An Overview of the Nigerian Dairy Industry
Nigeria has a population of over 180 million residents consuming 1.3 billion tons of milk annually. This creates a huge market for locally produced milk and dairy products but unfortunately, about 60% of dairy products consumed in Nigeria are imported.
The consumption of dairy in Nigeria is rising faster than the pace of production and this has caused the wide gap in the dairy industry to be filled by the importation of dairy products.
The various activities of the Nigerian dairy industry (ie milk production, importation, processing, marketing, and consumption) have been ongoing for over 60 years.
These activities however have not been carried out in an organized manner except for few processing firms that produce and market reconstituted milk products from imported powder milk.
The gap that exists between supply and demand for dairy products continues to widen due to the continuous increase in population and urbanization.
Dairy Production in Nigeria
Nigeria has the 4th largest cattle production in Africa, estimated at 20 million cattle including 2.36 million cows used for dairy production (Sahel, 2019).
According to the UN Food and Agricultural Organization (FAO), 11.5% of the country’s total herd is used for dairy, while 88.5% is consumed as meat.
A greater percentage of the cattle found in Nigeria is found in the Northern region states of Kaduna and Kano, 90% of these cattle are local breeds, while the remaining are cultured breeds imported from the Netherlands and South Africa. It is those imported breeds that are usually used for dairy production in Nigeria.
Billions of dollars are spent on milk annually but domestic milk consumption levels continue to decline. The average annual per capita consumption of milk in Nigeria is between 10 and 20 litres compared to the US dietary guidelines 267 litres per year.
The low consumption of milk in Nigeria is influenced by the low purchasing power in Nigeria who still classifies milk and dairy products as non-essential luxuries and prioritizes other staple foods such as rice, yam, and beans.
Notwithstanding the low per capita consumption volume, the Nigerian dairy production system is still unable to meet current demand.
The inability to meet up with current demand stems from the fact that the Nigerian milk production system is mainly subsistence-oriented and tainted by low productivity.
According to H.J Makun (2018) “The average annual production per cow is 213 liters, which is less than one-tenth of the global average. Local milk producers, mostly women, are unorganized and are limited by gendered cultural norms and a lack of agency”
Another factor that contributes to the low production of dairy in Nigeria is the absence of a fodder production value chain which provides farmers with year-round access to quality feed for their cattle. The fodder production value will ultimately curtail the conflict that arises between Northern herders and southern landowners as a result of Northern herders migrating to the more arable southern Nigeria in search of grazing land and water for their cattle during the dry season.
Production Challenges in the Nigerian Dairy Industry
The local dairy production in Nigeria is plagued by various challenges like limited access to quality inputs, the poor genetic composition of the local breeds for dairy production, archaic production practices, and limited availability of Finance.
Limited Access to quality inputs: This is a major challenge facing the Nigerian Dairy sector and it includes limited access to water, quality feed/fodder, and veterinary services/vaccines/drugs.
The limited access to quality water and feed affects cows’ productivity and contributes to conflicts between herdsmen and crop farmers and lack of adequate access to veterinary services hamper cows’ productivity.
Poor Genetic Composition of Local Breeds: The unfavourable genetic composition of local breeds for milk production leads to low yields of 0.5–1.5 litres per cow per day (compared to 28 litres for cows in the USA)
Archaic Production Practices: Practices such as hand milking which is still widely practised in Nigeria affect the quality of dairy products and the farmer’s income potential.
Limited Availability to Finance: The limited access to credit and cost-effective financing hampers the ability of commercial farms to scale up their operations.
The Need For Development of the Nigerian Dairy Industry
Harnessing the potentials available in the Nigerian Dairy Sector will have multiple positive transformative effects on the Nigerian economy.
A thriving dairy industry will also empower local milk producers and will ease herdsmen-related communal conflict.
Self-sufficiency in dairy will also reduce the country’s import bill thereby reducing the pressure on the naira as demand for foreign currency drops.
Furthermore, jobs for skilled and unskilled labour will be created across the value chain.
Efforts should be put on ground into eliminating the challenges affecting production in the dairy sector.
The Aggregation, Processing, Distribution, and sales of dairy products is another important aspect of the Nigerian Dairy Industry that should be looked into.
Unfavourable milk imports that are cheaper to produce and import continue to hinder the growth of the Nigerian Dairy Industry.
The Central Bank of Nigeria (CBN) in a bid to encourage local production in the dairy industry in Nigeria imposed an import ban on the 11th of February, 2020. The import ban was imposed on milk and dairy products while exempting six companies from the restrictions.
The six companies exempted were:
- FrieslandCampina WAMCO Nigeria
- Chi Limited
- TG Arla Dairy Products Limited
- Promasidor Nigeria Limited
- Nestle Nigeria Plc
- Integrated Dairies Limited
As this is a step in the right direction, the government still needs to do more in not just creating these policies but ensuring that the policies are monitored and properly implemented. With that, the Nigerian Dairy Industry will be on its way to proper development in Nigeria.