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Commodity Development Initiative: Livestock and Dairy

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Overview

As part of its developmental role, the Central Bank of Nigeria (CBN) in collaboration with key stakeholders in the livestock and dairy industry established the Livestock/Dairy Development Initiative in 2019 to address the nation's over-reliance on milk importation, conserve foreign exchange and create employment opportunities. The initiative is being implemented in partnership with major dairy investors to achieve a targeted 1,700,000MT milk production by 2024. For this purpose, the Bank will support dairy investors through the provision of low-cost funding and facilitate linkages with development partners/non-governmental organizations (NGOs) on capacity building and skill/technology transfer within the industry.

Objective of the Initiative

The core objectives of the Bank's Livestock/Dairy Development Initiative include:

  • Promote private investments in the industry;
  • Develop herds and improve breeds of cattle;
  • Increase dairy production and processing capacity of investors;
  • Reduce dairy products import bill;
  • Catalyze inclusive growth in the Nigerian dairy industry;
  • Organize smallholder dairy farmers into clusters to facilitate off-take arrangements and linkage to stakeholders in the value chain.

Frequently Asked Questions (FAQs)

Questions Answers
1 What is the Livestock/Dairy development initiative? An initiative by the CBN, focusing on Development of the Livestock/Dairy Value Chain towards promoting food security and employment generation.
2 When was it initiated? 2019
3 What is the major objective of the initiative? To address the nation's over-reliance on milk importation, conserve foreign exchange and create employment opportunities.
4 Who is the managing agent for the initiative? CBN is the managing agent for the funding interventions i.e. DCRR, CACS, AADS, ABP & AGSMEIS.
5 Who are the key players/stakeholders under the initiative? State Governments (Ranch Development), Livestock Farmers, Dairy Companies (Dairy and Derivatives), NGOs (Private Investors), PFIs (Funding partners), Research Institutes.
6 Who is an eligible participant under the programme? Any Company/Individual along the Value Chain that meets the requirements for funding under the aforementioned CBN intervention programmes.
7 What category of the value chain can be funded under the scheme? All aspects of the value chain can be funded.
8 What is the obligor limit under the programme? The obligor limits will be determined by the provisions of the guiding modalities for the interventions under the programme;
  • RSSF-DCRR-Maximum of N10Bn.
  • CACS-Maximum of N2Bn.
  • AADS-Dependent on what the obligor's collateral can accommodate.
  • ABP-Dependent on the Economics of Production (EoP) and number of hectares (land size).
  • AGSMEIS-Maximum of N3m.
9 What is the tenure of facilities under the programme? The tenure will be determined by the provisions of the guiding modalities for the interventions under the programme;
  • RSSF-DCRR-Minimum of 10 years.
  • CACS-Dependent on Gestation Period.
  • AADS-Maximum of 5 years.
  • ABP-Dependent on Gestation Period.
  • AGSMEIS-Maximum of 7 years.
10 What is the lending interest rate under the programme? 5% per annum all in, to revert to 9% by March 1, 2022.

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