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Why has chicken meat suddenly become so expensive in Pakistan?

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Why has chicken meat suddenly become so expensive in Pakistan?
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      The sudden and significant increase in chicken meat prices in Pakistan is a complex issue driven by a confluence of factors, as reported by various sources. Here's a breakdown of the key reasons: 1. Soaring Input Costs, Especially Poultry Feed: Feed as a Major Expense: Poultry feed accounts for a suRead more

      The sudden and significant increase in chicken meat prices in Pakistan is a complex issue driven by a confluence of factors, as reported by various sources. Here’s a breakdown of the key reasons:

      1. Soaring Input Costs, Especially Poultry Feed:

      • Feed as a Major Expense: Poultry feed accounts for a substantial portion (70-80%) of the total production cost for farmers.
      • Soybean Import Issues: A major contributing factor has been the ban or severe restrictions on the import of genetically modified (GM) soybean, a critical ingredient in poultry feed, since October 2022. While non-GM soybean is imported from African countries, it’s often of lower quality and more expensive due to container shipping rather than bulk shiploads.
      • Global Commodity Price Fluctuations: Pakistan’s reliance on imports for key feed ingredients like soybeans and corn makes the poultry industry vulnerable to global price shifts.
      • Increased Local Feed Prices: The price of poultry feed has skyrocketed, with reports of increases up to 82% in the recent past.

      2. Cartelization and Market Manipulation:

      • Hatchery Cartel: There are strong allegations of a “hatchery cartel” that has artificially inflated the price of day-old chicks. These chicks are reportedly being sold at significantly higher prices than their actual production cost.
      • Control by Large Companies: A few large breeding companies that also own their farms are accused of manipulating supply. When live broiler prices drop due to supply-demand dynamics, these companies reportedly do not pass on the lower prices to consumers. Instead, they use the breed for their own farms, and in some cases, restrict breeders for extended periods, leading to closures of smaller poultry farms.
      • Unregulated Market Structure: The lack of robust regulatory frameworks and oversight allows for price manipulation and inconsistencies across different regions.

      3. Decline in Production and Supply Issues:

      • Farm Closures: The unbearable production costs, primarily due to high feed and day-old chick prices, have led to the closure of a significant number of small and medium-sized poultry farms (over 50% according to some reports). This directly reduces the overall supply of chicken.
      • Reduced Grandparent Stock Imports: The import of “grandparent stock” (GPs), which are birds that produce parent stock, has dramatically decreased. This has a cascading effect on the number of broilers available for consumption, leading to a projected significant drop in chicken production.
      • Poultry Diseases and Mortality Rates: Outbreaks of diseases like avian influenza can devastate flocks, leading to mass culling and further reducing supply. Increased vaccination and veterinary costs also add to the overall expense.
      • Supply Chain Disruptions: Inefficiencies in the supply chain, including high transportation costs, poor storage facilities, and the involvement of multiple intermediaries and commission agents (whose fees can be substantial), contribute to increased prices and spoilage.

      4. General Inflation and Economic Conditions:

      • Wider Inflationary Pressures: Pakistan has been experiencing high general inflation, which impacts all aspects of the economy, including transportation, labor, fuel, and electricity – all contributing to the cost of chicken production.
      • Currency Depreciation: The depreciation of the Pakistani rupee against major currencies makes imported inputs (like feed ingredients) even more expensive in local currency terms.
      • Increased Energy Costs: Poultry farms often rely on diesel generators in areas with unreliable electricity, and rising fuel prices significantly add to their operating costs.

      5. Government Inaction and Regulatory Loopholes:

      • Weak Enforcement of Price Controls: Despite government-imposed rates, chicken and meat are often sold far above official prices, indicating lax enforcement and regulatory loopholes. For instance, the Punjab government might set prices for live chicken but not for processed broiler meat, allowing sellers to exploit the gap.
      • Lack of Support for Farmers: Small farmers often lack access to financial credit, modern equipment, and proper training, making it harder for them to sustain their businesses amidst rising costs.

      In summary, the high cost of chicken in Pakistan is a result of a perfect storm of rising input costs (especially feed), alleged cartelization and market manipulation, reduced production due to farm closures and import issues, general economic inflation,

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