Short Supplies Push up Prices

NEPAL - A shortage of supply is pushing up market prices for chicken.
calendar icon 31 December 2009
clock icon 4 minute read

An increase in production means improved supplies and subsequent fall in prices – a natural phenomenon in open market system. But this natural practice cannot be seen in poultry market, thanks to unhealthy practice by traders and entrepreneurs to control market price.

Republica reports that the poultry price has been going up over the last few weeks after entrepreneurs in the Kathmandu Valley imposed quota on import of poultry products from Chitwan. After imposing quota on imports, valley entrepreneurs raised the price, citing lower supply from Chitwan, the largest poultry producer in the country.

Chicken price has gone up to 210 to 220 rupees (NPR) in retail shops in the Valley though local traders' association has fixed the price at NPR200 per kilo. Chicken was selling for NPR180 per kilo two months ago.

Poultry entrepreneurs in the Valley also said shortage of chicks could aggravate supplies in coming season and push the prices upward in coming days.

Gokarna Ghimire, president of capital-based Poultry Farmers' Association, said: "Chicken price could further go up in coming days as farms are facing shortage of chicks. He explained that production of chicks had dropped to 600,000 per month from 900,000 just a few months ago.

He added: "The chicken population has dropped by 40 per cent in farms based in the capital. Supplies of broiler chicken has also dropped to around 70,000 heads a day from 100,000 heads per day a few months ago."

Meanwhile, poultry entrepreneurs in Chitwan have complained that disruption in supplies to major markets, including Kathmandu, Pokhara and Butwal, have created problems. They also said poultry production in local farms have increased as compared to a few months back. Poultry farms in Chitwan are producing 20 tons of live broiler chicken a day, up from around 12 to 15 tons a day recorded a couple of months back.

According to Janak Man Shrestha, president of Nepal Poultry Market Management Association, Chitwan exports more than 50 per cent of poultry products to other districts of which 90 percent are supplied to the capital.

He told Republica: "We are still facing restriction on exports. Valley-based farmers are allowing us to export only five small truck loads of chicken a day, despite improving production. They have not lifted restriction on exports despite recent understanding between farmers in Chitwan and Valley to lift restriction." He added that poultry prices in the Valley are rising due to the restriction on exports.

Valley-based farmers had put a quota system in place on import of poultry products mainly from Chitwan, claiming that their products were not finding market due to overflow of poultry products from Chitwan.

However, Mr Ghimire said the restriction was meant only for poultry products imported from India.

According to Republica, the chicken price had sharply gone down to NPR180 from NPR240 per kilo in September. Live chicken is selling in the range of NPR115 to 120 per kilo in Chitwan, and NPR140 to 150 in the Valley.

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