September 29, 2004

 

 

Philippines Chicken Raisers Concerned As Poultry Prices Continue To Fall

 

Local poultry raisers on Tuesday warned that if the Philippine government is not able to control the continuing drop in the price of chicken, specifically at the farmgate level, several of them will be forced to disengage in chicken production which will lead to a shortage in supply of poultry products.

 

Gregorio San Diego, chairman of the United Broilers' Raisers Association (UBRA), noted that in the past three weeks, the farmgate price of liveweight chicken has already dropped to P54 a kilo. "The decline in prices has been continuing and we even foresee that it may reach below the P40 per kilo level before the end of this month," he said.

 

At the same time, he appealed to retailers not to overprice their products in the market. "Given the farmgate price of chicken, they [retailers] should only add around P35; that total of P85 should already be their selling price. If so, they will already profit together with the middlemen," he said.

 

San Diego also urged the Department of Agriculture not to import additional chicken, asking the government to instead focus its efforts on retail prices.

 

He expressed alarm that traders have been continuously engaging in chicken importation. Last June, the country reportedly imported 940,182 kilos of chicken. The following month, around 2.5 million kilos of imported chicken arrived in the Philippines. Last August, around 3.4 million kilos of imported chicken gained entry in the country.

 

Even if 23 million kilos of chicken have been allocated under the country's minimum access volume for the year, San Diego said this volume should be evenly distributed over the 12-month period, so that his group will be able to compete fairly in the market.

 

"Farmgate prices always reflect market forces. Even as farmgate prices decline, retail prices continue to be high. The imports will hurt producers' prices and may not necessarily result in lower prices of chicken for our consumers," he added.

 

Ubra also complained of the high prices of feeds, which it claimed to be one of the factors contributing to the sector's production losses.

 

In 2002 the poultry industry suffered from severe oversupply, which resulted in depressed prices of chicken and chicken products.

 

It was the reverse in the last quarter of last year, when chicken prices in the local market shot up in light of the tight supply, notably during the holiday season.

 

San Diego admitted that the broiler industry failed to anticipate the big increase in demand. "The supply problem was compounded by the big reduction in volume of imported chicken and chicken parts. The prevailing high world market price of chicken prevented the entry of imported chicken especially during the last quarter of 2003," he explained.

 

On the other hand, the Bureau of Animal Industry assured that the chicken shortage experienced last year is unlikely to happen again due to stable prices of meat and chicken as monitored for the past weeks.

 

The DA's price monitoring team reported that prime agricultural products are enjoying general price stability, with prices of chicken going down from P100 to P95 per kg.

 

DA officials said the stable prices were caused by lower demand coupled with abundant supply. This comes as the meat and chicken inventories of San Miguel Corp. and Swift Foods Inc. are unloaded in preparation for the holidays and the arrival of voluminous produce from the Mindanao region.