Special Assistant to Punjab Chief Minister, Firdous Ashiq Awan, said that Prime Minister Imran Khan has decided to regularize the poultry sector in Pakistan.
She said that the poultry sector has turned into a mafia in Pakistan, which has necessitated its regularization.
She added that the poultry mafia has political backing, and once this sector is regularization the prices of poultry items would not be decided on a cartel basis.
Firdous said that the PM had taken this decision, keeping in view the price-fixing strategies of the sector players. A bill will be introduced in the parliament to bring this sector under proper regularization, she informed.
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Inquiry Reveals How Cartelization Has Increased Prices for the Poultry Industry
Pakistani poultry industry’s turnover is around Rs. 1,082 billion, and it provides employment to more than 1.5 million people directly or indirectly. Yet, the segment remains an unorganized sector.
There are more than 15,000 poultry farms across the country, and the average capacity of farms ranges from 5,000 to 15,000 broilers. This economic sector has a growth rate of nearly 12 percent.
The Anti-Trust Watchdog hasd again acted against cartelization in the poultry industry and has completed an inquiry that uncovered nineteen poultry feed companies involved in price coordination, and their alleged anti-competitive conduct that had led to the increased prices of poultry feed in late 2020 that had, in turn, resulted in a sharp increase in the prices of chicken and eggs.
This is the third large-scale action by the Competition Commission of Pakistan (CCP) in the poultry industry. Earlier in 2010, it had imposed a fine of Rs. 50 million on the Pakistan Poultry Association (PPA), and had imposed a fine of Rs. 100 million on the PPA for cartelization again in 2010. This time, the poultry feed mills have come under the CCP’s radar.
Poultry feed is approximately 75 to 80 percent of the cost of broiler meat and eggs. Therefore, the hike in the prices of feed has affected the prices of chicken and eggs that are among the most commonly consumed high protein foods.
The CCP’s inquiry revealed that the feed mills had colluded to raise the poultry feed prices by Rs. 825 per 50 kg bag between December 2018 and December 2020, thus making the feed 32 percent costlier for poultry farmers.
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