The poultry industry which provides employment to over one million people will face a major setback due to the high cost of production, chairman of the All Island Poultry Association, Dr D.D. Wanasinghe, told the Sunday Observer in Sri Lanka.

He said there was a sharp drop in chicken consumption due to the high cost of poultry feed. Over 50 per cent of the poultry feed consists of maize which is imported at a high price.

"The poultry industry has to pay 25 per cent Cess on imported maize.

"The industry has been heavily taxed and there are no incentives granted through the budget. Over 75,000 farmer families depend on the poultry industry as a self-employment livelihood and around 100,000 are input suppliers," Dr Wanasinghe said.

Prices of eggs and chicken have not increased to the level of what it should be compared to the drastic hike in prices of poultry feed. The price of an egg is around 11 rupees, which below the break-even price for farmers.

He said the Poultry Association has held discussions with officials of the Ministry of Livestock Development on the need to reduce the cost of production which will help sustain the poultry industry.

"There has been more attention on the dairy industry than the poultry industry.

The Ministry of Livestock Development is focusing on increasing the production of milk and not adequately supporting the poultry industry," he said.

Dr Wanasinghe told the newspaper that Sri Lanka is not affected by the bird flu (avian influenza) H5N1 but cannot rule out the risk of birds being affected by the epidemic spread through migratory birds.

According to reports over 60 per cent of the infected birds in the neighbouring countries have died. Several birds in India, Pakistan, Bangladesh, Nepal and Burma have been killed by the deadly virus.

"The Veterinary Research Institute has launched a surveillance program to inspect places where migratory birds settle to take precaution on the spread of the disease," he said. There has never been an attack of the avian flu on birds in Sri Lanka. Precautions have been taken to prevent the spread of the disease in the country.

The Food and Agriculture Organisation and the World Bank have granted funds to set up surveillance systems and train poultry farmers to detect the behaviour of backyard birds.

"Poultry farmers will be assisted to build cages to prevent contracting the virus from infected migratory birds," he said.

An official of the Health Ministry said that steps have been taken to monitor the situation in the region and prevent the spread of the disease, according to Sunday Observer. The H5N1 virus spreads primarily through migratory birds and infected poultry material.