July 21, 2008


Sri Lankan poultry industry faces a crisis  


The Sri Lankan government's delay in increasing the maximum selling price of chicken has thrown the poultry industry into crisis due to impending shortage of chicken.


The Consumer Affairs Authority (CAA) fixed the maximum selling price at US$2.60 per kilogramme in February 2008 despite chicken producers spending US$2.93 per kilogramme. Although it recently raised maximum retail price to US$2.98 per kilogramme, it still fell short of poultry producers' request of US$3.26.


Poultry producers warn that this will cause shortage of chicken for at least for six weeks due to the sudden stoppage of production.


The price restriction has forced 27 percent of the country's small-scale farms to stop buying two-day old chicks from hatcheries to rear them to six weeks, due to low prices from buyers. Large-scale farms have also reduced chicken production to 50 percent.


Producers could not cope with the high prices of chicken feed, which has increased by 49.9 percent from last year, said Managing Director of Bairaha Farms Limited Yakooth Naleem. Furthermore, electricity and labour costs have increased.


The poultry industry in Sri Lanka has been on the decline since 2005. Around one million people depend on the industry and the government collects US$27.9 million of taxes annually from large and small scale producers, said Mr. Naleem.

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