Poultry farmers allegedly cut supply to keep prices high

Traders deny accusation, blame high cost of feed for expensive meat, eggs

RAWALPINDI:

Owners of poultry farms have colluded to control the prices of a live chicken, poultry meat and eggs to keep the prices high, market sources alleged.

The farm owners and top dealers of poultry products have come up with the idea to artificially control the supply and demand in Rawalpindi so as to get the desired price, they alleged.

However, a representative body of brokers and traders of poultry, Rawalpindi Poultry Arhat Association (RPAA), said the current high prices were due to an increase in the exchange rate of dollar which has subsequently increased the prices of the import components of the poultry industry.

RPAA Secretary General Qazi Zahid Mahmood said the price of poultry products have jumped up due to the increase in the cost of poultry feed which was imported and paid for in dollars. Similarly, the weak rupee has escalated the cost of grandparent stock that were also imported to raise the second generation layer and broiler chicken.

Farmers are reluctant to raise flocks due to high input costs, Mahmood said. Scores of poultry sheds are empty creating a shortage in the market and subsequent increase in the prices, he said.

Nevertheless, market sources claim that the farmers’ bodies have distributed sectors among themselves through an unwritten and verbal agreement so that they could avoid a glut or oversupply in the wholesale market which causes the prices to fall, a poultry trader claimed.

They are now raising flocks in cycles, so that supplies from farms come with spacing, he said explaining that it takes 45 to 60 days for a chick to become a table bird, so the farmers have colluded in a manner that flocks from one area grow up come to the market after the previous ones have been consumed. In this way, supply remains restricted and prices high, he claimed.

The poultry dealers are supplying chicken in limited quantities to specific markets in order to restrict the availability and make high profits. Meanwhile, the district administration has failed to break the market monopoly of poultry farms.

Currently, live chicken is selling at Rs265 while chicken meat is selling at Rs400 per kg in the open market. Earlier, poultry farms used to make their supply at the same time in all areas of the district, due to which chicken prices used to be at a reasonable level. However, the market has been monopolised by a few poultry farms which continue to restrict the supply to only a few markets of the city. With high demand in areas without supply, the prices of chicken have soared. The supply of chicken is restricted to just one market in Rawalpindi and after the hike in prices, other areas are catered.

The district administration and price control committees have completely disassociated themselves from taking any action against the elements responsible for the illegal control of the supply of chicken. According to sources, poultry farm owners have earned billions of rupees over the last three months due to a planned control of supply. The sharp rise in chicken prices in the open market has made the life of the common man miserable as no action could be taken against chicken profiteers.

The monopoly watchdog, the Competition Commission of Pakistan (CCP), is already looking into the issues of the poultry sector for any anti-competitive activities.

Enquiry in the poultry sector is going on where the CCP, on February 4, raided two major poultry feed mills based in Rawalpindi and Lahore to impound the proofs of their suspected involvement in collusive activities and collective fixing of poultry feed rates.

Published in The Express Tribune, March 9^th, 2021.