INDUSTRY PLAYERS CALL ON FG, CBN TO BAN IMPORTATION OF POWDERED EGGS
Ban will boost local contents, integration policies
The Federal Government, through the Central Bank of Nigeria (CBN), has been urged to ban the importation of egg powder or increase the tariff drastically to discourage dumping of the product on the country, stimulate home production of the powder and develop the poultry value chain.
They hinged their argument on the response of chicken and rice producers to the demand driven by the closure of the borders against rice importation and smuggling. Estimated quantity of rice produced locally has been put at over 8 million tonnes as against over four million before the policy implementation.
Also, the egg stakeholders said over $ billion expended on importation of egg powder by industrial food processors could be available data indicates that food processing industries in West Africa spend over $2 billion yearly on imports of egg and milk powder products, and Nigeria is said to spend $1billion on egg powder imports alone.
The price of whole egg powder in the international market is N1.1million per tonne.
In February 2018, Director, Corporate Communications at the CBN, Isaac Okorafor, disclosed in Abuja, explained that Greenfield Assets Limited, under the PPP arrangement, had commenced the utilisation of 150 hectares of land for the establishment of 10 million broilers per annum farm with a 4,000-bird-hourly meat processing plant; a 600,000 laying-bird farm for the production 100 million eggs per annum; two 20 tonnes per hour feed-mill and a 500,000-egg-per-day egg powder production facility, and that the facility would soon be inaugurated.
However, efforts to reverse the trend have been fruitless, as a facility for egg powder production in Ondo State has not been inaugurated for operations, leaving the country with a small-scale egg powder player in Ogun State as the only existing processor.
A former president of the Poultry Association of Nigeria (PAN), Mr Kabiru Ibrahim, Poultry Association of Nigeria (PAN) once said, “We need to start processing eggs into powder to help address the issue of egg glut in the country and also increase the shelf life of our eggs.”
However, Professor Funso Sonaiya, a poultry value chain development in the Department of Animal Science, Obafemi Awolowo University, Ile-Ife, said though he did not believe in a total ban of importation of egg powder into the country, tariffs could be raised to protect and encourage the local processors of eggs into powder.
Competition with international products, he said, would help Nigerian producers to standardize their products, urging more Nigerians, and particularly poultry investors, to see great opportunities in egg powder investment and processing.
Prof. Sonaiya also said utilisation and industrialisation of eggs into powder would create a ready market for egg producers, eradicate cycles of egg gluts and stimulate greater investments, job creation and poverty alleviation in the country.
Mr Banji Akanji, a former chairman of the Poultry Association of Nigeria (PAN), Oyo State chapter, said advocated a total ban on the importation of the product, saying, “my opinion is, let there be a total ban on importation of egg powder to the country. The government should ban its importation.”
He argued that egg production in Nigeria is enough for direct and industrial utilisation, assuring that in the next six months, poultry production would have increased because of new opportunities being cultivated.
“What happens to the production of rice will happen in the poultry sector. In less than six months after the closure of the borders, there is a turnaround in rice production. If the government can intervene in the egg sub-sector as they did in rice, there will be a drastic change,” Akanji explained.
“There are over 1,000 rice polishing machines coming into the country now. That could make Nigeria’s rice as polished as foreign rice,” he added, and “If the Federal Ministry of Agriculture works with its finance counterpart, poultry farmers and processors, and if the importation of egg powder is banned, I assure you it will be made available locally.”
John Olateru, a breeder and hatchery owner in Ibadan, said “All those conglomerates using powdered egg in Nigeria are mischievous. They have facilities to dry the eggs. Whenever they have a challenge with the quality of the imported powdered eggs, they do make use of fresh local eggs.
“They buy in trailer loads. There was a time did that. I can tell you, if the government imposes heavy tariffs on the importation of the product, they will patronize the locally produced eggs.
“They have been looking for one technical excuse or the other to justify the importation of the product.
“In the organograms of most of the conglomerates, the Managing Directors in Nigeria are under some people in Europe or America. They call them Managers, Nigeria.
“They report to Assistant General Managers in Europe. And what they are doing is to use the importation to siphon foreign exchange. Most of the powdered egg is from The Netherlands. They are the owners of producing subsidiaries and they determine whatever price to sell to the Nigerian subsidiary to siphon foreign exchange.
“What they do is exporting our resources to their own country. It is a complicated politico-economic policy. So, let the government place a ban on importation of powdered eggs and you will see that the poultry industry in Nigeria will strive. You never see egg glut in this country again, and more people will go into the production of eggs. People are already running away from the industry because there is no certainty, and are challenges in the industry.
“But if the poultry industry flourishes in Nigeria, there is a lot of value chain players that will benefit. The mass employment that will follow will be unbelievable,” he said.
Mr Samuel Olusegun Shewoniku, Director of Operations, Answer Industry, an egg powder processor in Ijebu-Ode, Ogun State, said one of the challenges is inadequate knowledge of the product by Nigerians.
“Most people don’t know about it. Currently, we can process about 50,000 eggs in a day and that is close to one tonne per day, depending on the size of the eggs. Though we have been trying to expand, we must have a market for it,” he said, calling on the government for policies that would boost home production.
He argued that consumption of powdered eggs “won’t just have positive but multiplier effects on local production. If we have demand, we would order for eggs. And if you are our customer producing 50 creates of eggs, and we are buying all the creates and still not enough for us, you would be forced to increase your capacity knowing that you have a ready market. You will also employ more hands. That is why I said it would have multiplier effects.”
He said the government could partially restrict importation, but not at once, saying, “Out of egg powder they are using, the government can make them to give local suppliers about 20 to 30 per cent local contents.
“Once we know that we have that, we can increase our capacity to start supplying maybe 60 to 70 tonnes. The truth is that, the bigger your capacity, the lower your cost of production,” he said.
On the source of quality eggs for production, he said, “We have some selected people who supply based on specifications.”
Farmers from Oyo State and Kwara states, he disclosed, always want to supply eggs to the factory, “but we told them that we have to be sure of the feeds they use. Once we are sure of the feeds that they do not include antibiotics, we would buy.
He also added that the factory does not buy eggs of older laying birds but mostly the ones that are not more than a year old.
“We do not also use eggs that are more than three or four days because of the nutritional depreciation,” he said, placing emphasis on the quality of eggs for egg powder production for international standards.
The Vice President of the Chamber of Commerce and Industry, Ijebu-Ode, and chairman of the company, Mr Samuel Shewoniku, while explaining what the government could do to salvage the industry, said “the government do not have business in running businesses, but to improve policies that can enhance any productive venture. Let the government help us to create awareness to stop or reduce importing this product into this country.”
He was of the view that “if they are desirous of promoting local industries such as ours, they should increase tariff on importation. Those multinationals engage their people outside this country in producing raw eggs for egg powder production. We are being used to oil their economies while our farmers are suffering here and closing down their farms. We are creating jobs for them over there, but we are losing jobs here. So, if the government increases tariffs, they will look inward,” he said.