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Many poultry farms close on rising costs

News Desk
  18 Feb 2023, 11:43

Enamul Haque Panna opened a poultry farm in Kushtia’s Daulatpur four years ago with 1,600 broiler chickens in two sheds.

 

The good news for farmers is that chicken and egg prices have shot up over the past month.

But it came too late for Enamul. Due to losses totalling around Tk 300,000, he closed the farm one and a half months ago.

 

“Although the broiler chicken price has increased, it was quite low a while ago. The losses were relentless and I  couldn’t go on,” he said.

 

Small farmers accuse corporate firms of raising chick prices unreasonably.

 

Enamul blamed rising prices and falling quality of feed for the losses. “Whenever I bought feed, the price increased by at least Tk 200 per sack from the previous rate. And if the quality is low, chickens don’t grow much.”

 

Faridul Haque Mintu, another poultry farmer in the area, however, has managed to stay afloat. Just.

 

The price of broiler chicken in Dhaka has shot up by nearly Tk 90 to 230 per kilogram in less than a month, adding to the cost-of-living crisis of people with a limited income.

 

Sultan Ahmed, a worker on the muster roll of a government agency, came to Karwan Bazar in Dhaka on Friday to buy a pair of 2 kg broiler chickens, which would cost him Tk 320 apiece a month ago. 

 

He returned home with only one 2 kg chicken by paying Tk 460.

 

“It’s like everyone is being held hostage. I bought chicken because my children like meat on the table at weekends. I haven’t seen chicken prices rise so high in many years,” Sultan said. 

 

Still, farmer Faridul in Kushtia said he would count losses.

 

“It will take Tk 250 in total to raise a chick to 1.5 kg after buying it at Tk 53,” he said.

 

Egg prices have also increased by Tk 20 to 140 a dozen in this period.

 

Shahabuddin, an egg trader in Dhaka’s Karwan Bazar, blamed a supply crunch for the price hike.

 

“Prices are rising because many small farmers have stopped producing eggs. Many farms have closed. Only the big businesses who do not have a problem with losses of millions of taka are still in business,” he said.

 

A hike in feed prices caused losses to many poultry farmers, forcing them to shut business.  

 

FEED, CHICK PRICES

 

Sumon Howlader, president of Bangladesh Poultry Association, said at a press conference earlier in February that the number of poultry farms in the country fell to 60,000 from 160,000 in 2009.

 

The association largely blamed a rise in feed and chick prices for the closure of the farms.

 

The marginal farmers hold 90 percent of the chicken and egg industry while the corporate farms control the rest, according to him.

 

“Still, the corporate farms control the entire market because they hold 100 percent of the feed and chicks market.”

 

Experts say calculation shows the production cost of a chick can be a maximum of Tk 35.

 

Shahidur Rahman, chairman of Bangladesh Agricultural University’s poultry science department, thinks chick prices should not exceed Tk 35 if the companies profit reasonably.

 

Shakila Faruque, chief scientific officer of poultry research at Bangladesh Livestock Research Institute, said their calculation shows the production cost of a chick can be a maximum of Tk 35.

 

However, the actual price was Tk 15 on Jan 19, and it shot up to Tk 60 in February.

 

The number of poultry farms in the country fell to 60,000 from 160,000 in 2009, according to the Bangladesh Poultry Association.

 

Shahidur believes the companies make an extra profit whenever they can to cover losses.

 

Even two years ago, Enamul’s farm was thriving in Kushtia before eventually shutting down. Feed prices were lower and would incur profit even after buying chicks at a higher cost.

 

“The prices of feed were TK 500-600 lower then. But now feed, medicines, labour – everything costs more. The companies have their hold on everything.”

 

Poulterers’ leader Sumon has the same view. “Companies that produce chicks and feed have us in their hands. About 10 to 12 companies are leading the whole thing. Among these are Kazi Feed, Paragon, Nahar, BPIC and others, but all companies are keen to take advantage.”

 

Several poultrymen from Savar, Rajshahi’s Bagha and Rangpur said 50 kg sack of poultry feed used to cost Tk 2,400-2,500 in mid-2021. It went up to Tk 2,700-2,800 midway through last year before leaping to Tk 3,380-3,420 later in December. It was around Tk 3,550 until February; the latest price is Tk 3,650 per sack.

 

According to a poultry farmer in Savar, it takes 300 kg of feed to make every 100 chickens sellable. The farmers had to count Tk 7 more for each chicken in a month and a half. A Tk 100 hike since Feb 10 pushed the expenditure by another Tk 6.

 

Monwar Hossain, a poulterer of Bagha, said medicine prices have doubled.

 

WHAT THE FEED FIRMS SAY

 

Mohammad Nazrul Islam, general secretary of the Feed Industries Association of Bangladesh, said they had repeatedly mentioned an up to 70 percent rise in raw materials for the hike in feed prices.

 

“Dollar rose by 27 percent, and we are a country that depends on imports. You may have seen flour, corn, and other agricultural products are costlier now. There will be a crisis when imports halt.”

 

The associate vice president at ACI Godrej Agrovet Private Limited, Nazrul, alleged many poultry industry leaders speak about feed price rises despite not being involved in farming.

 

Broiler chicken is one of the main sources of protein for people with a limited income.

 

 “People want to buy eggs at Tk 10 each. That’s unfair. You can’t ask for prices lower than the production cost. Everything else in the country costs more, but everyone loses their mind when the prices of chicken and eggs go up.”

 

“How much did feed cost when chicks were under Tk 10 each? No one said a thing then. We sold at a loss. We are facing losses even after selling at higher prices now. No one is having it easy.”

 

“You can find out there are 200 registered feed mills in the country. How many of them are running now? All companies would’ve stayed open if the business had been profitable. Only 60-70 mills are available now.

 

MINISTRY SEEKS TO CALM PRICES THROUGH DISCUSSION

 

Fisheries and Livestock Secretary Nahid Rashid said the government was aware of the issues in the poultry industry.

 

“The prices of feed and chicks have gone up, and the chicken trade is not reaching breakeven.

 

A hike in feed prices caused losses to many poultry farmers, forcing them to shut business.  

A hike in feed prices caused losses to many poultry farmers, forcing them to shut business.

“This isn’t a new issue. The key problem lies in higher feed prices, which impacts other areas.”

 

She said the government was regularly speaking to the stakeholders, who would eventually devise a solution. 

 

“We’re trying, but there cannot be a solution overnight.”

 

The secretary said the government revised a draft to update the guidelines for the poultry industry.

 

She hopes the revised guidelines will help settle the issues in the sector.

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