October 11, 2010

Sri Lanka to import chicken and eggs during festive seasons

The Sri Lankan government is to import chicken and eggs during the traditional festive seasons in November-December and the traditional New Year in April, according to a Cabinet decision.

Demand for chicken and eggs go up sharply, by between 40-60% during these months, according to a Cabinet statement released on Thursday (Oct 7).

Chicken, eggs, day-old chicks and layer chicks will be imported during these months by the government National Livestock Development Board and the Lak Sathosa state retail outlet.

Loans will be given through state banks for breeding farms and small farmers, the Cabinet report said.  The import programme is to be reviewed monthly.

Sri Lanka imposed price controls on chicken and also pushed up import duties on corn to 'protect' grain farmers raising the price of feed, driving many chicken farmers out of business last year.

The state has increased intervention in prices, a situation not seen widely since the close economy days of the 1970s.

While trade liberalisation benefits consumers and forces poultry farmers to be more efficient, high maize prices hurts the competitive edge of local chicken farmers. Artificially high grain prices drive protein prices up by a multiple.

Sri Lanka has also seen steep rises in fish prices, which is a close substitute protein to chicken. Earlier in the year, self-service retail outlets where price controls were strictly imposed ran out of chicken as a real 'shortage' occurred.