With the growing middle class in Nigeria who are sensitive about their nutrition, yogurt is one of the dairy products that are high in demand. However, Yoghurt production is a neglected area, but statistics show that 98 percent of Nigeria’s dairy needs, including milk, are imported into Nigeria.
According to operators in the dairy industry, the nation grapples with about $1.3 billion import bill for dairy products for a population of over 170 million people. This shows the huge opportunity in the sub-sector for potential investors. With strong population growth, particularly amongst children and young people, consumption of milk products has been on the increase in recent years.
Yoghurt continues to be one of the more dynamic categories in packaged food; in trendy and flavoured formats that is widely available. Some companies have invested in the processing of milk into several products such as; ice cream, ghee, powdered milk and yoghurt, among others.
With dollar scarcity and roadblocks to importation in the country, yoghurt production is a sure bet. Yoghurt is a healthy source of milk. It has the capacity to produce a low-sugar brand for the aged and diabetic as well as; a moderately sugar type for other classes is an advantage.
Producing yoghurt commercially could cost between N2 million and N10 million, depending on the type of equipment used and their sources.
The major raw materials used to make yoghurt include: Milk, milk powder, stabilisers, sugar, flavour, colour, among others. Also, Yoghurt production requires major machinery. These include; motorised stainless steel mixer, incubator, pasteuriser, filling machine, UV Lamp, transfer pumps, PH Meter, shrink wrapper and weighing machine.
Some of the machines are imported into the country. Many of them are fabricated locally by the Federal Institute of Industrial Research Oshodi in Lagos; or Projects Development Institute Enugu (PRODA). Local fabricators can also help.
According to FIIRO, return on investment is 46.1 percent, while return on equity can go as high as 115 percent. Payback period is 34 months and 19 days, while break-even point is 51.8 percent.
Credit: BusinessDay (Josephine Okojie)
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