January 17: The poultry business of Nepal, which was declared self-sufficient a year ago, is in a state of crisis.
The prices of maize and soybean, the main raw materials used for making poultry feed, have skyrocketed in the international market. The farmers have been forced to sell chicken at less than half the cost price due to the sudden decline in number of poultry farmers. This has led to a crisis in the business.
The government had declared Nepal self-sufficient in livestock last April. However, this sector is in trouble now.
The Nepal Poultry Federation does not have the exact data on the number of farmers leaving the poultry business after the skyrocketing price of poultry feed. However, entrepreneurs say that the number of poultry farmers has dropped dramatically. As a result, even the hatchery industry is in a dire situation. General Secretary of the federation Dinesh Mishra said that the hatchery industry is in trouble as the demand for chickens suddenly dropped after farmers stopped raising chickens.
According to him, the price of raw material has doubled in the last six months and the price of grain has increased by Rs 6 per kg. Soybeans, which used to cost Rs 60 per kg, have gone up to Rs 120 per kg. He said that the price of maize which used to cost Rs 28 per kg has increased up to Rs 40 per kg.
The government has now increased the customs duty on maize and soybean imports from 1.6 percent to 10 percent. “Poultry traders are further discouraged by the obligation to pay 10 percent customs duty on maize and soybeans, which constitute up to 80 percent of the raw material of poultry feed. This rule of the government has brought the poultry sector on the verge of collapse,” Mishra told New Business Age.
About 80 percent of the maize and about 99 percent of the soybean required for producing poultry feed in Nepal are imported from countries including the United States, Brazil and India.