DRAFT

ACTION PLAN FOR AQUACULTURE VALUE-CHAIN DEVELOPMENT

FOR NIGERIA

TABLE OF CONTENTS

Page No.

1. EXECUTIVE SUMMARY …………………………………………………... 3

2. PROGRAM PROFILE..……………………………… ……………………... 4

3. INTRODUCTION……………………………………………………..…….. 5

4. AQUACULTURE VALUE CHAINS………..…………………………… 12

5. VISION OF SUCCESS AND OBJECTIVES ………………..……………… 13

6. TRANSFORMATION STRATEGY…………………………………………. 20

7. EXPECTED IMPACT………………………………………………………… 36

8. DATA MANAGEMENT……………………………………………………… 36

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LOG FRAME ……………………………………………...…………………..

TIME-LINE……………………………………………………………………

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11. BUDGET …………………………………………………...…………………. 60

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Executive SummaryTotal local fish production currently stands at an estimated 600,000 metric tones per annum while importation is estimated at over 700,000 metric tones. However, projected demand for fish in the country stands at about 2.6million metric tones, which therefore suggests an actual shortfall of 1.3million metric tones.

It has been noted that Nigeria can be fully self-sufficient in fish production, while local capacity can potentially turn the country from being a net importer of fish and fish products to a net exporter. In order to effect this reversal, the Aquaculture Value Chain Group has focused attention on (intensive) aquaculture as the best mode of production to bridge the wide chasm between latent demand and local production. While open water fishing activities continue to supplement fish supplies in the country, global trends point clearly in the direction of targeted aquaculture as the best approach to meeting growing world demand for fish.

The fish value chain is essentially made up of 3 sub-categories – production, processing and ancillary. Fish fingerling hatcheries, Fish production, Fish feed production, Fish farm supplies are some of the activities which make up the production category, while Fish processing includes Filleting, Drying, Gutting, scaling and deboning, Smoking, Production of fish paste and Production of fish oil. Ancillary activities include Storage, Packaging, Warehousing, Marketing, Haulage, Distribution, Freighting and all export related activities.

With a target to produce over 1million tones of fish per annum within the next 5 years, the Transformation of the fish industry will involve virtually all other sectors of the economy including air and road transport, education, agriculture, finance, science and technology, energy and telecommunications. However, the socio-economic benefits of a successful Transformation process will more than justify the immensity of the task at hand.The Transformation Process, under the Chairmanship of President Jonathan Goodluck and under the Stewardship of the Honourable Minister for Agriculture marks a turning point in the history of the agriculture sector as a whole and the fishery

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sub-sector in particular. We estimate that over 500,000 new jobs will be created directly from the Transformation process with a projected industry valuation in excess of N1trillion.

1.0 Introduction

Fish constitutes about 41% of the total animal protein intake by the average Nigerian hence there is great demand for fish in the country. Nigeria requires about 2.66 million metric tons of fish annually to satisfy the dietary requirement of its citizens (150 Million). Regrettably, the total aggregate domestic fish supply from all sources (capture and culture fisheries) is less than 0.7 million metric tons per annum. Nigeria has to import about 0.7 million metric tons of fish valued at about $500 million annually to augment the shortfall. This massive importation of frozen fish in the country has ranked Nigeria the largest importer of frozen fish in Africa (See Table 1). The huge sum of money spent by Nigeria annually in fish importation could be used to invest in fish farming. Nigeria can substitute fish importation with domestic production to create jobs, reduce poverty in rural areas where 70% of the population lives and ease the balance of payments.

A review of the various food production systems reveals aquaculture (fish farming|) as an important strategy in the global fight against hunger, malnutrition and poverty, particularly in the developing nations including Nigeria. Aquaculture is considered as the provider of the direly needed high quality animal protein and other essential micronutrients because of its affordability to the poorer segments of the community in addition to the provision of employment opportunities and cash income. The Food and Agriculture Organization of the United Nations (FAO) classified aquaculture as the World’s fastest growing food production sector for nearly two decades globally; the sector has shown an overall average growth rate of 11.0% per year since 1984, compared with 3.1% for terrestrial farm animal meat production. Nigeria has the capacity to attain the desired fish self-sufficiency within a short of time if the

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numerous aquaculture potentials (land 1.7 million Ha and water, 14 million ha), which abound the nation is adequately utilized. These potentials are estimated at about 2.5 million metric tons of fish annually. Aquaculture has experienced a long developmental process in Africa, with early beginnings in the colonial period of the 1950’s with farming of tilapias. For decades fish farming was promoted as a subsistence level agricultural activity with thousands of small farm ponds built across much of sub-Saharan Africa, most of which contributed little to the supply of fish. Without adequate fish seed, feeds or technical assistance, these ponds did not achieve significant production.

However, in some areas they helped farmers reduce risk and many continue to contribute at a modest level to rural food security, involving both men and women. With capture fisheries under pressure and with regional fish consumption declining, African governments are increasingly looking to aquaculture to fill the supply gap. As a consequence, there is increasingly widespread interest in identifying and promoting more significant, viable and productive forms of aquaculture.

Nigeria’s aquaculture development followed a similar development path from the colonial era, during which more than 2000 small-scale subsistence level ponds were built, with some growth continuing in rural areas. However production has been insignificant in national food supply terms. Nigeria’s strongly growing population, at some 150 million and its very high demand for fish, has now positioned it on a much stronger market-driven path, based on commercial production in peri-urban areas. This has shown a remarkable 20% increase in growth per year for the past six years, with high growth in small-to-medium enterprises, and a number of large-scale intensively managed fish farms. Together with Egypt and S Africa, Nigeria is now one of the most significant and strongly growing aquaculture producers in the region. As noted by Muir et al (2005), Nigeria’s fast growth in aquaculture is a replication of that observed in other regions where the market has been a key factor in driving growth. A further phase of expansion is now being developed, with government youth employment programmes, some 20% focusing on fish farmer training, to promote wider social engagement and to attempt to stem the exodus from rural areas. It is reported that 30% of new investment in agriculture programmes are in fish farming with bankers now more informed and willing to consider loans in this sub-sector.

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With high demand for fresh fish and consumer preference for fresh water catfish (Clarias gariepinus), the Nigerian private sector launched fish farming in earnest around 2000, with the rehabilitation of many abandoned fish farms and new investment in others. By 2003, a nation-wide inventory totalled 2,642 fish farms (AIFP, 2004; Brummett, 2007) with annual production estimated at some 30,000 MT by the Federal Department of Fisheries (FDF Annual Report, 2007). Such has been the impact of market demand; this has now reached some 153,000 MT annually.

2.0 Goal

To create an enabling environment for the increased and sustainable production of over one million metric tonnes of aquaculture fish and to generate five hundred thousand jobs within five years.

3.0 Objectivesa) Development of the various products along the aquaculture value chainb) Establish the chain linking up the market to consumersc) Establish, maintain and enforce quality standards along all the value chains backed up by appropriate regulation

for the purpose of fish farms certificationd) To reduce importation/eliminated aquaculture products and inputse) To increase production of aquaculture products to arrive at over 1 million metric tonnes in 5 yearsf) Employment generation for food security of Nigeriansg) To improve cultural, social and economic benefits from Nigeria's aquaculture resourcesh) To generate foreign exchange through export of aquaculture productsi) To create enabling environment for small scale fish farmers to be part of the value chainj) To encourage clusters of farmers to produce fish that will service fish processing and packaging plants

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3.0 Expected Outputs

a) 1.25 billion fish seeds per annumb) Production of 400,000MT of fish feed per yearc) Production of 250,000MT of table size fish in a yeard) Create 100,000 jobs per annum for the next five years

4.0 Present Time-line: 1year (2011-2012)

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TABLE 1: TIMELINE OF BROODSTOCK, FISH SEED SUPPLY AND HATCHERY DEVELOPMENT VALUE CHAIN

S/No

Activities 2011 2012 Budget (N)M

Oct Nov Dec J F M A M J J A S O N D1 Identify and document Fish seed producers and Hatchery

Owners√ √ √ 10

2 Identify and document Broodstock Banks in all Agro Ecological Zones

√ √ √ 5

3 Identify and aggregate needs of Broodstock banks and seed producers e.g infrastructure etc.

√ √ √ 5

4 Establish networks and cluster level Broodstock Banks and hatcheries

√ √ √ √ √ √ √ √ 20

5 Certify qualified Broodstock Banks and hatchery operators √ √ √ √ 106 Train Certified Hatchery operators (Operations management,

aquabusiness and ICT)√ √ √ √ √ √ 20

7 Aggregate existing research results in broodstock and seed production

√ √ √ √ √ √ √ 10

8 Conduct Research into other local fish species √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ 509 Link seed producers, Broodstock producers and hatchery owners

to credit, to upscale and upgrade infrastructure to increase production

x x x x x x x x x x x x 250

10 Production of Broodstock, Seed and Hatchery Producers “Farmers’ Guide

x x x x x x x 2.50

11 Creation of website and information database for aquaculture value chain industry

x x x 1

12 Monitoring, evaluation and coordination to ensure operational and financial compliance

x x x x x x x x x x x x x x 100

Sub-Total – N 483.50

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TABLE 2: TIMELINE OF FISH PRODUCTION VALUE CHAIN

S/No

Activities 2011 2012 Budget (N)M

Oct Nov Dec J F M A M J J A S O N D1 Identify and document commercial fish farmers √ √ √ 102 Certify qualified commercial fish farms √ √ √ √ √ 53 Form at least 10 fish farm clusters in each state of the federation

(SW, SE,SS, NW, NE and NC)√ √ √ √ √ √ √ √ √ 5

4 Estimate total present production and installed capacity √ √ √ √ √ √ √ √ √ 205 Train fish farmers in Best Aquaculture Management practices √ √ √ √ √ √ 106 Train fish farmers in Aquaculture Business and ICT √ √ √ √ √ √ 207 Link producers to credit via producer groups, cooperatives,

associations to scale up production and vertically integrate √ √ √ √ √ √ √ 500

8 Evaluate existing infrastructure √ √ √ √ √ √ √9 Upgrade and upscale production facilities by producers √ √ √ √ √ √ √ √ √ 25010 Link producers to sources of inputs i.e. seed and feeds supplies √ √ √ √ √ 1011 Identify water bodies, (Dams and reservoirs ) suitable for cage

culture and enhancement purposes (FMWR)x x x 10

12 Study/ survey (assessments) of water bodies for enhancement purposes

x x x x 20

13 Link producers with processors for value addition x x x x x x x x x 514 Production of Fish Producers’ Manual x x x x 2.515 Creation of website and information database for aquaculture

value chain industry (same website with the Fish Seed, Broodstock and Hatchery)

x x x 1

16 Link Producer groups to Aquaculture Marketing corporations for guaranteed price. Link producers to markets on the Value chain group website and market information services.

x x x x x x x x x 2

17 Monitoring, evaluation and coordination to ensure operational and financial compliance

100.00

Sub-total N 970.50

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TABLE 3: TIMELINE OF FISH FEED PRODUCTION AND SUPPLY VALUE CHAIN

S/No

Activities 2011 2012 Budget (N)M

Oct Nov Dec J F M A M J J A S O N D1 Identify and Certify Fish Feed producers √ √ √ √ √ √ √ 102 Identify and certify local fish feed suppliers and marketers √ √ √ √ √ √ √ 53 Estimate total quantity of feeds imported and quantity produced

locally√ √ √ √ 5

4 Establish certification protocols for feed quality and supplies √ √ √ √ √ √ 205 Train producers and suppliers on quality assurance, feed

production technology and handling and ICT√ √ √ √ √ √ √ 10

6 Link feed producers and suppliers to fish farmers through producer groups

√ √ √ √ √ √ 10

7 Establishment of Fish feed Quality monitoring system √ √ √ √ √ 108 Facilitate access to credits for equipment and raw materials √ √ √ √ √ √ √ 5009 Train feed producers and distributors in marketing and

distribution strategy√ √ √ √ √ √ √ 20

10 Business roundtable with feed suppliers √ √ √ √ 2011 Production of Feed production Technology Manual √ √ √ √ √ √ √ 512 Monitoring, evaluation and coordination to ensure operational

and financial compliance √ √ √ √ √ √ √ √ √ √ √ √ 50

Sub-total - N 665.00

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TABLE 4: TIMELINE OF FISH PROCESSING VALUE CHAIN

S/No

Activities 2011 2012 Budget (N)M

Oct Nov Dec J F M A M J J A S O N D1 Identify and document Fish processors and existing facilities √ √ √ √ √ √ 102 Estimate and evaluate present capacity and existing gap in Agro

Ecological Zones√ √ √ √ √ 5

3 Mobilise and dialogue with fish processors √ √ √ √ 54 Develop protocol for certification of fish processors √ √ √ 205 Organise trainings for fish processors on appropriate technology

and business√ √ √ √ √ √ √ √ √ 10

6 Identify locations in the six (6 Nos.) zones for the establishment of model fish processing centres

√ √ √ √ √ √ √ 20

7Link processors with credit through processor groups

√ √ √ √ √ √ 10

8 Establishment of functional and vibrant fish processors’ network √ √ √ √ √ √ √ 209 Facilitation of establishment of 6 Standard fish processing

centres at one (1Nos.) per agro- ecological zone√ √ √ √ √ √ √ √ √ √ √ √ 600

10 Enforce best processing practices √ √ √ √ √ √ √ √ √ √ √ √ 2011 Creation of website and information database for aquaculture

value chain industry 1

12 Production of Fish Processors Manual √ √ √ √ √ √ 2.513 Monitoring, evaluation and coordination to ensure operational

and financial compliance √ √ √ √ √ √ √ √ √ √ √ √ √ √ √ 50

Sub-Total – N 773.50

TOTAL BUDGET FOR YEAR1 (OCT.2011-DEC.2012) N 2.892 Billion

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FIGURE 2: LOG FRAME FOR FISH SEED AND HATCHERIES DEVELOPMENT

GOALS OBJECTIVELY VERIFIABLEINDICATORS OFACHIEVEMENT

INTERVENTIONLOGIC

ASSUMPTIONS/RISK FACTORS

2 billion fingerlingsproduction perannum;Providing premiumquality broodstocks with fastgrowing diseaseresistant seed forthe fish productionvalue chain.

Establishment of20 hatcheries perannum over 5 years giving an industry base of100 hatcheries.

Adequate/surplus supply of qualityseeds (fingerlings) for the fish production sector;Increased vibrancy along entire value chain.

Rate of growth of seeds to fish production sector,reduced mortality and average harvest size.

No. of new entrants into the hatchery sector; No. of jobscreated directly andindirectly in the

The hatcherysector to growat 20% perannum.

Governmentand privatesector researchand analysislaboratoriesremain active,relevant andfunded.

Risk of hatcherysector NOT

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Creation of 10,000hatchery jobs in 5years; Creation ofa =N=50 billionindustry.

Distribution ofhatcheries

Nationwideproviding fishproduction sectoreasy access tohatchery to the tune of at least 10 per state.

hatchery sector.

Amount of directinvestment in hatcheries asprofit oriented investorschannel funds to the sector.

Physical evidence of new hatcheries operating in thedesignated states within stipulated time; increase in the number of fingerlings available;

growingproportionatelyto the fishproductionsector leading toeither scarcity orglut.

Uptake of theBusiness opportunity byOperators instead of other competinginvestments inaquaculture andagriculture as awhole.

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FIGURE 3: LOG FRAME FOR THE FISH PRODUCTION SECTOR

GOALS OBJECTIVELYVERIFIABLEINDICATORS OFACHIEVEMENT

INTERVENTIONLOGIC

ASSUMPTIONS/RISKFACTORS

Over 1 million tonnes of raw aquaculturefish within 5 years:Installation of 22000fish cage culturesystems across,dams, reservoirs and rivers Nationwide @500 cages perannum;Installation of additional50 water recirculatoryaquaculture systemsNationwide and encouraging more

Adequate/surplussupply of table sizefish to end users;Adequate/surplussupply of fish tothe fish processingsector;Reduction inimport bill for fish.Increased exportearnings;Reduction in priceof table sizeaquaculture fish;No. of newentrants into thefish productionsector and jobscreated;Amount of directinvestment in the

Quality control inline with HACCP,Codex etc, standardsAVCG/FDF toembark on moretraining andspecializedextension services;Ministry of WaterResources to makewater bodies(Dams, reservoirsand rivers)available to privateoperators/investors

Study of cage culture systems inAsian tigercountries where

Conduciveatmosphere for theindustry;Nig consumption of1.55m tonnes of fishto increase at a rateof 10% per annum;Authorities toensure closemonitoring levelof imported fishentering the Countryand export fishleaving the Country;Fish processingindustry expected togrow at a rate of atleast 25% perannum;AdequateStorage/preservation

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people go into flow-through systems and integrated fish farming; designated fishprocessing zones and aquaculture parks ;Creation of over500,000 jobs in theproduction sector;Creation of anindustry size of over=N=500 billion.Creation of a newmarket in Organicfish for the local and lucrative export markets.

production sector aquaculture hasbeen rising at animpressive rate;State and LocalGovernment buy-inof the program toenhance jobcreation andwealth creation;Grants for researchinto feed technology feedingtechniques andwater management.Leasing programsfor equipment andthe establishmentof aquacultureparks nationwide.Infrastructuresystems to be setup for storage andmovement of rawfish to buyers;Marketing boardsto ensure fairpricing for farmers.

solutions forincrease in fishproduction;Efficient diseasemanagement;

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FIGURE 4: LOG FRAME FOR FISH PROCESSING SECTOR

GOALS OBJECTIVELYVERIFIABLEINDICATORS OFACHIEVEMENT

INTERVENTIONLOGIC

ASSUMPTION/RISKS

Output of over 1Million tonnes ofprocessed fish in 5years:Establishment of: One medium-sizedprocessing plant of60,000 mt per zone initially for the first yearannum;Creation of aN900 billionindustry;Boom in the varioussub sectors of thevalue chain:- Filletting- Smoking- Canning- Pates- Spice

Availability ofprocessed fish forlocal consumptionand export;Reduction of importbill on regularprocessed fishimports, eg,sardines, pilchardsetc;Reduction in lossesfrom the fishproduction industrythereby reducingprices;New entrants intothe processing subsector;Job creation asyouths add value toraw products.

Fish processingzones at majordams, reservoirsand riversNationwide;Leases available toinvestors/operatorsto run plants on PPParrangement priorto full private sectortake over;Government tocreate enablingenvironment fordonors, Foreigndirect investment,Nigerian investors;Duty waivers onmachinery forestablishment ofplants;Tax holidays and

Nigeria’s hugedemand for fishproducts of over 1.5million tonnes palikely to increase asproducts becomecheaper;Local andNeighbouringCountries demandto increase at 10%p.a.;Continued depletionof capture fisheriestake annually;Nigerian consumersacceptability ofprocessedaquaculture fish asagainst moretraditional productsand their readiness

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preparation- Cooking, Grilling

other incentives fornew entrepreneurs

to pay the premium.

FIGURE 5: LOG FRAME FOR FISH FEED SECTOR

GOALS OBJECTIVELYVERIFIABLEINDICATORS OFACHIEVEMENT

INTERVENTIONLOGIC

ASSUMPTIONS/RISKS

Over 1.8million MTof aquaculture fishfeed per annum in 5years:Establishment of 90top grade fish feedmills (of 20,000tonnes per annum)at 18 per Year for 5years;Creation of over2,500 new jobs;Creation of aN230 billionindustry.

Availability andproximity of fishfeed for the localaquaculture fishproduction industryand for export;Reduced cost offeed;

Faster growth ofproduction sectorfish due to betterquality feeds;

New investors andmore directinvestment in thesector.

Monitoring of feedquality and effectson fish growth;Research grants toUniversities andprivate researchersto continuouslyimprove feedquality; Assistance to the industry to reduce raw material costs;Duty waivers andsubsidies on plantand equipment;Tax holidays andother incentives forinvestors; Regulation of feed importation to monitor quantity

1 Million tonnes ofaquaculture fishproduced by theproduction subsector therebyguaranteeingdemand;Nigeria’s demandfor fish productscontinue to grow atabout 10% perannum;Poor managementand preparation offeed leading to poorquality and loss ofinvestment.Adequate localproduction of fish feed components to meet

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and quality increase in demand.

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6.0 Total Budget Summary(5years): N23.90 Billion.

7.0 StrategyThe strategy for the attainment of these goals is increase production and activities along the aquaculture value chain. The set goals were on the aquaculture production potential based on existing output using existing infrastructure thus;

a) Present water surface area under fish production - 60,000 hab) Present aquaculture production - 153,000 tonsc) Production per hectare - 2.55 tons/ha

d) Potential production under intensive culture system - 18 tons/ha

e) Production gap - 15.45 tons/haf) Nigeria’s Fish Demand per annum - 2.5 million tons

To meet existing and projected demands as shown in Table 1, through aquaculture production will therefore require doubling the hectarage under production, i.e. to 120,000 ha at 18 tons per hectare maximum production, the establishment of WRS and other intensive systems that can produce 40 tons per hectare or combination of the various systems.

7.1 Market Development

However, success of the value chain development depends on sustain and profitable production at the same time guaranteed good market. To ensure these, production and processing chain levels (Figure 1) will be linked up with some definite markets such as the fast food chains, School Feeding programme1, hospitals and prisons feeding, etc.

7.2 Aquaculture Value Chain Coordinating Unit

Coordination and support from the Government is critical to the success of this programme. The unit should be autonomous of the bureaucratic system if targets are to be met within the stipulated timeframe.

1 School Feeding Programme planned by the Fed. Ministry of Education targets 12.5 million school children. If fish is to be integrated at 10 grams per child per week will create a demand for cultured fish for 7 million metric tones per annum. This translates into 700,000 jobs per annum.

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Table 5: F ISH SUPPLY – DEMAND PROJECTION (2000 – 2015)

Year Projected Population(Million)

Per Capita Fish

consumption (Kg)

Projected Fish Demand(Tons)

Projected Domestic

Fish Production

(Tons)

Fish SupplyGap Deficit

(Tons)

2000 114.4 13.5 1,430,000 467,098 962,902

2001 117.6 13.5 1,470,000 480,164 989,836

2002 121.0 13.5 1,512,500 507,928 1,004,572

2003 124.4 13.5 1,555,000 522,627 1,032,373

2004 128.0 13.5 1,600,000 536,918 1,063,082

2005 131.5 13.5 1,643,750 552,433 1,091,317

2006 135.3 13.5 1,691,250 567,949 1,123,301

2007 139.1 13.5 1,738,750 583,872 1,154,878

2008 143.0 13.5 1,787,500 600,613 1,186,887

2009 147.1 13.5 1,838,750 617,353 1,221,397

2010 151.2 13.5 1,890,000 634,560 1,255,440

2011 155.5 13.5 1,943,750 652,606 1,292,143

2012 160.0 13.5 2,000,000 671,492 1,328,508

2013 164.4 13.5 2,055,000 689,958 1,365,042

2014 169.1 13.5 2,113,750 709,683 1,404,067

2015 174.0 13.5 2,175,000 730,248 1,444,752

8.0 Fish Supply and Demand Dynamics in NigeriaNigeria’s fish supplies come from four major sources (in their order of importance) namely:

a) Importationb) Inland, estuaries and coastal artisanal fisheryc) Industrial trawl fisheryd) Aquaculture

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9.0 Aquaculture Value Chain StructureThe aquaculture value chain is recognised as comprising various levels as shown in Figure 1 while Figure 2 maps out the chain elements and responsibilities. These are directly and/or indirectly related to fish production, but are essential links in the fish-to-wealth cycle.

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Equipment.Broodstock, Fish Seed

Fish Feeds

Extension, Research, Finance, Aquabusiness Development, M&E.

Handling of Fish and Feeds for Transport and Logistics

Fish Production from WRS, Pond Farms, Cages, Integrated farms

Transport of Live & Table Fish

Live Fish Markets

Consumers (Restaurants, Fish Shops, Food Industries, Schools, Prisons, Hospitals, Homes.

Table Fish MarketsFish Processing Freezing, Drying, Smoking, Filleting, Canning, Food Additives

Direct Sales to Consumers

Auto Consumption

Extension, Aquabusiness, Finance, Research and other support services will be

closely monitored to facilitate and ensure regulations compliance.

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FIGURE 1: AQUACULTURE VALUE CHAIN STRUCTURE

AQUACULTURE VALUE CHAIN ACTIONS

1. Increase production2. Vertical integration/economies of scale3. Marketing4. Supply chain/transport improvements, infrastructure5. Access to working capital, single digits loans6. Cost-sharing for inputs, cooperatives, associations bulk

buying

FIGURE 2: AQUACULTURE VALUE CHAIN MAP

VALUE CHAIN INPUT PRODUCTION PROCESSING MARKETING CONSUMPTION

ELEMENTS Broodstock, Seeds, Feeds,

Flow Through, Water

Fresh (Frozen), Smoked, Fillet,

School Feeding Program, Fast

Restaurants, Fish bars, Homes,

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Equipments, inputs

Recirculatory, Cage Culture, Integrated Culture

Fish Oil, Fish Cake, Food Additives

Food Chains, Food Processing Companies

Schools, Prisons, Hospital

OPERATORS Inputs Producers, Inputs Suppliers

Farmers Corporation

Processors, Packagers, Transporters, Aquaculture industries

Traders, Exporters

TECHNOLOGY Broodstock Banks, Hatcheries, Fish Feed Milling, Equipment Manufacturing, Research

Semi-intensive, Intensive

Ice freezing, Plastic Packaging, Canning, Oil Press, Smoking Kiln, Food additive (seasonings)Extraction, Research

Local market, Super markets, Home Delivery, Fish Shops, Logistics,

Research

STAKEHOLDERS Private Sector, Research Institutes, Universities

Farmers, NGOs Processors, Private Sector, Industries

Marketers, Transporters, NGOs, Private Sector

POLICY Import Tax ExemptionStandardizationQuality control and Assurance

Land tenureTax ExemptionGuaranteed Market Contracts Production

Quality Standards and ComplianceGuaranteed marketInfrastructure Development

Infrastructure DevelopmentSupply Agreements, Quality Assurance

FINANCE

MONITORING AND IMPACT EVALUATION

COORDINATION, REGULATION, CONTROL, AQUABUSINESS DEVELOPMENT, SUPPORT

Activities relating to the levels are as follows:

A. Production Increase:a) Lease of containment vessels for fish productionb) Lease or outright purchase of tanks and water recirculation plantsc) Broodstock production and managementd) Production of fingerlingse) Feed productionf) Feed purchase for rearingg) Working capital for day to day operations

B. Processinga) Filleting

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b) Dryingc) Gutting, scaling and deboningd) Smokinge) Canningf) Food additivesg) Cooking, grillingh) Production of fish pastei) Production of fish oilj) Refrigerationk) Production of fish meall) Any other activities with demonstrable ‘’value added’’ to one or more of

the traditional levels in the aquaculture value chain.

C. Ancillariesa) Storageb) Packagingc) Warehousingd) Marketinge) Haulagef) Distributiong) Freightingh) All export related activities

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10. CONCLUSIONS

Fish is a very important component of human food systems in Nigeria and while farming fish had been very significant to the public sector for several years but for the private sector, it has just in the last twenty years, become a major investment outlet.

Currently, fish has not only become a major item of the Nigerian diet, it has also attained a major dominance in Nigeria’s food import and the overall food security. The issue of the fish import is the driving force behind the setting of this value chains. Thus, at the end of it all, Nigeria will be able to produce at least one million tonnes of fish to augment its national fish demand. According to traders and retailers, product losses (fish death, quality loss) and finance are the most common challenges cited by fresh catfish traders and retailers. Fresh and living catfish command a retail price twice that of frozen fish.Traders and retailers do not use proper storage facilities, do not change the water sufficiently, and often leave the fish in the sun for long periods—all leading to product loss and lower quality, which translate to lower revenues. Traders indicate that limited finance constrains the ability to develop and invest in business operations or expansion. Nigerian catfish farmers report that the marketing of fresh catfish is becoming more difficult because of increasing competition. Some farmers in the southeast also recognize that the difficulties in selling fish result from a general lack of organization (for example, farms all try to sell fish on the same day). To control marketing problems, farmers say that they would like to have direct contact with traders further down the marketing chain. Farmers have indicated that information sharing within the value chain is sparse and that there is frustration that primary wholesalers shield their sources of supply from secondary wholesalers and retailers. In addition, in some locations, retailers feel that they have to pay higher prices than necessary because they are unable to buy direct, or at least need better information about the selling prices at the farm. The urban markets, where farmed fish is primarily sold, will grow by up to percent annually through population growth and other factors.Once these sources of demand have been met, additional supplies will be absorbed by stimulating sales through lower retail prices, the addition of value-added operations, or exports. WE HEREBY SUBMIT THAT IT IS POSSIBLE TO PRODUCE 1 MILLION TONNES OFFISH THROUGH AQUACULTURE WITHIN THE NEXT FIVE YEARS.

THE AQUACULTURE VALUE CHAIN GROUPFEDERAL MINISTRY OF AGRICULTURE AND RURAL DEVELOPMENTABUJA.

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OCTOBER 2011

Annex 1. Current Production Level and Yearly Targets

FISH FEED MILLS:

One million tonnes of fish using a conversion factor of 1:1 will require one million tonnes of feed. At present costs of approximately N230 per kg this translates to a N230 billion industry.

A medium size feed mill can produce 50 tonnes of fish feed per day, which translates to about 20,000 tonnes per annum. This translates to the need for about 50 feed mills to service the industry at a cost of N50 million each

YEAR ADDITIONALFEED MILLS

COST (N) JOBS FISH FEEDPRODUCED(TONNES

1 10 500,000,000 500 200,0002 10 500,000,000 500 400,0003 10 500,000,000 500 600,0004 10 500,000,000 500 800,0005 10 500,000,000 500 1,000,000TOTAL 50 2,500,000,000 2500 3,000,000

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Annex 2: Storage and Processing Requirements

Raw material Quality

The most important factor affecting the quality of a fish product is the freshness of the raw material immediately prior to processing. Poor quality raw fish produces poor quality end product.

Processing helps to slow down the rate of deterioration, using spoiled fish as the raw material can only produce poor quality products. It is therefore of great importance that processors and consumers can recognize characteristics signalling deterioration in fish, which include overall appearance, skin texture, smell, eyes, gills, and mucus coating.

Packaging of Fish and Fishery Products

Packaging is a means of ensuring the safe delivery of a product to the ultimate consumer in sound condition at minimum overall cost. There are three basic functions carried out by all packaging material:

a) Containment, enabling a specified quantified quantity of foodstuff to be handled conveniently as a single unit.

b) Protection of a foodstuff against the various hazards of distribution such as climatic influence, mechanical forces, contamination and pilferage.

c) Information about the product or its destination or ownership, and when linked with advertising, this must convey to the consumer a favourable company and product image.

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Annex 3: Product Promotion Targets

Analysis of Nigeria’s potentials in the area of natural and human resources, five (5) years of aquaculture fish production should produce one (1) million tonnes per annum. This will further stimulate activities along the fish value chain. Production targets associated with this within 5 years are detailed below:

Item Production target

Fish production from aquaculture 1 million tonnes per annumFingerling production 2 billion fingerlings per annumProcessing 1 million tonnes per annumFish feed 1 million tonnes per annum

Quality

Food safety is inextricably related to food security as food is only valued highly when it is regarded to be safe. The creations of food safety awareness will not only serve to promote food security and trade but also assist in the elimination of constraints of market gain; through the adoption of new technologies.

Industrial countries will also get better reassurance that imports from Sub-Saharan Africa are safe, while developing countries will improve both domestic food production standards and be able to expand their export markets. Improvements of hygiene in food handling and processing and introduction of tools like hazard analysis is a task which is vital for the prevention of spreading diseases, contamination of food items and establishment of consumer confidence.

In international trade, food safety is a dominant factor in overseas partners’ requirements. Today, all food items must not only be produced in a safe environment, but the environment must also be documented, e.g. in the form of HACCP (Hazard Analysis and Critical Control Point) based quality assurance systems, Codex Alimentarius principles, FAO Code of Conduct for Responsible

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Fisheries or similar precautions. Nigeria’s fish sector has suffered what other sectors of Agriculture with regards to quality control and our potentials to export our produce. Recommendations on the new fish production drive should go in tandem with new quality control measures, which are in conformity with all international quality control protocol. The quality of fish and fish products meant for consumption needs to be assured and controlled according to internationally accepted guidelines especially to meet available export demands.

Annex 4: Institutional Capacity Targets

The supervising authority over the whole fishing industry is the Federal Department of Fisheries (FDF) of the Ministry of Agriculture and Rural Development. State Ministries and the ADPs will be co opted for maximal reach to the grassroots level. Production targets of 1 million tonnes of fish per annum through aquaculture is going to require more well trained staff of the FDF and the relevant State ministries staff to ensure compliance with Government policies and International partners.

Courses will be organized and FDF staff trained on new aquaculture methods, quarantine techniques and other areas in the industry to keep them abreast with International best practices. This is essential so as not to cause unnecessary bottlenecks to the aquaculture Industry.

Customs and Excise department of Government, bankers and other relevant ministries must also be recruited and trained in conjunction with FDF staff to monitor the industry compliance with regulations.

Annex 5: Fiscal Targets

The Fish Value Chain Group has set the following Fiscal targets in the Fish industry.1. Fish Value Chain total industry value of over N1 trillion within 5 years

a) Hatchery Industry N50 billionb) Fish production industry N500 billionc) Fish Processing industry N900 billiond) Feed mill industry N230 billion

2. Fish Value Chain industry job creation of over 500,000 jobs within 5 years and with a minimum wage of N18,000 per annum translates to =N=9 billion in the hands of Nigerians.

a) 10,000 Hatcheries jobsb) 500,000 Fish production Jobs

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c) 3,700 Fish processing jobsd) 2,500 Feed mill jobs

All jobs under the Aquaculture Value Chain give equal opportunity to men, women and the youths. Federal Government to receive over =N=1 billion in new taxes 5 years down the line.

Annex 6: New Investment Required to Support the Entire Value Chain

Relevant Investments for the Aquaculture Value ChainThe following investments will be necessary to support the entire value chain in Aquaculture. Such investments will be divided into Pre-Production, Production, Processing, Marketing and Packaging. There are also subsidiary investments like Research and Extension as well as Training and Capacity Building.Pre-Production: Such investments will be as follow:

a) Hatcheriesb) Laboratories for water and chemical analysisc) Production Systems: Such investments will be as follow:d) Fish Cage Culturee) Fish Tank productionf) Concrete Pond Constructiong) Earthen pond Constructionh) Enhancement of dams and reservoirs in all states of the federation

Processinga) Development of small, medium and large processing plantsb) Development of Cold Chainsc) Development of filleting technologyd) Development of smoking technology

Marketing and Processinga) Development of Modern fish marketsb) Development of packaging

On the subsidiary areas, investments will be in the area of production of investors’ guides, enactment of laws on food safety, and the incorporation of general infrastructural development plan with aquaculture and other dependent sectors.

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Annex 7: Key Constraints and Possible Solutions: Aquaculture Value Chain

Strategy: Increase and improve the value added products in freshwater fish species such as tilapia carp and catfish for the growing urban/local markets.Key Constraints Solutions Facilitators and

ProvidersIllustrative Interventions

Insufficient development of the fish processing.

Under-utilizationof the seafood processing capacity.

Insufficient knowledge,technology andinvestment foraquacultureproducts forstorage andtransport.

Improvement onthe post-harvesthandling techniques

-Improving on thecold chaininfrastructure.

Processing Industry

Fish FarmersAssociation

The three tiers ofGovernment

Private Sector

Linking leaders in theseafood processing industrywith an organized producergroup

Create a business model fora simple value addedprocessing plant.

Improvements in harvest, transport and handling.

Insufficient foodsafety and traceabilitystandards.

Unsustainablefood safetypractices along thevalue chainhinders enteringinto higher valuemarkets.

Promote compliance with EU standards

Develop a National Standard

ConsultantsDevelopment partners.

Conduct Seminars andCertification

Develop a code of conduct for national standard.

Access to microcredit Link fish farmersto businessdevelopmentservices andmicrocreditproviders

Local NGOs,Government, business associations.Donors and supportiveOperators.

Organize forums for farmersto address micro-credit access constraints.Facilitate disseminationof micro-credit providers information through local media

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Insufficientinvestment andlack of information

Support leadingfirms and extensionagents.

Engage leadingservice providersand inputsuppliers toimprove andexpand services andinput delivery tofish farmers.

Leading buyers (e.g.,wholesalers, restaurants,large processors,exporters).

National andinternationalinput suppliers (e.g.,fish feed and chemicalcompanies, fry andfingerling producers).

Regional experts, tradefair and other eventorganizers.

Local service providers (e.g.extension agents,trainers in fish raising).

Facilitate private sector provision of training in Fingerling and fish raising.

Work with financialinstitutions to expand services and develop new products for fish farmers and input suppliers.

Support private investment in hatchery, brood stockmaintenance and quality controlling operations

INFRASTRUCTURE IN AQUACULTURE

The present level of Government infrastructure is minimal with no participation in the 2 major areas of aquaculture: Seed and Feed. Along the lines of the objectives above, the following infrastructure is being proposed by the value chain group.

Hatcheries.To achieve the aim of 1 million tonnes of fish in 5 years we must be able to produce at least 2 billion fingerlings annually. At an average cost of N25 per fingerling, we are looking at a N50 billion per annum industry.If we estimate that a top quality Hatchery should be able to produce 20 million fingerlings per annum and cost N50 million then we will need 100 hatcheries in the next 5 years.

HATCHERY BENEFIT ANALYSIS

YEAR NO OFADDITIONALHATCHERIES

COST OFHATCHERIES

JOBSCREATED

FINGERLINGSPRODUCED PERANNUM

1 20 200,000,000, 2,000 400,000,0002 20 200,000,000, 2,000 800,000,000

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3 20 200,000,000, 2,000 1,200,000,0004 20 200,000,000, 2,000 1,600,000,0005 20 200,000,000, 2,000 2,000,000,000TOTAL 100 1,000,000,000 10,000 2,000,000,000

The jobs created include both direct employment at the labs and entrepreneurs who join the value chain to market fingerlings.

Primary Fish Production Models:

A projection of 1 million tonnes of fish per annum with a conservative price of N500 per kg translates to a N 500 billion per annum industry.The value chain group believes that the major areas to increase fish production are:1. Fish cage culture systems2. Water recirculatory systems (WRS)3. Flow-through systems4. Integrated Fish farmingThis leads us back to utilization of our numerous water bodies in the Country for the establishment of fish processing centres.Analysing the figures it would be suitable to apportion our planned production of 1 million tonnes of fish as follows:Fish cages: 100,000 per annumWRS: 250,000 per annum.Flow-through: 500,000 per annum.Integrated fish farming: 50,000 per annum.Stagnant earthen ponds: 100,000 per annumThis translates as follows:

CAGES

YEAR ADDITIONALCAGES

COST(N)

JOBS FISH PRODUCED(TONNES

1 200 200,000,000 2,000 40,0002 500 1,000,000,000 5,000 140,0003 500 1,000,000,000 5,000 240,0004 500 1,000,000,000 5,000 340,0005 500 1,000,000,000 5,000 440,000TOTAL 2200 4,200,000,000 22,000 1,300,000

WATER RECIRCULATORY TANK SYSTEMS

YEAR ADDITIONAL COST JOBS FISH

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WRS SYSTEMS

(N) PRODUCED(TONNES)

1 20 1,000,000,000 50,000 60,0002 50 2,250,000,000 50,000 120,0003 50 2,250,000,000 50,000 180,0004 50 2,250,000,000 50,000 240,0005 50 2,250,000,000 50,000 300,000TOTAL 220 10,000,000,000 250,000 900,000Fish ProcessingOne million tonnes of fish is a huge amount and has potentials for vast value addition. Itemised below is a list of value addition chains and potential income. Value addition systems have the potential of adding up to N900 per kg of fish which translates to a N900 billion naira industry.- Gutting, scaling and deboning- Filleting- Smoking- Canning- Pates- Spice preparation- Cooking, grilling

Fish Processing Equipment Plants

To process 1 million tonnes of fish we have classified the plants into 3 categories:

PLANTCATEGORY

TONNESPERANNUM

COST PERPLANT

NO OFPLANTS

TOTALTONNAGEP/A

TOTALCOST(N)M

TOTALJOBS

Standard 30,000 100,000,000 37 150,000 3,700,000,000 3,700TOTAL 3,700,000,000

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