The Aquaculture Postharvest Value Chain in Nigeria

by Julius Nukpezah, Joseph Steensma, and Nhuong Tran

Malnutrition is a major problem in Nigeria. Nutrition-related health challenges, such as obesity, among adults and children is rising because of a shift in the consumption pattern away from healthy diets. Fish has the potential of addressing the malnutrition challenge in the country. However, the fish sector contributes only 4% to the country’s annual gross domestic product, although it is an important component of the national animal-protein supply.

While the global average for fish consumption is 21 kg per capita per year, that of Nigeria is about 12 kg per capita per year. Nigeria not only lags the world in fish consumption but also production, largely because fish and aquatic food production is not fully realized. Addressing the production challenge would also address the social and economic challenges of Africa’s largest economy and a country of more than 200 million people.

Despite the potential that aquaculture and fisheries hold, imports contribute more than half of the fish consumed in Nigeria. For Nigeria to address its sustainable development challenges and reduce the loss of foreign exchange, interventions are needed. The government of Nigeria has selected aquaculture as one of the priority food value chains for expansion and development because of its potential to generate employment and income for a significant number of fishers, fish farmers, and fish traders.

Preliminary studies on the aquaculture sector in Nigeria found that a strong market demand exists for fish and that opportunities for increasing fish supply from aquaculture is plausible. However, a paucity of good data and analysis on many aspects of fish within the food systems in Nigeria are lacking in areas such as fish production and productivity, inputs and services, processing, marketing, consumption, gender, and policy. Addressing the gaps in knowledge will provide both the public and private sectors with investment guidance and opportunities and policy direction for increasing the contribution of aquaculture to economic development in Nigeria.

To support Nigeria’s aquaculture development, the Feed the Future Innovation Lab for Fish (Fish Innovation Lab) awarded the Quick Start project entitled “From Harvest to Plate: An Analysis of the Aquaculture Post-harvest Chain in Nigeria.” The project aimed to understand the contribution of aquaculture to improving livelihoods in Nigeria.

 The project enhanced understanding of the following:

• Postharvest aquaculture value chain
• Postharvest losses along aquaculture value chains
• Characteristics of aquaculture production systems in Nigeria
• Aquaculture contributions to rural livelihoods and household incomes
• Role of women in aquaculture
• The way forward for the aquaculture postharvest sector in Nigeria

The remainder of this blog is a summary of the major findings from this research project.

Postharvest Aquaculture Value Chain

Value chain is a set of activities that connect a product from production to consumption. Aquaculture value chain activities include producing, processing, wholesaling, retailing, and consuming.

Analyses of postharvest aquaculture value chains in Nigeria reveal that these are short and simple, though there were variations in value-chain configuration and coordination among eight states that were studied.

States with higher aquaculture concentration, such as Lagos, Ogun, Delta, and Rivers, have higher levels of value-chain complexity than those with small aquaculture production.

Value-chain actors across all states have limited cold-storage facilities. To address this challenge, fish purchased from producers are sold as fresh or smoked and dried to preserve their quality as they travel along the value chain.

Value-chain actors at the postharvest stage keep products for a short duration. Fish products are marketed and sold in different forms, including live fish, fresh fish, and smoked fish because of the poor infrastructure for transportation and limited electricity supply.

Postharvest Losses Along Aquaculture Value Chains

In Nigeria, where access to electricity and cold chain can be an issue, fish losses can be significant. Post-harvest losses can be due to

• mishandling of products,
• contamination during transportation,
• poor storage facilities
• inadequate processing technologies
• longer time on the way to markets waiting to be sold.

The analysis of the sample in this study showed that the total fish losses overall were surprisingly low (less than 2%) in Nigeria.

• Fish losses from small-scale aquaculture is slightly higher than large-scale aquaculture for both catfish and tilapia.
• Losses for catfish were lower than tilapia mainly because catfish has higher tolerance to space and water quality during transportation and can be sold live in the market.

Characteristics of Aquaculture Production Systems in Nigeria

Aquaculture production systems in Nigeria that are operated by small holders are characterized by small production facilities. It is common for aquaculture farmers to use multiple of these systems. The most common aquaculture systems used by small-holder aquaculture farmers are

• Earthen ponds (58%)
• Concrete tanks (38%)
• Fiber-plastic tanks (12%)
• Tarpaulin tanks (15%)
• Collapsible ponds
• Cage aquaculture
• Flow-through raceway
• Recirculating aquaculture system
• Burrow pit

For assessing economic performance of aquaculture production, we conducted the following analyses:

• Benefit-cost analysis of catfish aquaculture practiced by small aquaculture farmers in Nigeria in major aquaculture production systems, namely earthen ponds, concrete tanks, and other production facilities
  • The results of this analysis suggest earthen ponds have higher profitability (1.75—N1.75 earned for each N1.00 invested) followed by concrete (1.62) and others (1.56).
  • On average, for each dollar of investment, farmers get back 0.64 dollars gross margin. This is 0.75 for earthen pond, 0.62 for concrete, and 0.56 for other production systems in use.
  • Due to low operation costs, earthen ponds had the highest benefit-cost ratio compared to concrete tanks and other production facilities.
• Benefit-cost analysis of tilapia aquaculture practiced by small aquaculture farmers in Nigeria report poor performance.
  • Benefit-cost ratio averages 1.17 for the whole sample.
  • The benefit-cost ratio for earthen ponds is 1.09.
  • Other production facilities experienced a negative net return and resulted in a benefit-cost ratio of 0.55.

There are important implications for tilapia aquaculture assessment:

• Tilapia is presently not a popular aquaculture species farmed in Nigeria. Therefore, only 19 of 648 surveyed farmers reported farming tilapia in 2018.
• Tilapia is included as a species in polyculture with catfish, and the production objective is likely to provide feed to catfish. In other words, aquaculture farmers in the surveyed sample may not pay equal attention to tilapia as catfish.

Aquaculture contributions to rural livelihoods and household incomes:

• Aquaculture production is addressing the high demand for fish in Nigeria even though gaps remain.
• The success and profitability that other farmers report is an important factor influencing farmers’ decisions to start aquaculture operations.
• Aquaculture is a profitable activity that contributes to household income.
• For more than 75% of farmers surveyed, aquaculture contributes more than a half of their household’s income.
• Farmers engage in other businesses, such as agriculture production (mainly crop farming) and trading.
• Only 25% of respondents focus on aquaculture as the only livelihood/income generating activity.

Role of Women in Aquaculture

The prospect of aquaculture development in Nigeria is promising. Women are involved in aquaculture production in Nigeria. Key informant interviews and focus group discussions indicate gendered roles in aquaculture value chains in Nigeria. For example, men are more likely to participate in aquaculture production and processing activities while women are more active in trading, wholesaling, and retailing activities.

The top challenges that preclude women’s involvement in aquaculture are

• Cultural restrictions
• Lack of capital and difficulty for women accessing financial resources
• Low risk-taking attitude of women
• Poor infrastructure limiting women’s participation in aquaculture activities
• Lack of technical knowledge that constrains women’s engagement in aquaculture-related livelihood activities

The Way Forward for the Aquaculture Postharvest Sector in Nigeria

The prospect for aquaculture development in Nigeria is promising. While unknowns remain, we have come to understand that

• The overall efficiency of the aquaculture sector is not profoundly impacted by postharvest losses.
• Potential opportunities exist for greater investment in training and technical skill development among women and youth to improve the postharvest value chain in the Nigerian aquaculture production system.
• Overall, growth in demand and increasing competition should continue to drive efficiency within the value chain, postharvest included.
• Because aquaculture production is concentrated in the south, development interventions might consider starting in the south with successes in technology being replicated to other parts of the country.

Although different aquaculture technologies may have their merits and demerits, specific technologies may be more appropriate for the respective states. Therefore, instead of transferring knowledge simply based on return on investments, efforts at understanding the cultural drivers of the preferences for specific technologies is important.

Julius Nukpezah is an assistant professor of public policy and administration at Mississippi State University. Joseph Steensma is a professor of practice at Washington University in St. Louis. Nhuong Tran is a scientist at WorldFish. All were investigators on a Fish Innovation Lab project analyzing postharvest fish value chain in Nigeria.