Onome Amuge
A decisive turning point may be emerging in the long-running effort to reduce the country’s reliance on imported milk, as industry stakeholders intensify pressure on the federal government to enforce the backward integration commitments laid out in the National Dairy Policy. What is becoming increasingly clear across the sector is a consensus that without firm and immediate regulatory action to curb rising dairy imports and compel investment into local value chains, the economy will remain structurally dependent on milk powders and creamers sourced from Europe, North America, and Asia, an exposure that analysts say is now undermining jobs, fiscal stability, and long-term food security.
The Commercial Dairy Ranchers Association of Nigeria (CODARAN), perhaps one of the most vocal industry coalition on the issue, used this week’s National Dairy Policy Implementation Framework Validation Workshop in Abuja to issue its strongest call yet for immediate and sweeping enforcement of measures contained in the National Dairy Policy. These include special levies on processed dairy imports, regulatory oversight of milk substitutes, and mandatory compliance with a 10-year import substitution programme introduced to push multinational importers into domestic cattle breeding and milk collection.
“We cannot continue this way,” CODARAN’s president, M.D. Abubakar, said, citing fresh 2024–2025 data showing a renewed surge in dairy imports despite years of government rhetoric on localisation. “This trend is worrisome. The dairy industry — and indeed the entire Nigerian economy — is waiting for the full-scale implementation of backward integration. We need processors to go upstream: invest in raw milk, feed and fodder, cattle breeding, and real partnerships with Nigerian dairy farmers,” he added.
Abubakar and other industry players pointed out that the debate is not simply about tariffs; it is about reengineering the country’s agrifood structure in a sector where Nigeria spends an estimated $1.3 billion to $1.5 billion annually on dairy imports. This import bill persists despite the government’s stated goal since 2019 to raise domestic milk output by 500 percent over a decade.
Nigeria, with a population of over 220 million, is one of Africa’s largest consumers of dairy products. Yet the domestic industry produces only a fraction of national demand, constrained by decades of underinvestment, low-yield indigenous cattle breeds, insecurity in grazing areas, and the absence of robust cold-chain and milk collection systems.
The result is a paradox: consumers want more dairy, processors want more milk, but the local supply chain cannot deliver. Importers — mostly global food conglomerates — continue to dominate market share with dried milk and creamer imports that are cheaper to store and transport than fresh milk.
According to CODARAN, this structure not only keeps Nigeria dependent on volatile foreign markets but also traps smallholder farmers in cycles of low productivity and low income.
“Backward integration is a proven formula. We have seen its impact in other agribusiness sectors. But dairy remains an outlier because we have not enforced the frameworks we already have,”Abubakar stressed.
A stalled reform agenda that billions depend on, Nigeria’s backward integration programme in the dairy industry was created to compel processors to invest in commercial ranches, upgrade cattle breeding and genetics, expand feed and fodder production, establish milk collection centres, train smallholder farmers, and commit to guaranteed milk off-take contracts.
In theory, the programme promised to reshape the industry. In practice, implementation has lagged due to weak enforcement, shifting political priorities and high upfront investment costs.
Still, several companies, including FrieslandCampina WAMCO, Arla Foods, L&Z Integrated Farms, and a handful of domestic processors, have set up dairy hubs, crossbreeding centres and smallholder clusters. But industry leaders say these early efforts are insufficient without a strong regulatory push that forces all players to comply.
“The federal government has pursued backward integration, but partial compliance is not enough. We now need full enforcement supported by functional institutions,” Abubakar said.
Abubakar urged the immediate creation of the Nigerian Dairy Development and Marketing Board (NDDMB) and the National Dairy Development Fund (NDDF); two structures outlined in the National Dairy Policy..
These institutions are meant to coordinate the sector’s transformation, support smallholders, and provide financing for dairy farms and milk aggregation systems.
Their absence, industry stakeholders say, is one of the biggest reasons Nigeria’s dairy transformation remains stuck at pilot scale.
Kenya’s protectionist model reignites debate in Nigeria
CODARAN’s renewed campaign is emboldened by recent developments in Kenya, which banned milk powder imports from neighbouring countries following an increase in local production positioned it as Africa’s second-largest dairy producer after Egypt.
The Kenyan government said the ban protects farmers from unfair competition and ensures price stability. It also cited health concerns over unregulated milk imports.
“We have warned illegal importers to stop,” Kenya’s Agriculture Minister, Mutahi Kagwe, said, noting that the country is pushing aggressively for local sourcing to meet its annual one billion-litre demand.
For Nigerian dairy farmers and ranchers, Kenya’s approach represents the kind of decisive policy action that Nigeria has hesitated to adopt.
“If Kenya can protect its farmers, why is Nigeria not doing the same?” asked a dairy cooperative leader from Kano.
Many domestic dairy operators warn that unless the federal government acts to curb imports, recent investments in ranching, breeding and milk collection may stall — or reverse entirely.
What concerns investors most is the rise in milk substitutes, particularly creamers, which now dominate Nigeria’s tea and beverage market. Creamers, often made from vegetable oils and additives, bypass dairy regulations and attract lower or no tariffs.
“These substitutes have flooded the market. They undermine the dairy sector while masquerading as milk products,” Abubakar noted.
Industry players say that levies on creamers could be the tipping point needed to redirect processors toward local partnerships.
Although its benefits are widely acknowledged, backward integration in dairy is far more difficult to implement than in sectors such as cement, sugar, or oil palm. The main barriers include low-yield indigenous cattle that produce only 1–2 litres of milk daily compared to 20–30 litres from high-yield breeds; persistent pastoral conflict and insecurity that make ranching investments risky; climate pressures such as drought and shrinking grazing fields that intensify feed scarcity; cold-chain gaps that require costly cooling infrastructure within hours of milking; and long investment cycles that take years before ranching operations stabilise
Still, CODARAN argues that Nigeria cannot afford not to invest.
“Import dependence has kept Nigeria technologically backward in dairy. Only by producing locally can we build expertise and create rural jobs,” Abubakar stated.
The stakes for Nigeria’s economic future
The dairy industry has the potential to transform rural economies, create thousands of jobs, reduce foreign exchange demand, and strengthen food security. Unlocking this potential requires a clear choice between continuous reliance on imported milk, which exposes the country to global price shocks and exchange-rate pressures, or be fully committed to backward integration while accepting upfront costs and complexities for long-term sustainability. For CODARAN and a growing number of stakeholders, the choice is obvious. ‘The time for half measures is over. Nigeria must decide whether it wants to produce what it consumes or import what others produce,” Abubakar said.
