The Nigerian Dairy Sector carries huge money-making potentials. There are numerous lucrative investment opportunities within the dairy value chain that discerning investors should tap into for optimal returns. These opportunities lie within the broad areas of milk production, aggregation, storage, processing and marketing.
However, within the value chain, there exist many pain-points which have contributed to the low performance of the sector when appraised in line with its potential.
There are significant challenges at the milk production level. The productivity of local cow breeds managed by pastoralists is low at 0.5 to 1.5 litres of milk per day, compared to a global average of 6.6 litres per day by cows managed by pastoralists. The output from Nigeria’s managed pastures – an average of 8 litres per day is also a far cry from the global average of 30 litres per day.
These are according to a recent (2019) report on the dairy sector published by PriceWaterhouseCoopers (PwC). Lactating cows are also poorly fed by smallholder dairy farmers. These pastoralists traverse the country in search of available forage and water sources and pay little or no attention to the nutritional content and suitability of the feed and water their cows consume. Poor nutrition translates to low milk quality and quantity, leading to low income.
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Other challenges within the milk production space are poor animal disease management; with foot-mouth disease ravaging cattle populations, and pastoralists lacking access to proper veterinary services for their cattle.
There is also the low adoption of technology in production as the pastoralists stick to outdated animal husbandry practices and do not possess the financial capacity required to adopt new technology.
The Midstream – Nigerian Dairy Sector’s Weakest Link
The most crippling challenges in the dairy sector are found in the midstream sub-sector of the dairy value chain. This, in practical term refers to all the activities that take place after the milk is extracted from the cow to when it gets to the processing facility or the open market. These activities include milk collection, aggregation, storage and transportation. The level of public and private investment in this important part of
the dairy value chain is low.
To state the obvious, even if the capacity of the upstream (production) sub-sector is enhanced and increased, the inefficiencies of the midstream would still cause wastages and keep Nigeria largely dependent on imported milk.
Lack of organised milk collection schemes, high cost of milk collection and cold chain facilities, poor transportation infrastructure, unstable or non-existent electricity supply, pervasive insecurity, and low access to finance are some of the challenges that affect smooth operations in the midstream aspect of the dairy sector.
The processing and marketing aspect (downstream) of the dairy value chain also faces the threats of low investments, poor access to finance and a weak regulatory environment.
How to Address these Pain-Points – The World Milk Day Conference – June 1, 2021
The Commercial Dairy Ranchers Association of Nigeria (CODARAN) is organising a conference scheduled for Tuesday, June 1, 2021. Globally, June 1 is marked as World Milk Day every year since 2001 to raise awareness on the nutritional value of milk and to celebrate the contributions of the dairy sector to sustainability, economic development, livelihoods, and nutrition.
The theme of the 2021 Conference is: “Strengthening the Local Dairy Sector in Nigeria: Addressing the Pain-Points for Sustainable Impact.” Distinguished experts, practitioners, government officials and other stakeholders in the Nigerian dairy sector will gather at the NAF Conference Centre and Suites, Kado District, Abuja, and make recommendations on how to address the pain-points that currently stifle the growth and development of the dairy sector.
Investors and interested players in the dairy value chain can take advantage of the wealth of knowledge that this conference will serve to understand what needs to be done to make the sector more profitable in a sustainable
way. Attendance at the conference is free, but registration is required. Online registration is now open at: codaran.org/wmd.
Please contact Dianabasi Akpainyang on [email protected] for information and inquiries.
