Poultry pricing

By Mansoor Ahmad
May 25, 2022

LAHORE: After growing at an average of 10 percent in the last 50 years, poultry growth posted negative growth in the past five years mainly because of flawed government policies. High poultry rates are because of these policies.

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Poultry farmers regretted that inputs not produced in Pakistan have been slapped with duties and sales tax that has resulted in sharp increase in rates depriving the poor of the cheapest source of animal protein.

Former chairman Pakistan Poultry Association Abdul Basit said that poultry was the cheapest source of animal protein not only in Pakistan, but the world over.

He said the average daily animal protein consumption in Pakistan was only 15 grams per capita, while the average minimum requirement was 27 grams.

There is a dire need to increase poultry production in the country that has largely grown without helpful government policies or facilitation.

Farmers expect corrections in duties and taxes to put the industry back on a growth path.

They want abolition of duty and sales tax on the import of soybean meal, which is not produced in the country.

Dr Mustafa Kamal Pasha, a poultry expert said soybean meal was an important part of poultry feed that was rich in protein. Poultry feed accounts for 65 percent cost of production of a one-day old chick to its maturity.

He said 17 percent sales tax on duty paid value of soybean meals has increased the cost of poultry feed by 25 percent. An alternate food ingredient was maize.

He regretted that the government has allowed its export as there was a global shortage of maize due to the war in Ukraine.

Dr Pasha said that this has resulted in sharp increase in prices of maize as well.

Basit said the state has also slapped duties and sales tax on poultry vaccines. Since poultry birds are vulnerable to numerous diseases, they need these vaccines to survive. He wondered how it was possible to tax vaccines needed by animals.

This results in an increase in the cost of production of poultry. Without vaccination the fatality rate of poultry would jump to 50 percent.

High-power cost was another issue, he said, adding that poultry farms housing hundred thousand birds or above were in rural areas.

These birds have to be reared in controlled sheds and need regular water sprinkled aeration to keep the sheds cool.

Fans and sprinklers operate 24/7 before dispatching the birds to the market. Power outages in rural areas last for hours. He said a power suspension of five minutes results in the death of the entire stock.

Basit said breeders ensure 24/7 power through diesel operated generators that cost Rs50 per unit. Poultry farms should be provided power at tube-well rates.

Most of the poultry birds in the country get slaughtered at the chicken meat shops. After slaughtering, the bird gets thrown in a filthy drum, which rarely gets cleaned and remains in constant use.

The germs inside pollute the healthy bird and also get into meat through the handlers’ hand.

This polluted meat remains tax free. The five percent poultry that is processed gets slapped with 17 percent sales tax. Instead of encouraging processed poultry we are ensuring that processors close the shop.

A chicken meat processor said that the processing industry has a potential to increase halal meat exports to levels higher than that of textiles.

He said the processors do not want any concessions, but a surety that the exports would be zero-rated.

He said the Federal Board of Revenue should sit with chicken product processors to arrive at the rebate on exports based on the duties paid at various stages. Till then, the government should allow 20 percent rebate on exports of processed chicken, and there would be no shortage of foreign exchange after one year.

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