Poultry sector seeks reduction in input costs to avoid closures

LAHORE: The poultry sector has asked the government to take serious measures to reduce the production cost of the sector, as it was incurring massive losses for the last couple of years mainly due to unprecedented hike in input costs.

Addressing a press conference at the Lahore Press Club on Saturday, Pakistan Poultry Association (PPA) Vice Chairman Ch Muhammad Fargham said that the farmers were suffering badly for the last two years, with most of them losing their entire working capital, and were at the verge of bankruptcy.

“If the farmers don’t get immediate relief in this regard, the county might witness the closure of up to 50pc poultry farms.”

He said the cost of poultry feed has gone up in Pakistan, reaching the highest level in the last 10 years owing to huge depreciation of Pakistani Rupee against the US Dollar, record-high markup rate and continuous increase in power and gas tariffs. He maintained that the outgoing year was one of the worst for the poultry industry.

“During the last few years, there has been a gradual increase in the input cost of poultry production, but in the last couple of years, the hike has gotten steeper. This recent escalation in input cost has rendered poultry business unprofitable in the country.”

He said that the industry was passing through one of its worst slumps and required urgent attention of the government so that the sector’s concerns were addressed.

“As poultry is a perishable commodity, a farmer finds it hard to transfer this hike to the consumer as the prices are determined on a supply-demand basis. This high cost of production is also the main detriment in the export of poultry products, as it makes local poultry non-competitive in the export market.”

Replying to a question regarding the existing trend of poultry rates, he said that poultry rates have not been increased at the same pace at which some other kitchen items had in the last 30 years.

“Poultry products have been resisting inflationary trends, as they never go up when other items register hikes in their rates due to high inflation.”

He maintained that the farmers’ community, including poultry farmers, were among the most oppressed and vulnerable groups of the country, as they cannot fix the rate of their products as per to their cost of production.

“They are totally dependent on market forces, as against the manufacturers and dealers, who have full authority to set the price of their goods based on cost of production and other duties,” he added.

He claimed that for most part of the year, chicken prices remained less than the cost of production. “Only for a few months in a year, a farmer gets premium which compensates his previous losses and that was how the year average price becomes viable for a farmer to continue his work.”

He said the biggest factor behind the increased cost of production was currency devaluation, as the cost of imported poultry medicines and vaccines in dollar terms had increased tremendously.