High financing costs force underproduction in Nigeria’s poultry sector – Rhyss Farms CEO
The CEO of Rhyss Farms, Olajide Basorun, has said high financing costs are driving underproduction in Nigeria’s poultry sector, as farmers are unable to fully utilise existing capacity despite sustained demand.
The CEO of Rhyss Farms, Olajide Basorun, has said high financing costs are driving underproduction in Nigeria’s poultry sector, as farmers are unable to fully utilise existing capacity despite sustained demand.
Basorun disclosed this in an exclusive chat with Nairametrics, where he said credit constraints, infrastructure gaps, and rising input costs are limiting expansion and efficient operations.
He added that the widening gap between borrowing costs and profit margins is making it difficult for producers to optimise output levels.
Basorun, whose farm is in Erikorodo Farm Estate, Lagos, said high financing costs are driving underproduction in Nigeria’s poultry sector, as farmers struggle to fully utilise existing capacity despite steady demand.
He said rising input costs and high interest rates are eroding already thin margins, forcing many farmers to scale down production instead of expanding capacity.
Using his farm as an example, Basorun said egg production has fallen from an installed capacity of about 1,500 crates daily to 700–800 crates currently, while broiler output has dropped from an installed capacity of 10,000 birds per cycle to about 4,000.
He stressed that this reflects funding and cost pressures rather than weak demand, adding that cheaper financing would help restore full capacity and boost sector output. He noted that underutilisation is now widespread due to working capital shortages.
Beyond financing, Basorun pointed to weak technical knowledge among new entrants, noting that many join the sector without an adequate understanding of feeding cycles, nutrition, and farm management, leading to inefficiencies and higher production risks.
He added that high energy costs, driven by reliance on diesel for storage and processing, further raise production expenses.
Poultry farmers in Nigeria had earlier raised concerns over the proposed $900 million Federal Government–China partnership, warning it could undermine local producers if poorly structured.
Nairametrics had earlier reported that poultry farmers lost over N3 trillion in 2023, while the Poultry Association of Nigeria said more than 50% of farms shut down within the same period.
