus making the cost of production to be less cost effective for the millers. High costs of fuel and high cost of feed ingredients adversely affects the bottom line in terms of profitability.

An important element in the value chain is the day old chick production which is fundamental to the sustainability of the industry as this determines the availability of inputs on which other inputs depend. Tnerefore, there is an urgent need by the government to address these threats such as the power supply.

The average price of a day old broiler as at June 30, 2020 is N370.00, while a day old layer chick costs N280.00. A day old cockerel costs N70.00. A bag of starter feed mesh averagely costs N3800.00. A bag of Grower Feed Mesh costs N2950.00 while the Layer Feed Mesh costs N3200.00

A crate of eggs costs about N1000.00

John Ayodele.