Musgola Fish Farms to Double Production through Access to Finance
Nigeria’s annual fish production currently stands at 0.8 million metric tons per year, which is 2.7 million tons short of the local demand. To help increase domestic production and meet local demand for one of the country’s most consumed proteins, fish production firms like Musgola Farms Ltd need all the support they can get to improve their output, quality and capacity.
Since 2021, the USAID-funded Feed the Future Nigeria Agribusiness Investment Activity has provided technical support to Musgola Farms Ltd, a fish production firm based in Minna, Niger State, by helping them structure a business plan proposal to access $56,470 (24 million Naira) in finance through Sterling Bank’s Women and Youth in Agriculture Finance (SWAY-AGFin) product.
The firm received the payment in two disbursements of $28,235 (12 million Naira), each over a six-month moratorium period and with a standing agreement to keep receiving funds on a rolling basis. They received the first disbursement in October 2021, which they quickly paid back, and received another $28,235 (12 million Naira) in June 2022. With the funds from the first disbursement, the company turned over a profit of $9,827 (5 million Naira).
“We completed the first production cycle with the $28,235 (12 million Naira) we received, and we sold about $38,062 (17 million Naira) worth of fish,” said Umar Musa, CEO of Musgola Farms Ltd. He added that the firm will continue to access $28,235 (12 million Naira) or more on a rolling basis as they adhere to the repayment window per cycle over the next two years.
Highlighting how the funding helped his business increase its production capacity and produce more fish, Musa, who is also the founder and head of a fish cluster in Minna, said, “The money we received from Sterling Bank helped us to increase our fingerling stocking capacity from 100,000 per annum to 130,000.” He noted that the firm was also able to increase their fish feed production to provide feed, not just for his farm, but for the rest of his 300-member fish cluster which owns over 2,500 ponds, each with a stocking capacity of at least 5,000 fingerlings.
Musa expressed confidence that the firm will sustain their relationship with the bank in order to access more funding but noted that the firm needs more working capital to meet the growing demand for fish products, especially in nearby Abuja where demand for catfish products is high.
“Our cluster controls the fish market in Minna, but we want to acquire a market share in Abuja where we know demand is very high,” he said.
With an annual product shortage of 1.9 million metric tons of fish, much support is still needed to optimize production to cover this gap. The Feed the Future Nigeria Agribusiness Investment Activity will continue to support micro, small and medium enterprises (MSMEs) in the aquaculture value chain to enhance their performance and strengthen access to finance, enabling them to expand their businesses and optimize their growth.