Rising chicken prices playing havoc with consumers

Over the decades, poultry meat has been considered an easy and relatively cheap method of raising dietary standards of the people as it is the only reasonably priced meat after beef, mutton, fish and sometimes more reasonable than pulses and vegetables. Due to high prices of fish, beef and mutton, chicken meat has been considered as the only viable option for poor families.
It has been dubbed as the ‘poor man’s luxury’ due to its affordability. But the situation has changed altogether and chicken is no longer an affordable commodity for the poor. The newly introduced RGST regime has changed realities. Following the imposition of RGST on poultry feed in the annual budget 2011-12, the price of chicken meat has shot up to Rs250 per kg from earlier Rs180-200/kg range. Similarly, per dozen price of eggs has risen to Rs85 from Rs52, which shows the highest degree of food inflation. A meteoric surge in red meat prices is a lateral cause of upward trend in the poultry industry. Consequently, the declining per capita consumption of meat in Pakistan will further witness a plunge, bringing adverse impact on public health and physical strength of the working classes.

Risings costs

Market analysts are anticipating that a large number of farms are likely to close due to high cost of production, rendering hundreds of workers jobless. It is because the production cost of chicken meat and eggs involves a 70-80 per cent share of poultry feed in total poultry business investment. Poultry farmers consider the current disequilibrium as unbearable in terms of cost and see it as sheer injustice. Poultry feed, by its quality and price, is the major factor in determining the cost of poultry products like eggs and broilers and profitability of the poultry farm. It is considered as a building block of the poultry industry. Poultry contributes 40 per cent of the total meat consumption of the country and generates employment and income for about 1.5 million people. It is the cheapest available meat protein source for the masses that is acting as an effective check upon spiraling animal protein prices.
The poultry industry has made great strides in the last few decades in Pakistan and has increased at the rate of 20 to 25 per cent per annum. At present, there are more than 25,000 poultry farms in the country with an investment capital of more than Rs1000 billion. Modern poultry farming plays an important role in fulfilling the nutritional needs of the country as an easy and relatively cheap method of raising the dietary standards of the people. The shortage of animal protein in Pakistan has been estimated at about 2 million tonnes taking into account the population of 180 million. The daily average consumption of animal protein is about 17 grams as against the recommended daily requirements of 28 grams. This deficiency can be met with the increase of production of poultry meat at a reasonable cost. Poultry industry has been catering all local needs by producing 10 billion eggs and 10 million tones of chicken meat annually. The proof of Pakistan’s self-reliance in poultry sector is that the country has never imported eggs or chicken from any other country since its creation.

Poultry: an ideal diet

The ability of poultry to adapt to most areas of the world, low economic value per unit, rapid growth rate of poultry and the fast generation time; all make poultry an ideal starting point for beginning animal agriculture and a rich source of animal proteins for human food. A poultry enterprise can be producing meat in eight weeks, and eggs in 24 weeks, it has been estimated that chicken appears in the diet of more people throughout the world as a source of meat than that of any other animal. Poultry meat carries an advantage over red meat (beef and mutton) in having less percentage of fat than either beef or mutton, and is therefore, termed as non-fattening and a good dietary source for the prevention of hardening of cardiac arteries – a common ailment. Chicken meat is a rich source of nutrients and is easily and completely digested. It is also a good source of protein and vitamins. The growth promoting value of the protein in chicken compares favourably with that of fish protein.
With growing children on mainly meat diets, any response in weight gain or hemoglobin is greater with meat than with milk. Poultry meat is economical, quick and easy to prepare and has a number of desirable nutritional and organic properties. The meat is tender, easy to chew or grind, easy to digest and the flavour is mild and blends well with seasoning and other foods.

Imposition of RGST: customers’ misery

Keeping in view the significant share of poultry in the national food requirements, imposition of RGST on poultry feeds translates into an imposition of taxes on eggs and chicken meat. At the pre-imposition stage of RGST, poultry farmers pledged their support for consumer rights, demanding authorities to withdraw the tax. Once it was imposed, the voiceless consumers and the organised stake holders had to decide whom will the RGST be paid by. The poultry farmers say that the sale price of poultry products depends on the demand and supply mechanism instead of production cost. Therefore, they were protesting that it is not possible for poultry industrialists to shift the burden of RGST on their consumers. They argued that chicken meat and eggs were the final products of poultry farms so the RGST could not be shifted on consumers. But all these assumptions by the poultry industrialists were contradicted soon after the imposition of RGST. The very next day after the announcement of budget, the RGST was directly laden on the helpless consumers giving a wind fall to the poultry investors who are enjoying increased revenue from their daily sales. Although their sale quantity has declined due to the price increase, yet their net profits have increased due to high pricing.
The most deplorable aspect of the consumers’ dilemma was that the authorities remained invisible in the whole episode. The government, engaged in serious political and security issues, is least bothered to take notice of the arbitrary price hike by the market forces on the demand and supply gap artificially created by the greedy investors. An unholy alliance between the poultry farmers results in a deliberate under-flocking (a business tactic of breeding less than national demand to trigger up the price) at the poultry sheds. If the poultry farmers are given a free hand to create a demand-supply graph slanted in their favour through unethical practice of under-flocking, meat prices might cross Rs500 per kg. And this is not the only source of worry for consumers. A large number of poultry shopkeepers continue to fool consumers by claiming that they were selling meat at wholesale rates, when they actually dip the bird in the water for a few minutes after slaughtering, which enhances the meat weight by 60-70 grams per kg. Under-weighing by tampering the scales is the most common way of cheating by poultry sellers. Organ meat, popularly known as pota and kaleji, is also sold at the regular price of chicken meat. The most embezzling part of chicken sale is that the customers are receiving 800 grams of chicken meat whereas they are paying for 1 kg (1000 grams). This is because chicken meat is weighed before cutting and cleaning, a process in which 200 grams are removed out in the form of dirty fats.
A lot of malpractices in the poultry trade can be easily tackled if we introduce value-addition in the poultry industry. We are still unable to promote the idea of frozen meat in society. Once steps are taken in that direction, a mechanism of quality control will come into play and the plunder of street sellers will come to an end. International fast food chains operating in Pakistan, KFC and McDonalds must come forward to popularise the value addition. An added benefit of the introduction of frozen meat is that the price of chicken will surely be stabilised and the system of daily price change will be ruled out.