This is the 20th post on this informative poultry blog set up to educate Nigerians about the potentials in chicken farming.If you are here for the first time, please digest all the posts above and below to learn all the important facts that will make a big difference when you set up your chicken farm.
On this blog, starters will learn much about:
1) Setting up a layers chicken farm
2) Setting up a broilers chicken farm
3) Costing Analysis for set up of a chicken farm
4) Feed cost analysis
5) Feed Mix analysis
6) Chicken medication and disease control
7) Errors to avoid in the business
8) Important factors to note to do well in it
9) The nature of the market for poultry products
10) Many other details, if you can patiently read through all the posts below.
I wish to discuss the nature of the market for chicken products by comparing it with the market for catfish which Nigerians are highly interested in too but which has burned the hands of many,badly.
For poultry products such as eggs, the market in Nigeria is ready made, large and guaranteed.The demand for eggs is always above the supply and there is always room for a new entrant coming into the layers chicken farming business either at any level of start up.
Many Nigerians are in the poverty index and to them, catfish is a luxury.There are close and cheaper substitutes for catfish.A kilo of table size catfish costs N600.00 which a family of five will consume in one day. Many average or low income families prefer to buy frozen fish( eg Kote, Shawa, Croaker etc) which are far cheaper and last longer in their soup pot than catfish.
A kilo of Kote frozen fish is N400.00 and a kilo of Shawa frozen fish is N300.00 in Lagos. N600 worth of Kote frozen fish or Shawa frozen fish will serve a family of five for 2-3 days. A kilo of frozen(smuggled) chicken is N600.00 and can last up to 3 days too for an average family of five persons.
It is an undeniable fact that many average income Nigerian families prefer to buy a crate of eggs containing 30 eggs for N700.00 that takes 2 weeks to consume, than to buy a kilo of catfish for N600.00 that takes just one day.
You can see why this class of Nigerians who are in the majority cannot be interested in catfish for financial reasons.This means that a large segment of the population have been cut off, or have cut themselves off, from the market for catfish.
The majority of the fish farmers in Nigeria are small operators who stock few hundreds to few thousand fish in backyard concrete ponds.Many of them are totally ignorant of where the markets for fish are and the only market they know is the local market where they all go to look for buyers.The result is too many producers,too much fish, too few buyers and an obviously saturated local fish market.
The fish mongers who are the main buyers in the local markets exploit these farmers.Many of them are not catfish farmers, therefore may not know what it takes to rear a fish. They buy for resale and know the nature of the market and offer prices that may be lower than the farmer’s production costs because of the saturation.
The farmer may be desperate to sell in order to avoid increasing costs of production which will arise when he continues to feed matured fish that cannot be sold quickly. If he cuts corners to save cost by reducing the feed, the fish will depreciate in size. This is where the frustration starts.
Either way, this small operator is likely to make a loss or a profit margin too low.The fish mongers take advantage of the hapless farmers who do not know of any alternative market, by dictating the selling price to the farmer.
There are some large scale fish producers and large scale fish buyers as well who they know where their market is, but which the small backyard operators have no access to because they do not have the financial muscle.Egg is widely consumed by all categories of people irrespective of income levels. It is a highly sought after commodity in Nigeria.
Also, chicken for meat is widely consumed in Nigeria, vastly more than catfish. Visit frozen stores in any locale and ask for their rate of turnover in the sales of frozen chicken and frozen fish. Therefore,it can reasonably be inferred that the market for chicken products is far better than for catfish.The fact that frozen chicken is massively smuggled into Nigeria is an indication that there is a wide gap in the market to be filled.The Chicken business is the better preferred option in today’s Nigeria.No doubts about it!
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