After six years of impressive growth, Zimbabwe’s broiler industry, the largest meat industry sub-sector, has experienced negative growth for the second year running.
The latest quarterly report of the Zimbabwe Poultry Association (ZPA) shows that estimated broiler meat production in the first nine months of 2016 was down 1 percent over the same period in 2015.
If this trend continues into the last quarter of 2016, the industry projects a further decline in broiler meat production from 116 000t achieved during 2015 to 115 000t this year.
The negative growth in broiler meat production is a worrying sign that will impact on the future supply of Zimbabwe’s most widely consumed meat, as well as have adverse ramifications on the country’s stockfeeds industry. Poultry feed production accounts for 75 percent of the market demand for stock-feeds.
There are disturbing market signals threatening the stability of the poultry industry, which has been instrumental in ensuring speedy recovery of Zimbabwe’s self sufficiency in meat requirements since 2009.
As broiler meat retail prices fall below production costs, this has had a knock-on effect of increased stockholding of broiler meat by poultry abattoirs. Day old chick sales are also flat and many small-scale chicken farmers have gone out of business – all worrying symptoms of a looming crisis in the once vibrant poultry industry
The latest ZPA quarterly report also shows a decline of 6 percent over the same period last year in hatching eggs placed in hatcheries for January – September 2016.
Although there was an increase of 10 percent in local production of hatching eggs from breeding companies, this was accompanied by a decrease of 44 percent in the importation of hatching eggs.
An average of 6.2 million day old chicks per month were produced for sale and retention from January – September 2016. This is a decline of 5 percent and 7 percent over the average monthly figures for the same period last year and 2014, respectively.
While economic hardships have eroded consumer spending power during the second half of 2016, the industry is gravely concerned about unfair competition from illegally imported poultry meat that is also contributing to the decline in sales of Zimbabwean poultry products.
Mirror data from South Africa confirms the export of 800t of chicken meat to Zimbabwe between April and September, supporting the concern about the continued inflow of grey imports of poultry meat even though relevant authorities have asserted that no import permits for chicken meat have been issued.
The discovery of dumped packaging from poultry offal — carrying a label “product origin South Africa” — would indicate that product is coming into Zimbabwe illegally.
The report for the second quarter of 2016 from the South African Poultry Association lists Zimbabwe among the countries importing South African poultry products. However, these imports are not reflected in Zimbabwean trade statistics, raising further concern that South African products are entering the country illegally.
Egg production continues to grow
Production of table eggs in the large-scale sector continues to recover from the lows of mid-2015. The number of birds in-production increased by 14 percent from 807 500 in July 2015 to 920 400 in May 2016.
This is reflected in an increase in table egg production from nearly 1.4 million dozen per month to 1,9 million dozen for the same period.
However, egg production in the small-scale sector, which grew from 2,2 million dozen in May 2015 and peaked at 3 million dozen per month from December 2015 to May 2016, is estimated to have declined to 2,6 million dozen in September 2016.
This is primarily due to the dramatic downturn of layer chick sales into the smallholder sector. However, of grave concern, is that the average wholesale price of a tray of eggs remains depressed at $3,21, which is 19 percent lower than the price obtained in 2015.
Knock-on effects in the stock-feeds industry
Poultry is by far the largest consumer of stock-feed, accounting for 70 percent of the total production tonnage and 75 percent in monetary value.
Since 2009, the revival of the stock-feeds industry has largely been on the back of the expansion of the poultry industry, with pig and ruminant feeds accounting for 7 percent and 11 percent respectively of total value of feeds produced.
Shrinking broiler production has had a knock-on effect on the feed industry. The report for the period January to September 2016 from the Stock-feed Manufacturers’ Association shows a decrease of 9 percent in procurement of raw materials and a decrease of 8 percent in stock-feed production during the first nine months of 2016 compared to the same period last year.
Despite increases in the prices of key ingredients such as maize and soya meal (from 3 percent to 14 percent), the stockfeeds industry contained the price of both broiler and layer feeds to the farmer in the third quarter of 2016.
The average weighted broiler feed price remained the same, $583/t, with an average reduction of 2 percent in layer feed prices.