How to make poultry farming Kenya's new cash cow
The poultry sub-sector has the potential to transform Kenya’s economy and improve the well-being of Kenyans. While agriculture contributes 26 percent of the GDP directly and 27 percent indirectly in Kenya, 30 percent of this comes from the poultry sub-sector. This is a big contribution to Kenya’s GDP.
The market for chicken and eggs is huge locally. In one particular community, no special occasion or festivity is complete without a delicious serving of chicken stew. The best for this kind of occasions is always mostly indigenous chicken.
In fast-food restaurants that dot Kenya’s major towns and cities, chicken and chips are the favourite menu item, especially among the youth. The health risks associated with red meat and the religious restriction on pork has made chicken the most preferred source of protein. With rising cases of cancer and other lifestyle diseases, indigenous foods are getting back in vogue among Kenyans. However, the niche for indigenous chicken and improved indigenous chicken remains largely unexplored.
Currently, 80 percent of the poultry production in Kenya is based on the less productive kienyeji breed. The high cost of feeds, inadequate production information, unstructured markets for indigenous chicken, medication and low poor return on investment are a serious impediment to the sustained growth in this sub-sector. As a result, the majority of risk-averse farmers are relegated to low-production free-range systems.
A recent study commissioned by Baib Oy, an international Agri-tech company based in Finland interrogated pricing dynamics of feed raw materials based on available local price data with comparison to historical global data. According to the study, forecast models predict an increasing trend in the price of maize, a key poultry feed raw material, in the short-term. The Baib OY study could inform disruption of the $1.4 trillion global agriculture industry through optimisation of technology and technology solutions across Africa and emerging markets.
There will, however, be declines or fluctuations for other key raw materials like wheat and finger millet. Apparently, energy prices and exchange rates do not have a bearing on these feed materials. The study also established that there is no confluence between Kenyan pricing movements and global price fluctuations for maize and wheat grains. This is plausible as a big chunk of the maize and wheat in the Kenyan market is locally sourced.
Nevertheless, there is a paucity of historical data on prices of other key commodities such as soybean, cotton, and rice as well as premixes, soya cake, cotton cake, sunflower cake, rice polish, fish meal, bone meal and others. This is compounded by a lack of capacity in high-quality record-keeping across different institutions and actors within the poultry sub-sector. The prevailing information asymmetries are adversely affecting the ability of the smallholder poultry farmer to compete well locally, regionally and internationally. This calls for an urgent revamp of poultry information systems and repositories.
To achieve the Big Four agenda on food security, the Government should take advantage of opportunities available in the indigenous poultry industry by tackling the bottlenecks to the growth of the sector, which includes the high prices of feed, unstructured chicken and chicken products markets, lack of value addition, long-maturity duration of indigenous breeds and information asymmetry among smallholder farmers.
Steps should, therefore, be taken to create platforms in a participatory manner that can complement the National Farmers Information Service (NAFIS) website to improve knowledge sharing and information access in the poultry sub-sector.
It is imperative that Government agencies and other pertinent actors be sensitised on the importance of collecting livestock/poultry-related data at sufficient frequency (daily, monthly or even quarterly) to facilitate accurate forecasting. There is also a need to improve the capacity to collect this data by enhancing greater collaboration between various players in the poultry value chain, including private companies.
With improved technology and wider focus on optimisation of indigenous poultry breed production, kienyeji chicken farmers will shorten production cycles and enjoy quick returns. This is possible if focus is turned to the analysis of marketing channels for feed raw materials and structuring indigenous chicken and chicken product markets, which will eventually ensure cheaper feeds, shorter production period, shorter supply chain and a guaranteed market.
Like in the case of tea and coffee, emphasis should be put on the production of crops that provide raw materials to poultry feed. Cotton, fish, wheat, maize, to mention a few, should be given attention. In addition, a duty exception on imported premix will go a long way in reducing the prices of poultry feed in the short run. However, a more sustainable strategy will be to invest in research and development that would lead to the production of premixes, binders and enzymes locally.
Even as Baib OY works closely with the University of Nairobi to transform the local kienyeji poultry farming value chain with sophisticated optimisation tools, the State and other stakeholders need to do more to ensure farmers not only access cheap feeds but also know the best indigenous breeds and feeds. This way farmers will have the best chicken products for the structured market. In the entire value chain, farmers will also maximise their profits and achieve economic growth.
Dr. Nyang’anga is a lecturer at the University of Nairobi’s Faculty of Agriculture, Department of Agricultural Economics.