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Poultry industry losing billions due to high costs: PPA

Poultry industry losing billions due to high costs: PPA

LAHORE: The poultry industry says farmers lost an average of Rs20 on a kilogram of broiler chicken during the last one year as the average price remained Rs117 per kg against the cost of production of around Rs135.

The situation, if persisted, would force nearly half of the farmers out of business, Pakistan Poultry Association (PPA) Chairman Rai Mansab Ali Kharal told a press conference on Tuesday.

“The poultry sector, which is the most organised branch of the agro-based sectors, contributes to 40 per cent of the country’s total meat consumption and employs around 1.8 million people,” he said. “It’s unfortunate that such an industry is in crisis.”

According to the Animal Husbandry Commissioner, the average ex-hatchery price of a day-old broiler chick was Rs24 against the cost of production of Rs31 in 2012.

By contrast, the average sale price of a day-old chick in July 2016 was only Rs5.5. “The industry yearly produces 1.25 billion chicks and the present cost of production is Rs35 per piece. Even if a chick sells for Rs24, the cumulative loss comes in at around Rs13.75bn,” he said.

The total loss mounts to around Rs43bn on sales of 1.25bn birds, with average weight of a bird being 1.75kg. “This loss will only rise because the cost is increasing while selling price is not,” Mr Kharal observed.

The PPA chairman asked the government to provide a relief package to the industry, including Rs20 per kg subsidy to every poultry farm and interest-free loans to poultry farmers.

Furthermore, 20pc drawback (export subsidy) and 25pc freight subsidy to the exporters of poultry products should be provided so that they could compete on the world market, he said.

The government should also withdraw sales tax and import duty on the import of soya bean meal and grandparent chicks.

“The government has nullified its own policy by imposing duty on imported raw material, putting additional burden of Rs10bn on the poultry industry,” he said, adding that the district governments should not intervene in setting prices of chicken and eggs.

Published in Dawn, August 3rd, 2016

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