July 19, 2010

El Nino and smuggling hound Philippine poultry subsector's growth

Philippine poultry raisers said the subsector will not achieve a 20% increase in broiler production this year, due to the El Nino weather phenomenon and the importation and smuggling of cheaper alternatives to local chicken.

The United Broiler Raisers Association (Ubra) said the industry could only manage to raise broiler supply by 4.4% to 549.1 million kilogrammes this year.

Ubra president Gregorio San Diego said the poultry sector is confronting a number of difficulties this year, noting that the El Niño is causing broilers to become smaller and weigh less. He also said farmers are losing money because they have to sell below production cost.

In April, poultry raisers spent PHP68.30 to produce a kilogramme of broiler, but farm gate prices averaged PHP66.13 per kilogramme that month. In March, poultry raisers suffered bigger losses as farm gate prices averaged PHP67.76 per kilogramme with the cost of production pegged at almost PHP75 per kilogramme.

"Farm gate prices have been fluctuating. One day, the price may be favourable and then the next day, you will lose money," San Diego said.

From January to April this year, the group cited that private traders have imported as much as 28.8 million kilogrammes of imported chicken meat, or 123.27% more than the volume shipped into the country a year earlier.

San Diego expressed concerns about chicken leg quarters from North America, noting that the landed cost of chicken leg quarters are only about PHP60 per kilogramme. Last year, the Philippines imported 67.26 million kilos of chicken meat; or almost 47% higher than the volume in 2008.

He said local production displaced by the importation last year totalled 59 million broilers. Total sales lost from imported chicken meat, including those of allied industries, amounted to about PHP8.34 billion.

The poultry subsector grossed PHP144.3 billion at current prices in 2009. Bureau of Agricultural Statistics said this was almost 10% higher than the previous year's record.