Poultry Industry

Published: August 11, 2011 Poultry in Pakistan has long been considered as a backyard business for household needs. The need for commercial poultry rose in early sixties and took the form of a national campaign to enhance and increase the production of feed products in the country. Under this campaign the government announced a tax exemption policy on the income derived from poultry farming. Pakistan International Airlines (PIA) in collaboration with Shaver Poultry Breeding Farms of Canada started first commercial hatchery in Karachi. Simultaneously, a commercial poultry feed mill was started by Lever Brothers (Pvt), Pakistan Ltd., at Rahim Yar Khan, which was followed by other pioneers like Arbor Acres Ltd. Before 1963 the native breed often termed as Desi was raised which produced a maximum of 73 eggs per year under local conditions. Another breed known as Lyallpur Silver Black which was an improved version of Desi was introduced in 1965-66 in the department of Poultry Husbandry, University of Agriculture, Faisalabad. The layers of this breed can produce 150 eggs per year and have the tendency to gain 1.4 kg weight in 12 weeks of age under favorable management and feeding conditions. The poultry sector of Pakistan was relatively immature and under organized more than a decade ago. However, Feed milling has seen tremendous improvement in recent years. The plants which are in the process of establishment comply with the international standards. The infrastructure has spruced up so much so that a common man cannot differentiate between a pharmaceutical plant/chemical company and a feed mill. This signifies how much investment has been made in order to bring about the much needed change in the industry. Farming level has also seen its share of improvement. Times have changed and so have old habits of having a side business of poultry which was run by a person belonging to some other field for the sake of earning some extra money. Such poultry farms consisted of a shed containing 200 to 500 chicks. This concept has changed a great deal owing to stiff competition in the poultry sector. Moreover, starting a poultry business is not as easy as it was in olden times. It calls for heavy investments to operate and compete in the market. This is the very reason investors are investing huge amounts of money and time in this sector and the modern sheds (control houses) being set up in Pakistan are no less than those in technologically

advanced countries. GRAINS have also improved to a great extent. However the supply of grains is not as developed as feed milling and farming. Production of quality feeds Feed is a major expense in poultry production which amounts to about 60 to 70 per cent of the total cost. Hence the most important factor in poultry production is the ratio between the feed and egg/meat. A newly hatched chick can survive for up to two days on the yolk ingested from the egg, but it needs to be fed as soon as possible with good quality feed, containing essential nutrients to meet adequately the option requirements for growth, egg production, egg quality and general body health. Different feeds give different results in terms of growth and egg production. A broiler chick grown to 9 weeks of age may require 3.0 lbs. of feed per pound gain, but another feed may require 3.5 kg under identical conditions. TECHNOLOGY The poultry sector deploys modern methods and technology in the areas of poultry breeding and mass production techniques. The bio-security measures adopted for breeding flocks are similar to surgical operating rooms. Proper techniques are employed in bird housing such as evaporative cooling and humidity control mechanisms. The hatchery operations use large incubators to mass produce broiler as well as layer chicks using sophisticated electronic systems. The disease control measures include vaccination against viral diseases of various origins along with latest diagnostic tools in veterinary medical services. Due to these technologies and vaccination now poultry production is a stable business without the fear of heavy losses due to disease and weather. PRODUCTION CONSTRAINTS: Broiler farming is mainly based on traditional methods. Average broiler performance value includes 1.75kg live weight at 42 days at feed conversion rate of 2.25. Layer farming is also based on traditional methods. These both sectors need improvement in housing and management practices and must practice modern technology as adopted in Broiler Breeder farms to make more profitable business. MARKETING: In Pakistan poultry products are sold through Vet markets in cities and villages. Birds are bought alive by the consumer and slaughtered and dressed

by the retailer. Only a small percentage of commercial broilers are commercially processed, mainly for hotels. Rural areas are generally deprived of poultry meat because of expensive distribution and also due to high mortality rate of broilers subject to prolonged transport time especially in hot conditions. Broilers and eggs are produced in the farms, which are generally close to the urban areas and conveyed by dealers to wholesale markets in major cities. An Additional layer of dealers purchase and distribute eggs and alive broilers to shopkeepers to cities and adjoining areas. The sales chain involving middlemen, wholesale markets and dealers is working for distribution of chicken and eggs, and getting approximately 10% of the retail price. Competition: There is fierce competition in the poultry sector. They say if a person can handle the credit of poultry business then he is capable of handling any other business. Though risky, yet poultry business can yield high profits. But this business has seen very high losses as well due to high risk factor owing to lack of an insurance system of animals and chickens. Adamjee insurance started livestock insurance in Pakistan recently but failed instantly as the system is still under developed. Concentration of Industry: Punjab is the hub of poultry business in Pakistan because of high population and is quite synonymous with the food business. The more the people, more is the consumption of food. The poultry industry in Punjab is well developed and availability of grain in Punjab is satisfactory. Other areas include Sindh and Karachi. No statistics are available as it has been the least developed of all industries. According to a rough estimate, however, there are 25 to 30 feed mills which are operating on national level and are following the international standards of infrastructure. Pre-requisites Land is the foremost requirement. Size of land depends on the scale of business. A separate space is required for machineries and storage (godowns). In soft infrastructure, an efficient team along with sales and promotion personnel and proper accounting systems are mandatory. Number of employees depends on the automation of the plant. Fully automated plants require at most 10 people. These plants are of international standards. Other than plant handling, additional people are required for loading and unloading the raw materials and finished products. Again, the number of the people

depends on the scale of the business. Since the feed mills and other plants in Pakistan are not 100% automated, they require 60-80 employees at least. The fully automated plants are now worth millions of dollars. On the other hand the monthly expenses in this industry vary surprisingly every month; it also depends on the performance of a company. Today if a person wants to invest in the poultry business, a huge initial investment is required for the establishment of infrastructure. Types of poultry include chicken, turkey, ducks and geese. Poultry is raised for meat and eggs. The poultry industry has flourished in the last few decades in Pakistan and has increased at the rate of 20 to 25 per cent per annum. At present there are about more than 10,000 poultry farms in the country which is a huge figure. PRESENT SCENARIO: Pakistans poultry sector entered the new millennium with adverse market conditions. The sector faced problems of over production and drastic reduction in prices of Day Old Chicks and Broilers. This price slump brought prices down to a record low level. The government ban on service of food in marriage parties has been lifted after a gap of 6 years, which is an encouraging sign and the results are going to be highly favorable. The poultry industry which suffered an unprecedented price slump and financial loss is on the road to recovery now. Poultry meat consumption is mostly urban based which accounts for 35% of people out of countrys 140 million population. Furthermore, it is income related e.g. according to one survey a 1% increase in income is associated with 2% increase in per capita consumption of eggs. According to the same survey 1% increase in income is associated with 2.2% increase in chicken consumption. As we all know the present per capita income in Pakistan is very low, so is the consumption of poultry products. FUTURE PROSPECTS: The population of Pakistan is growing at a rapid pace. The nutritional status of population is way below the standards of developed countries. Our meat resources like buffaloes, cows, goats and sheep are depleting. Mutton prices have been ever rising and have gone up to Rs. 150/kg which will boost up chicken consumption. Beef / mutton produced from animals of different age groups and health status is inferior to poultry meat, which is produced from broilers of uniform quality and of international standards.

A continuous supply of poultry meat and chicken, with population of 140 million and with currently low consumption of poultry, there is obvious potential for expansion in Pakistan. Impediments to increasing production include low profit margin due to high cost of production. Cost of energy in Pakistan is very high. To reduce farmers cost and help ensure low food prices for consumer, Government should withdraw 15% sales tax on electricity and treat Poultry Industry at power with other industrial consumers. At present there is an obvious discrepancy. The poultry industry has to pay 10% of the commercial charges while others have to pay 1-3% depending on sanctioned load.