Nigeria’s dairy industry is developing and within its value chain lies huge potentials for maximum investment returns.
As with any growing system, process or entity, Nigeria’s dairy industry offers both risks and returns. Some of such risks stem from individual business decisions and actions gone wrong; but some are borne out of systemic and environmental issues which can stand in the way of the best and smartest business decisions.
Smart business managers understand and appreciate the place of reliable data in making informed business decisions. According to a recent study highlighted by Harvard Business School, companies worldwide use data to boost process and cost efficiency, drive strategy and change as well as improve financial performance.
As stated by Harvard Business School Professor Jan Hammond, “if you’re able to go into a meeting, and other people have opinions, but you have data to support your arguments and your recommendations, you are going to be influential.” Moreso, if the popular aphorism that “numbers don’t lie” is anything to go by, then we realize straightway why the business manager with supporting data would be truly influential.
Absence of Critical Data in Nigeria’s Dairy Sector
Nigeria’s dairy sector suffers an alarming dearth of reliable data. Business managers, investors, regulators, development partners and other stakeholders virtually grope in the dark when current state of the sector data are required for decision-making. For instance, up till February 2021, there were no easily accessible data on the monthly volumes and value of imported milk into Nigeria, and no aggregated data to track annual milk import figures. The Central Bank of Nigeria (CBN) has just information on dairy imports done by companies which purchase foreign exchange through the official window. Not all importers of milk and dairy products source foreign exchange from CBN. The countries of origin of Nigeria’s milk imports and top milk importers have also not been available. The Commercial Dairy Ranchers Association of Nigeria (CODARAN), working with the Nigeria Customs Service has now bridged that gap and provides these crucial data to stakeholders on quarterly basis.
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Additionally, some available information on the industry may be stale and require regular updates. There is the widely cited information that Nigeria’s cattle population stands at about 20 million heads of cattle. This figure was birthed by the National Agricultural Sample Survey of 2011 which estimated Nigeria’s cattle population at 19.5 million, as announced by the former Minister of Agriculture and Rural Development, Mr Audu Ogbeh in 2016. Being a country of meat lovers and staunch consumers; it is to be expected that thousands of cows go under the butchers’ knives each day all across the country. Some cattle die of diseases, some are victims of perennial animosity between their caretakers and farming communities, and as we see in pictures on the internet, some cows are periodically struck dead by thunder!
In the same vein, all across the country on daily basis, pregnant cows deliver new calves in pastoral cattle populations and in managed pastures. There is the imported bit that may usually go unnoticed, both formal and informal imports. With Nigeria’s borders being what it is, the number of straying cattle and their custodians from neighbouring countries might just be mind-boggling. A system of tracking and updating these data should be set up.
The Need for Urgent Investment in Data Collection and Management for Nigeria’s Dairy Industry
Reliable data is critical to sound decision making. Data provide decision-makers with patterns and trends which may give rise to objective decisions. As earlier noted, availability of accurate data can be the difference between course-correction or continuation with a failing strategy. As underlined by the Food and Agriculture Organisation (FAO), reliable information is not only necessary for business managers, but is the foundation of sound management and should be the basis upon which government policies are formulated and development priorities are established.
Government interventions and those of development agencies may end up as “White Elephant” projects if they are not directed at areas of need. Also, government policies would be futile if there are no parameters to measure effectiveness and to track progress. To achieve these, reliable data have to be collated and accessible.
Furthermore, the Nigerian dairy industry is struggling under the burden of numerous challenges. It yearns for transformative actions to make it globally competitive. The drive towards self-sufficiency in milk and dairy products cannot progress at the required pace if stakeholders continue to make decisions “blindly” by relying on stale data or no data at all. Granted that some research institutions in the country and development agencies have conducted studies and surveys which have yielded some data on the industry that can be relied upon, there is still the pressing need to harmonize and consolidate available data for easy accessibility and retrieval.
Moreover, new foreign and local investors in the sector should have state-of-the-industry information to guide their investment decisions. Where up-to-date data are available, investors can better target their funds into areas where they project to have the highest opportunities, based on trends of performance.
The Opportunity
An opportunity lays in the industry for government, development agencies, industry groups, research institutions and corporate organisations to make targeted investments to enrich the quality of activities and make the industry more productive. For Australia, one of the advanced countries in dairy enterprise, the Dairy Australia platform provides information and statistics on the status of the market and provides direction for stakeholders. The Economic Research Service of the United States Department of Agriculture (USDA) – Dairy Data segment provides up-to-date information on demand, supply and trade of dairy products in the United States of America. There is the opportunity to replicate such data platform in Nigeria and the time to convert that opportunity to reality for the steady growth and development of the dairy industry is now.
