Political Unrest Slows Poultry Sector

YEMEN - Over the last 18 months, the cost of a single egg has soared to YR 40 – having not exceeded YR 15 in the previous five years – as Yemen’s ongoing political instability continues to affect food prices.
calendar icon 16 February 2012
clock icon 6 minute read

While the local commercial production of eggs covers all domestic needs, according to the UN Food and Agriculture Organization (FAO), rising prices are forcing more people into food insecurity.

Yemen now has the fastest growing population in the Arab world, and due to the high annual population growth – which now exceeds 3 per cent a year – food security is becoming an increasing problem. On average, each Yemeni consumes 3.8kg of red meat, 6kg of white meat, and 48.9 eggs a year. According to the FAO, the recommended animal protein requirement can be fulfilled by 43.5kg meat (white or red), 100 eggs and 90 liters of milk.

Bilal Al-Eryani, who owns a grocery store in Sana’a, said that eggs used to be the most popular item in his shop, but many customers have been forced to stop buying them because of the high prices.

"Some people are forced to continue buying eggs as they are essential to children, but they are pinning their hopes on the idea that prices will fall soon," he said.

Abu Mazen, a family breadwinner in the capital, said he was shocked over the drastically rising prices, which jumped more than 160 per cent over the past 18 months.

He added that since he could not afford to buy as many eggs, he began researching their disadvantages to feel better about reducing their consumption. "So we decided that every member of family should have 2-4 eggs per week under the pretext that eggs are the main cause of high cholesterol," he explained.

Mansour Al-Fadhali, owner of a school cafeteria, said people always complain about the price hikes – especially when it comes to essential foodstuffs.

"However, people ultimately accept and live with the new prices or adapt their habits," he said. "Nowadays, students and staff have stopped buying egg sandwiches and instead buy cheese and beans sandwiches."

In 2010 Yemen produced 1,160 million eggs, up from 960 million in 2006, according to the Ministry of Agriculture and Irrigation – however, demand is rising faster than domestic production, reports Yemen Times.

Marzooq Mohsen, chief of the Yemen-based Economic and Social Development Research Centre, attributed the rising cost of eggs prices to the fact that locally produced eggs no longer meet the demands of consumers.

Rising fuel prices and the deterioration of Yemen’s farming infrastructure also contributed to the rising cost.

"Yemen has thousands of poultry farms that produce hens and eggs in the uplands, including Dhamar, Amran, Sana’a, Marib and Sa’ada, but the consumption of eggs always increase due to the high population growth," he explained.

Abdul-Azeez Mutea, an investor in the poultry market, said that one of the main challenges is the spread of epidemics that lead to big losses but stressed that diesel fuel costs and power outages are also disrupting production. "Thousands of hens died in the past two months due to the cold winter," he said.

Yemen’s food security has deteriorated over the past decade due to declining oil production, mounting food import costs and socio-political instability – all of which were exacerbated during the unrest in 2011. The UN’s World Food Programme (WFP) has warned that the situation is likely to deteriorate further in 2012 as Yemen struggles with ongoing fuel shortages and rising prices, thousands of internally displaced people (IDPs) and refugees from the Horn of Africa, to name just a few issues the country is tackling.

The International Food Policy Research Institute indicates that Yemen is using a quarter of its total export revenues (or nearly $1.8 billion in 2010) to finance food imports – compared to an international average of 9 per cent.

According to the WFP, 80 per cent of Yemen’s food is imported.

Over 400,000 people work in Yemen’s poultry sector and its related industries and services, while some 1.2 million rural families also raise backyard poultry, according to FAO.

But last year’s political unrest – which resulted in large-scale power cuts and fuel shortages – slowed progress of the industry, further increasing the cost of eggs and chicken.

Yemen’s poultry sector is one of the biggest in the country and makes up the largest part of the country’s livestock industry, with capital estimated at more than $1.5 million, according to a 2008 FAO study.

The total annual meat consumption – including both red meat and poultry – is estimated at about 371,500 tons, with poultry making up 251,500 tons. This means that the poultry sector supplies 67.7 per cent of Yemen’s meat consumption.

Large-scale poultry production covered just over half the domestic demand, while 3.4 per cent comes from backyard production and imported frozen chickens are used to meet any remaining demand.

However, the FAO statistics are based on a 2006 survey that showed 1,566 poultry farms across Yemen, with 3,282 sheds.

The highest density of poultry farms is found in the highlands but all hatcheries are located in the lowlands of Tihama, west Yemen’s hot, costal region.

Although the industry is struggling to meet consumer demands, the FAO estimated in 2008 that Yemen’s poultry sector would grow by 10 per cent over the next decade.

Therefore, poultry meat production could be increased up to 253,000 tons.

Adel Al-Shtal, official at the General Investment Authority (GIA), told the Yemen Times that chickens are easy to keep and are the only animal products on the rise.

"Animals producing red meat such as sheep, or fish that produce white meat are all decreasing, but poultry is on the rise," Al-Ashtal said. He added that there are currently 300 large poultry farms registered by the GIA, explaining that with Yemen’s high population growth and the increasing demand on the white meat, investment in this sector is on rise.

"Today’s poor investment situation is exceptional and will not continue," he said. "If any investor is interested in starting up his business in this field, they should base their project on Yemen’s long-term business environment," concluded Al-Ashtal.

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