June 6, 2024

 

High feed costs still an issue for Bangladesh's livestock, poultry farmers despite possible record corn harvest

 

A potential record corn harvest in Bangladesh has led to a decline in corn prices this year during the country's peak harvesting season, but small livestock, fisheries and poultry farms are seeing minimal benefit as feed costs remain high.

 

Farmers and seasonal traders in the northern and southwestern regions reported that corn is now selling at Tk24-28 (US$0.20-0.24) per kilogramme from farm level to mill gate , down from Tk32-38 per kilogramme two months ago.

 

However, the feed industry syndicate in Bangladesh is accused of maintaining inflated prices for processed feed products despite the 40% drop in corn prices.

 

Poultry feed, fish feed and dairy feed remain at Tk60-75 (US$0.51-0.64) and Tk58-65 (US$0.49-0.55) per kilogramme, respectively, according to Kamrul Huda Shantu, a farmer and trader at Parbatipur in Dinajpur.

 

Shantu said farmers are selling corn at Tk22-24 (US$0.19-0.20) per kilogramme; the price decreased by Tk10-12 (US$0.09-0.10) per kilogramme since the harvest began in the northern regions.

 

Agents from large feed companies are offering lower prices for corn, he added.

 

With the urgent need for money to begin Aman cultivation, farmers are forced to sell corn at a limited profit margin of 10-12%.

 

Mahmudul Hoque Shamim, a trader at Dimla in Nilphamari, said agents from Quality Feed, Paragon, ACI, Kazi and other companies are buying corn at Tk26-28 (US$0.22-0.24) per kilogramme.

 

Helal Uddin, a poultry farm owner in Dohar, Dhaka, told The Financial Express that feed prices remain at Tk75 (US$US$0.64) per kilogramme, while a single bird requires at least two kilogrammes of feed to reach maturity. This, combined with the high cost of day-old chicks, has pushed production costs above Tk195 (US$1.66) per kilogramme. Consequently, farm owners are barely making a profit of Tk4.0-6.0 (US$0.03-0.05) per kilogramme, according to Uddin.

 

He added that many farmers have been forced to close their businesses in the past two years due to the high input costs.

 

Suman Hawlader, president of the Bangladesh Poultry Association, said six to seven major poultry companies dominate the feed, day-old chicks and egg markets.

 

According to Hawlader, these corporates offer day-old chicks and feed at much lower rates, but only to their contract farmers.

 

"The rest of the 50,000 small and medium-scale farmers struggle to survive as they are forced to buy these products at much higher prices," he said.

 

Hawlader also alleged that the feed mill syndicate has taken over the corn market during this harvest season. These companies, along with their allied traders, are manipulating prices as most farmers do not have storage capacity to hold onto their crops for extended periods.

 

Md Jahid Hossain, supply chain head of Nahar Poultry Ltd, said that while villages trade moist corn at Tk 24-28 (US$0.20-0.24) per kilogramme, companies require dry corn, which they purchase at Tk32 (US$0.27) per kilogramme. Prices were previously higher, at Tk36-38 per kilogramme before the harvest began.

 

Hossain said another feed ingredient, soya cake, is still costlier, as it remains at Tk65-68 (US$0.55-0.58) per kilogramme. Companies may reduce feed prices within a few weeks if the corn market stabilises.

 

According to the Feed Industries Association of Bangladesh (FIAB), the country's annual demand for animal feed is nearly 6.5 million tonnes. Local feed millers now produce nearly 99% of this total demand.

 

Bangladesh's agriculture ministry forecasted a yield of 5.8 million tonnes of corn this year, following a record-breaking harvest of 4.6 million tonnes last year.

- The Financial Express