- The poultry industry consists of three separate sectors: (i) The day-old chick supply industry (ii) The broiler industry, and (iii) The egg industry.
- Broiler chickens are raised for meat i.e. fresh, frozen or value added (e.g. chicken fingers, saucy steaklets or polony). Egg layers or dual-purpose chickens are used for the production of eggs (they are lighter in weight than broilers, and so fattening cockerels from this second category with balanced feed bought in a bag is not as economically viable as doing the same with broilers).
2. International business environment
The biggest chicken meat producing countries are the USA, China and Brazil. Brazil and the USA are the two biggest exporters of chicken, together accounting for about two-thirds of global chicken exports. For international projections and statistics find the latest OECD-FAO Agricultural Outlook document at www.fao.org.
- USA Poultry and Egg Export Council (USAPEEC) – www.usapeec.org
- The Brazilian Poultry Association (UBABEF) and Brazilian Meat Producers and Exporters Association (ABIPECS) merged to form the Brazilian Association of Animal Protein (ABPA). Poultry is marketed under the concept "Brazilian chicken". Find the website at www.brazilianchicken.com.br/en
Sources of international information include:
- Find the current world production, market and trade reports at www.fas.usda.gov, the Foreign Agricultural Service arm of the US Department of Agriculture. The poultry circular is at https://apps.fas.usda.gov/psdonline/circulars/livestock_poultry.pdf
- Find worldwide poultry updates at www.thepoultrysite.com, www.worldpoultry.net and the Poultry International pages at http://wattagnet.com
- The International Egg Foundation (IEC) – www.internationaleggfoundation.com
- International Poultry Council – www.internationalpoultrycouncil.org
- World Poultry Foundation – www.worldpoultryfoundation.org
- World Poultry Science Association – www.wpsa.com
South Africa: imports and exports
In 2016, poultry imports equated to 33% of domestic poultry production, in comparison with 28% in 2015. Poultry was imported from Brazil (41.7%), the Netherlands (19.7%), Spain (7.1%) and the USA (4.7%). The EU as a whole accounted for 48.1%, up from 41.7% in 2015 (SAPA, 2017).
South Africa imported 273 745 tons of chicken in the first half of 2017. Brazil supplied 52%, the USA 19.5% and Europe (Belgium, Ireland, Spain, Denmark and the UK) 19.4% of this (SAPA, 2017).
|South African producers’ ability to compete with imported cuts will depend on the extent to which they are able to maximise carcass value going forward. Individually Quick Frozen (IQF) pieces represent the bulk of the domestic market, but imports of bone-in portions are likely to continue and strategies that reduce exposure in the IQF market will reduce the impact of such imports on profitability. The industry is also exploring the possibility of growing exports, a strategy that has been very successful for beef producers in recent years. In order to do so, competitiveness in the global context is critical.
Source: BFAP BASELINE | Agricultural Outlook 2017-2026 p 77
3. African business environment
Africa, which imports nearly 83% of the food it consumes, has a real chicken and egg problem. The continent is caught between pressure from imports in some countries and an inability to meet demand in others.
Africa's chicken crisis is an expression of overall weaknesses in its agricultural system. If Africa cannot raise its grain production it cannot expect to do well in increasing its chicken output.
The solution to Africa's chicken crisis lies in upgrading agricultural systems overall. Here are the major limitations:
- Low-cost, high-quality feed. Expanding feed production involves investing in grain production, especially corn and soya. Research to increase efficiency and expand the range of feed sources will go a long way in helping to upgrade overall system.
- The lack of starter stock (chicks and broilers bred specifically for meat production). Improvements in this area will require better breeding and extension programs akin to those needed for crops. Nearly 84% of chicken in Kenya is based on local breeds that have low levels of efficiency in converting feed into meat.
- Disease control. Disease control is a problem for both crop and livestock producers and requires more investment.
- Poor infrastructure (especially energy, transportation and water supply systems) is a major barrier to the expansion of chicken production, especially in rural areas. A lack of cold storage facilities forces farmers to keep feeding their chickens instead of slaughtering and refrigerating them. They generally transport live chickens to markets, which raises logistical costs and increases concerns over disease transmission.
- The lack of credit for producers. Countries that provide credit for crop producers to purchase seed and farm input have the opportunity to extend their incentives to chicken production. Most African countries lack such systems and it is unlikely that they will introduce them for poultry farming if they do not have them for crop production.
So far Africa can hardly feed its people. But even worse, it cannot feed its chickens so that it can feed its people. The chicken crisis is yet another reason why Africa must focus on getting its agricultural act together. The crisis is a warning to African leaders: they need to wake up with the chickens and act in time.
Source: excerpts from a piece written by Calestous Juma, professor of the Practice of International Development, Harvard University, at http://ewn.co.za/2016/09/21/OPINION-If-Africa-learnt-to-feed-its-chickens-it-could-feed-its-people
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