Players in the livestock industry have appealed for strategic storage facilities and reserves to address the disruption in supply of raw materials needed for the production of animal feed and the associated high cost.
They made the request on May 29 during a Senate session on strategies to address the animal feed issue that negatively affects livestock sector growth.
They proposed that as the domestic supply of raw materials such as maize and soybeans - which are key ingredients in animal feed production - is limited, the ingredients can be purchased locally or through import during harvest season when prices are relatively low, get stored in strategic silos, and then be provided to feed factories during lean season when prices are high.
Another case when they can be needed is during a period of supply shortage resulting from situations such as drought or disruptions in global trade.
Jean Baptiste Musabyimana, the founder of Agribusiness Solution, Agribusiness Solution (ABUSOL), a Bugesera District-based firm with around 100,000 chickens, said that there is a challenge of access to raw materials which is caused by factors including competition between animals and humans for consumption, and sourcing some ingredients from foreign countries to bridge local supply gaps - at a higher cost.
He said that there is a lack of storage facilities to have stocks of cereals that can be strategically used, and inadequate access to finance as available financial products are not tailored to livestock industry needs.
For him, the private sector can play a major role in their establishment, and the government can put in place an enabling environment. There is a need for a law governing strategic reserves, he said.
Elaborating on the practicability of the cereal reserve proposal, he said if there are factors that result in lower prices on the market compared to that at which investing entities including banks and insurance firms bought cereals in the reserve, the government agrees to cover that difference.
Such an approach, he said can lead banks and insurance firms to adopt the plan.
"We need to look for ways to attract private entities in the management of strategic reserve matters," he said.
Earlier, on May 14, Andrew Butare, the Chairperson of Rwanda Poultry Industry Association, told The New Times that the high cost of feed was the biggest challenge to poultry business, indicating that for broilers, a kilogramme of feed was more than Rwf600, while it was Rwf560 a kilo for layers from Rwf345 in 2019.
He pointed out that feed accounts for between 60 and 70 per cent of the cost of production in poultry.
"When our cost of production goes very high, we are no longer competitive on the regional markets and beyond, because there are others who are producing at a better cost," he said.
He held that the availability of strategic reserves for raw materials for livestock feed, and financing to help stock them during harvest period, can help stabilise prices of maize and soya beans, among others.
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Senator Marie Rose Mureshyankwano underscored that there is a need for enough, and low-cost livestock feed that meets quality standards.
Government intervention
The Minister of Agriculture and Animal Resources, Ildephone Musafiri, concurred with private investors in livestock sector that most of the raw materials are imported, observing that the situation is mainly due to the fact that the country is not yet self-sufficient in the production of major crops such as maize and soya beans.
"This is an issue that can be addressed by increasing productivity of our grains in the country. And we started this and we hope that in a short period such that those who need soya beans, maize, will start getting them," he said, estimating that will be addressed in two years.
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Currently, he said, there are strategic grain reserves meant to provide food relief to people affected by the shortage caused by circumstances such as disasters including drought, but there are no such facilities for livestock. Meanwhile, he pointed out that the government started thinking about their establishment.
Though strategic grain reserves for humans are also still inadequate and must be increased, Musafiri said that there was a need to introduce reserves for supporting livestock in case of geopolitical issues, hikes in feed at the market, and disruption in global supply.
The development, he said, could help to ensure the availability of animal feed and the stability of their prices.
"This is a programme we can implement in partnership with the private sector so that we have a strategic reserve for animal feed," he said.
