Abstract:

Promoting local sourcing of raw materials for firms in Nigeria has become one of the critical areas of government policies. In achieving this, the government introduced a ban on the importation of grains/cereals, which are critical ingredients in feed production for feed mill industry. Hence, this study examines the extent (share) of locally sourced feed ingredients and its implications on the performance of feed mills in Southwest, Nigeria. Primary data used for this study was analysed using descriptive statistics and fractional probit regression. Firm’s age, quantity of feed produced and location of the feed mills significantly determined the share of locally sourced feed ingredients in feed production of feed mills in the region while level of education of feed mill operators, firm’s age, quantity of feed produced and proportion of locally sourced feed ingredients had significant effect on the performance (profitability) of feed mill entreprises in the area. It was therefore recommended that policies on improving infrastructure, production of feed ingredients, and addressing insecurity should be prioritized rather than promoting a ban on the importation of critical feed ingredients for feed mill industry in Nigeria.