Financial Times

Traders and producers clash over chicken prices
Just as the Sinhala and Tamil New Year season kicked off earlier last week, chicken traders and producers got embroiled in a dispute over prices. The Manning Market Poultry Traders' Association in a statement accused the All Island Poultry Association(AIPA) representing producers as acting like a price control unit in setting prices which are unreasonable.

Here are excerpts of the Manning Traders statement:
"After the tsunami aftermath, the price of chicken has soared to a record high. It was expected that with the fishing industry resuming its activities after the December 26 setback prices could stabilise to normal levels that is Rs. 80 per kg, live weight.

Major poultry producers prior to 26/12 deliberately cut back their production level because the supply was over and above the levels of demand. The supply situation also changed due to poultry farms being affected in tsunami-hit areas.

Now what is seen is a 300% increase in prices. The bird flu was felt in the Far East and should have not been a reason for the bigger farms to cut back on production. India was not severely affected by the bird flu.

This was a deliberate attempt by the major poultry farmers to obtain a higher price during the festive season using the bird flu as a scapegoat. Of course they never expected a tsunami to foil their plans.

The Ministry of Agriculture has not come to grips with the actual situation. For a consumer to pay an increase of 300% in prices within a period of three months is quite an extraordinary situation. The All Island Poultry Association (AIPA), has assured the Ministry that they will not increase the price beyond Rs 215 or Rs 240 per kg.

When did they take over the functions of the Price Control unit of the Ministry of Trade? In fairness to the Ministry of Agriculture, the AIPA can sell the chicken to the Ministry of Agriculture and they in turn can collaborate with the Ministry of Trade and market them in the same way they market low-priced imported rice. On the other hand producers are resisting the idea of imported chicken coming into the country at a cheaper price.

The Manning Market Poultry Traders Association has traded in this business for more than five decades. A majority of our customers are low and middle-income earners and at this price nobody will want to buy any chicken.

The Ministry of Agriculture and the AIPA are not aware of the basic supply and demand position of chicken during festive seasons and the statements they have issued to the media is a clear indication of their ignorance. Apart from all this the buying power of the common man is at the lowest ebb."

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