December 20, 2024

 

Opportunities and challenges for Indonesia's native chicken sector

 

In a country known for its vibrant poultry sector, Indonesia's native chicken industry stands at a crossroads.

 

While growth opportunities abound, the sector grapples with regulatory hurdles, market competition, and outdated practices. Yet, with targeted support and modernisation, native chickens could become a cornerstone of Indonesia's food security and rural economy.

 

Ade Zulkarnain, chairman of the Indonesian native poultry farmers association (Himpuli), said the native chicken sector has changed over the past years. The association initiated the concept of industrialisation to make the native chicken sector more attractive. "Since 2012, we have directed this sector to grow. We improved all aspects, such as genetics, houses, feed, health, and management," he said.

 

Innovation in breeding has played a pivotal role. KUB chickens, prized for their superior egg production, now serve as the female line, while the robust Sentul chickens are used as the male line. These genetic advancements are coupled with a shift towards modern housing, replacing backyard systems with closed, climate-controlled facilities.

 

The chickens have also met their nutritional needs with good feeding. The same goes for health, specifically, with the provision of vitamins, medicines, and vaccinations.

 

Zulkarnain explained that removing native chickens from Indonesia's ‘negative' investment list in 2020 was a game-changer. Previously restricted to investments under US$10 billion, the sector is now open to large-scale investors. Broiler companies have already started to take notice, as they invest in modern breeding facilities to tap into this emerging market.

 

However, he cautioned that industrialisation alone is not enough. Most native chicken producers are small-scale farmers relying on traditional methods, making it essential to align policies with their needs. Clear market segmentation between breeders and commercial farmers is crucial to avoid the pitfalls experienced in the broiler industry.

 

Despite progress, significant challenges remain. Chief among them is the lack of accurate production data. Government estimates place Indonesia's native chicken production at 12% of the national poultry output, while Himpuli's data suggests a mere 6%. This discrepancy hampers effective policymaking and resource allocation.

 

Market competition also poses a threat. Male layer chickens, often passed off as native chickens, are sold at premium prices, misleading consumers and undercutting producers. "The price of native chickens is US$2.69 per kilogramme, while male layers cost only US$1.92. This unfair competition hurts both consumers and farmers," said Zulkarnain.

 

The native chicken sector is uniquely positioned to complement Indonesia's broiler-dominated poultry market. While broilers account for 70% of national production, the industry heavily relies on imported grandparent stock (GP). This dependency makes it vulnerable to global disruptions like disease outbreaks or political embargoes.

 

"If an (avian influenza) outbreak or economic crisis disrupts broiler imports, Indonesia needs a backup. Native chickens can fill that gap," Zulkarnain noted. While the government-approved blueprint is not yet available, Himpuli continues to encourage poultry companies to participate in developing and industrialising the sector.

 

As the number of broiler producers continues to shrink due to consolidation, large producers and integrators are displacing independent farmers.

 

"Independent farmers are experts in poultry farming. The native chicken sector is an option for them to venture into with their expertise," Zulkarnain said, adding many broiler farmers have already made the switch.

 

- Meliyana, EFL AG-DATA