According to Research, Poultry farming in Africa is one of the biggest business opportunities on the continent.
Africa’s love for poultry meat and eggs has grown at a staggering pace. Every year, the continent imports more than two million metric tons of poultry products valued at nearly US$3 billion to meet domestic demand.
In 2012 alone, more than five million tons of poultry meat and two million tons of eggs were consumed in Africa. Africa’s love for chicken and eggs is increasing with the size of its rapidly growing population.
Let’s explore the amazing opportunities for African entrepreneurs in this large and potentially lucrative market for chicken and eggs…
Africa’s appetite for poultry products is huge and still growing…
Chicken and eggs are a rich source of animal protein for millions of Africans. The young population, who make up more than 70 percent of the continent’s people are the highest consumers of poultry products.
Africa’s poultry market is experiencing a boom as a result of its rapid population and economic growth.
Brazil and China have become the largest exporters of frozen chicken to our markets and have made it nearly impossible for local poultry farms to thrive. (photo credit: guardian.co.uk)
Many African countries understand the huge income potentials for local poultry production and have placed import bans on poultry products to protect local producers.
However, most of these bans have not been effective and have made no real impact on actual foreign imports. Smuggling poultry products, especially meat, have become very big business in countries like Ghana, Nigeria and Uganda.
For example, in the year 2010, over 200,000 tons of frozen chicken were exported to Ghana from the US, EU and Brazil.
In Nigeria for instance, up to 100,000 tons of imported poultry products (including chicken and eggs) are seized annually over its borders and destroyed. This has severely undercut the profit potentials of this lucrative market for local producers as they struggle to compete with very cheap foreign imports.
It is almost impossible for African producers to compete with these very cheap imports.
Brazil is the world leader in poultry exports (including chicken and eggs) and has one of the lowest production costs in the world which makes its exports extremely cheap.
Even South Africa, Africa’s former largest economy, is under pressure to save jobs in its local poultry industry due to the influx of cheap Brazilian and Chinese chicken.
Combined with the US and Europe, who are also jostling for a larger share of the African poultry market, it has become increasingly difficult for African entrepreneurs to exploit the poultry consumption goldmine.
Market Opportunities for Poultry farming in Africa
Since cheap imports from Brazil, USA and Europe have cornered the African poultry market, are there still any lucrative opportunities for local entrepreneurs?
There appears to be a glimmer of hope! Of the two major poultry products (meat and eggs), egg production holds a lot of promise for African entrepreneurs. While it may be relatively easy to smuggle poultry meat, eggs are much more delicate and have a sensitive shelf life.
Poultry meat production may still have opportunities for local African entrepreneurs. However given the stiff competition from cheap imports, this is likely to be a very risky business venture unless you have a guaranteed niche market or exclusive supply contracts.
Egg production holds a lot of opportunities and less competition from foreign imports.
Did you know that Africa’s population makes up more than 15 percent of the world’s population but contributes less than 5% of global egg production. The upside is also quite promising.
On the average every year, only 2.2kg of eggs are eaten per person in Africa. This is much below the world average of 8.5kg per person per year. There is indeed a lot of egg eating to be done in Africa, and a lot of production too!
As our population increases, and the size and earning power of the African middle class grow, the demand for poultry products is bound to put a lot of pressure on the already limited production.
Households, restaurants, processed food producers, fast food businesses, bakeries and confectioners constitute a large chunk of annual egg demand and make very good potential targets for a small scale egg supplier.
Pullets (young female chickens) mature and start laying eggs when they reach 20 – 24 weeks (5 to 6 months). Egg production is likely to reduce by nearly 50 percent when these layers reach 18 to 24 months of age.
A single layer of the right breed can produce up to 300 – 450 eggs in her productive lifetime if the proper management, feeding and disease prevention practices are undertaken.
With these production figures in mind, a well-positioned producer can target a domestic market (small retailers, kiosk operators, housewives etc.) and become the neighborhood egg supplier of choice. Since most families have eggs in their diet nowadays, it makes a lot of sense that you exploit your neighborhood market!
As long as your prices remain competitive and the quality of your eggs and sales service is excellent, your customer base should start to expand and you may have to increase the capacity of your farm to meet the increasing demand of your market.
Some things you should consider before you start a poultry business…
Since the scourge of avian (bird) flu, countries and people have become alert to the possible effects of breeding poultry close to humans and where we live. You may need to consider the environmental effects of your poultry farm on your health and neighbor-hood before you start.
If the recommended vaccination and hygiene practices are strictly enforced and followed, you are unlikely to run into any problems with the neighbors or sanitation/health authorities.
However, we must warn you; poultry excrement (shit) can be very offensive! Make sure you take proper care to fight the offensive odor if you intend to farm your birds close to residential areas.
Another important thing to note before you start your poultry business (chicken and eggs) is the prevailing price of commercial feed in the market. If you are considering buying commercial poultry feed, it may be wise to confirm that the price of eggs (or meat) is higher than the price of commercial feed.
If it will cost you more to feed the birds than the price you will ask people to pay for their meat and eggs, it surely doesn’t make any sense.
However, there are very good local feed substitutes that can be used to provide good egg yields from your birds. It is important that you understand the nutritional requirements of your birds for the purpose that you will be breeding them (eggs or meat). More important is the selection of the right breed of layers (for eggs) and broilers (for meat).
Good poultry breeds can convert more feed to body weight (for broilers) and eggs (for layers). The ability to convert more feed may mean the difference between profit and loss in this business. You must ensure that you source your chicks from very credible and well-referenced hatcheries before you start.
If you have any experience in this area, we’re sure a lot of people reading this would love to learn from you. Please leave a comment in the section below or share this opportunity with a friend.