Farmers are facing increased cost pressures despite a bullish start in many of the producing states.
The sector is facing the challenge of increased cost of debts, following rising interest of between 24 and 28 per cent.
Farmers face higher debt-serving costs from rising interest rates, which will erode profit margins in the sector in an environment of higher input costs emanating from the massive upswing in fuel, fertiliser, pesticides, and herbicides experienced during the season.
Speaking with The Nation, President, Poultry Association of Nigeria(PAN), Ezekiel Ibrahim Mam, noted that rising interest rates have impact on input costs, resulting in increasing price of chicken meat.
According to him, producers have suffered intense input cost pressures, and this has been reflected in higher prices.
While inflation is affecting markets, Ibrahim warned that the prices of poultry products would have to rise, with feed and electricity costs on the increase.
He called for the protection of the industry, saying chicken meat is the cheapest animal protein. He noted that consumers are being priced out of even low-cost chicken.
Mam also called on the Federal Government, the Central Bank of Nigeria (CBN) and other financial operators to wade in and put framework in place to enable poultry farmers access loans at five per cent interest rate.
Vice Chairman, All Farmers Association of Nigeria (AFAN), Otunba Oke Babafemi, also said the upward movement in interest rates would impact on farming business with escalating input costs emanating from the massive upswing in fuel, fertiliser, pesticide, and herbicide.
According to him, the situation would put strain on the primary agricultural sector’s ability to grow.
He explained that with rising costs of input, food security is under threat as farmers are struggling to make ends meet with the rise in operational costs.
National President, National Cashew Association of Nigeria, Ojo Ajanaku said cashew has high potential of profitability but the major challenge is the access to funds for startups, expansion processing and export.
Nationwide, farmers are complaining that the rising interest rates is making it difficult for farmers to replace and replenish their machinery and equipment.
Following rising costs, retailers are passing cost increases to consumers.
Across industries, including agriculture, interest rates have significant impacts, affecting the cost of borrowing money, investment decisions and values of farmland.
Analysts observed that changes in interest rates affect profitability of the agricultural sector by influencing borrowing, spending and investing.