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Producers under Pressure from High Feed Prices

by 5m Editor
25 August 2011, at 9:00am

UGANDA - High feed prices are driving poultry farmers out of business.

The scarcity of poultry feeds has hit the industry hard, forcing some farmers out of business, reports The Monitor. The key ingredients in the production of chicken feeds include maize bran, rice bran, cotton seed cake, wheat bran, palm kernel cake, groundnut cake and fish and mukene (silver fish).

Esther Genza, an employee at Kagodo Feeds, says the industry's biggest challenge has been the scarcity of maize and maize bran.

She said: "Towards the end of last year, a 100-kilogramme bag of maize cost 70,000 shillings [UGS]. It now costs between UGS140,000 to UGS150,000." She attributes this to the exportation of maize to neighbouring countries especially Juba.

Aga Sekalala Jnr, who runs Ugachick, one of the leading poultry companies in the country, agrees that prices are leaping upwards.

He explained: "In February, we used to buy a kilogramme of maize at UGS480 but today, a kilogramme goes for UGS1,650. There are inputs that we have to import like breeding facilities and this automatically increases the cost of doing business."

Just like Ms Genza, he explains that maize is the denominational commodity which has more than tripled in prices, saying: "Much of the grain that's grown locally is lucratively sold in neighbouring South Sudan and Kenya leading to a shortage and natural increase in price."

The country has also been hit by the scarcity of mukene, which phenomena has been attributed to depleting fish in Uganda's fresh water sources making the commodity very expensive due to high demand. Most of it is got from Lake Victoria, Kyoga and Albert. Also, early this year, the Ministry of Agriculture banned fishing of mukene from Lake Albert but even after the ban was lifted a few months later, the supply remained low. This explains the increased price of mukene currently at UGS80,000 a sack, up from UGS60,000 in March.

Two months ago, a bag of chicken feed cost UGS55,000. "The same feed is now at least UGS75,000," says Ms Genza.

Mr Sekalala explains that they are trying so hard to incur short term losses to be able to sustain business in the long term.

Ms Genza adds that the problem is compounded by the relatively stable prices of chicken products.

"It is very hard to increase the price of a tray of eggs or chicken because the market response is poor. Few people buy at higher prices," she told The Monitor.

Ms Genza is urging the government to stem the rate at which maize is exported to Juba particularly; to have alternative reserves or silos of grain for times like these; and to offer financial assistance to farmers even those on the NaadS programme.