Poultry businesses in Nigeria are at risk of losing significant investments over the scarcity of cash that was caused by the Central Bank of Nigeria’s (CBN) Naira redesign policy.
Since the deadline to phase out the old N200, N500 and N1,000 notes was effected in February 2023, the poultry businesses have been unable to sell 80 per cent of the eggs laid by about 76 million commercial layers (birds) in the first week of last month.
According to the Director-General, Poultry Association of Nigeria, Onallo Akpa, there are fears that the egg market could collapse as a result of continued Naira scarcity.
Recall Prime Business Africa had reported that the Supreme Court ordered that the old Naira notes remain legal till 31 December 2023.
This voided the 10 February 2023 deadline set by the central bank, however, despite the order of the Supreme Court, the Naira remains scarce in Nigeria, as the CBN is reportedly yet to release the old notes to banks.
Akpa said if the scarcity persists into the second quarter of this year, many poultry businesses will have to shut down because it makes no business sense for them to keep producing eggs if they can’t sell it, he told Punch in a report on Tuesday, 21 March 2023.
Akpa said: “what we are facing since February is that people have no access to cash. The wholesalers who buy at the farm-gate price are to retail these eggs to consumers or retailers.
“But the consumers have no money to buy the eggs; even when they have the money in their accounts, they don’t have cash to pay for it. This is because many of the poor masses don’t have the resources to buy a crate of eggs, which is 30 in the crate.
“People pick five eggs, fry it for immediate consumption, while those who make tea and other light foods on the road, buy like half crates or at times 10 eggs, and these are based on cash transactions.”
He added: “We have over 76 million commercial layers laying eggs on a daily basis. We also have breeders laying eggs on a daily basis. Now, if people have no cash, there’s no way they would buy day-old chicks and restock on their farms. This is because on daily basis you need money to buy feeds, medication and other important things.
“And if you don’t get money, how will you buy all these things to keep these birds? Also, you know that egg is perishable. You can’t keep eggs for a maximum of 14 days, and unfortunately, this is a hot period. So if you are unable to sell these eggs in one week, they’ll go bad.
“This is where the colossal amount of money involved in the unsold eggs and the damaged eggs come from. And if this continues in the next one month or before we get the new government, then every other poultry farmer will close shop.”