prospects and challenges in the development of poultry industry

30 November 2013 dr.abramoza mtcp2008 1

MALAYSIA

30 November 2013 4

The Past –

Those were the days

1970 - 80’s

30 November 2013 5

In the 90’s & early 00’s

WHERE

ARE

WE

NOW?

30 November 2013 6

Broiler Production Chain

7

Raw

Material Breeding & Growing Processing

Distribution &

Retail

Feed

Milling

Grand

Parent

Stock

Parent

Stock Farming Processing

2nd

processing Distribution Retail

All

integrator

s have

feedmills

Independent

mills

10

interators

produce

~70% of

DOCs for

sale

internally

and open

market

13 non-

integrator

s produce

~30% of

DOCs

Integrator

owned

farms

Dominate

d by

contract

farming

by

integrator

s (~70%)

Independ

ent broiler

farms

(~30%)

Integrated

players

have

larger

plants

Non-

integrator

s typically

with

farms or

secondar

y

processor

s

Traditiona

l

slaughter

Integrated

players

have larger

plants

(e.g:

Ayamas,

Farm’s

Best,

Dinding,

Ayam A1)

Independe

nt factories

Independen

t

wholesaler

Own

outlets

Restaura

nt

Modern

retail

hyper &

supermar

ket

Wet

markets

dominate

retail

Integrator

owned

distributors

4

integrated

players

control

100% of

productio

n

Evolved from small back-yard

operations

into relatively modern, large-scale

commercial operations.

Factors:

High-quality poultry breeds

Highly efficient integrated

production systems

Competent veterinary services

Regulation and enforcement

in placed

8

INTRODUCTION

Poultry sector is the biggest component of livestock industry in Malaysia

Supplying about 81 % of the total meat and almost 111% egg demand by the domestic market

The industry supplies domestic demand and also exports, mainly to Singapore, Brunei DS, Hong Kong and Japan

9

INTRODUCTION

Principle source of meat protein (cheap)

because no dietary prohibitions among

local culture and religious norms.

Per capita consumption poultry

products (among the highest in the

world):

38kg. for chicken meat

19kg. of eggs (330 pieces)

10

INTRODUCTION

STATUS OF THE INDUSTRY

INDUSTRY STATUS (2012)

Types of Operation

No. of Companies

No. of Farms

Population (m)

Grand Parent

4 4 0.90

Broiler Parent

23 79 11.35

Layer Parent

5 14 0.31

Comm. Broiler

Individual/

Contract

+/- 2600 118.52

Comm. Layer

Individual/

Contract

+/- 300 47.35

12

PRODUCTION PERFORMANCE (2012)

Parameters Broiler Layer

DOC (m)

Broiler/eggs (m)

Parent Stock Companies

Grand Parent Stocks

Companies

PS Standing population

Breeds

DOC price (ex-farm)

Broiler/egg price (ex-farm)

COP (RM/kg)

Export live broiler/egg (m)

673.9 birds

637.0 birds

23

4

5.66 m.

Cobb,

Ross

0.90-1.95

3.20-5.50

4.72-5.09

42.78

37.95(pullets)

9,103 b

5

0

558,772

Hisex,

Lohmann Brown

2.00-2.50

29.50 cents

30.00 cents

1,492 13

COMMERCIAL BROILER PRODUCTION

(MILLION BIRDS)

471.56 491.47 516.23 524.04

614.5637

720.11

0

100

200

300

400

500

600

700

800

2007 2008 2009 2010 2011 2012 2013*

BroilerProduction

30 November 2013 14

#

# projected

Value: RM6.03 billion (farm-gate)

Source : DVS (Malaysia)

Millions

COMMERCIAL EGGS PRODUCTION

(BILLION EGSS)

7.77 7.52 7.66 8.298.92

9.1

12.27

0

2

4

6

8

10

12

14

2007 2008 2009 2010 2011 2012 2013*

Table EggsProduction

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#

# projected

Value: RM1.78 billion (farm-gate)


Billions

DAILY OUTPUT (2012)

• 1.75 million chickens (6.72 % Exported)

- 70% of broilers go through wet markets

• 24.94 million table eggs

(5.97 % Exported) - >99% of table eggs reach

customers as fresh in-shell eggs

*Singapore is a captive market

(~94.2%)

16

PROJECTION OF BROILER PRODUCTION

(MILLION BIRDS)

2007 - 2015

1,005 1,0

66

951.3

7

903.2

5

860.3

637.0

0

614.5

0

720.1

1

637

614.5

524.0

4

0

100

200

300

400

500

600

700

800

900

1000

1100

1200

2010

2011

2012

2013

*20

1420

1520

1620

1720

1820

1920

20

BroilerProduction

30 November 2013 17

# projected


Millions

PROJECTION OF COMMERCIAL EGGS PRODUCTION

(BILLION EGGS)

2007 - 2015

8.29 8.9

29.1

01

12.27 12

.88 13.53 14

.21 14.92 15

.67 16.45 17

.27

0

2

4

6

8

10

12

14

16

18

20102011

20122013*

20142015

20162017

20182019

2020

Table Eggs

Production

30 November 2013 18

# projected


Billions

Challenges

Free World Trade and Global Sourcing (Unknown impact of Tarrification / AFTA)

Opens up the country to the dangers of importing products of below standards

Fierce Market Competition

Any slack in demand or over supply will lead to producers selling below cost.

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Challenges

Consumer Power and Choice

Consumers are more educated and their

expectations are higher; Halal products

Food poisoning and product shelf-life become

challenges to producers and retailers.

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Challenges

Fast Food/Catering Expansion

The present work culture coupled with the growth

of suburban, establishment of shopping

complexes and food courts - the role of fast food

restaurants is greatly enhanced

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Challenges

Growth of Hyper/Super-marketing

Fast growing chains because of their comfortable environment, comprehensiveness and convenience.

New Technology

Application of advanced technology in detecting very low levels of chemical and drug residues in poultry products

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Challenges

Traceability

Due to consumer awareness, product identification and traceability are therefore important in QA programs

Food Scares

Disease outbreaks, sensational statements by politicians or media – cause consumers to stay away from the food products for a damaging period of time.

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Challenges

Imports and Smuggling affect supply/demand balance

Why?

a. Difficulty to get source locally in quantity and at reasonable price

b. Deterring market for local producers

c. Difficulty to stop smuggling

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Challenges

Suitable and strategic production

areas are becoming limited

Development encroaching the existing production

areas.

Permanent Poultry Production Area?

Justify/future land use, check with the local

authorities

Regular conflict with Land and Local government

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Challenges

The Disease

- A Global Challenge to Agriculture and Public

Health

- The Impact of the Disease and of its Control

- Much is not Known of the Disease and its

Origins e.g. HPAI

30 November 2013 26

Challenges

Environmental Pollution and Public

Nuisance

a. Flies

b. Bad odor

c. Dust

30 November 2013 27

Challenges

Production Cost - increase due to Feed Cost

70% of the production cost is on poultry feed.

Competition for feed resources with global energy demands (bio-fuel production)

Most of the feed raw ingredients are imported

30 November 2013 28

Challenges

Poultry Welfare

- increasing concerned about the health and welfare of chickens kept for meat & eggs production.

- GAHP – improved health & welfare

- prevent diseases and mitigate any negative environmental impacts

30 November 2013 29

Future

Trends

30 November 2013 31

Advance Technology Utilization

TRANSFORMATION OF POULTRY INDUSTRY

30 November 2013 32

Disease free Market status information Tech. Advisory GAHP Integrated Value-added farming products

Land & utility Processing investment plant Farm Expert Infrastructure advice Automations

Shed near housing area Unorganized farm Opened-house Pollution Ease in disease outbreak Heat stress

FUTURE

Zoning & Environment friendly Closed-house Cost effectiveness Improved productivity Increased production Quality & safe products

WHERE

DO

WE

WANT

TO

BE?

30 November 2013 33

THIS IS WHAT WE NEED TO ACHIEVE… so

that:

Poultry farming and processing are in

harmony with the environment

Production efficiency is at par with the world

standards

30 November 2013 34

THIS IS WHAT WE NEED TO ACHIEVE… so

that:

Consumers are fully confident with local

products which are free from residues and

contaminants

Our poultry products achieve the standards

accepted by importing countries

30 November 2013 35

Goals for the Poultry Industry

To establish production and processing

facilities

Ensure poultry products are safe and

wholesome, and competitive

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30 November 2013 37

To establish Quality Assurance programs

Dynamic, continuous improvement to meet the changing demands of the consumer and industry


To expand the practice of product

specification, identification and

traceability

To conduct more risk management

To assess the validity of current QA

To provide a basis for future improvements

30 November 2013 38


To create more trading partnerships and

alliances for better coordination and

effective action plans.

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Important quality measures in the

poultry industry

Adequate attention and commitment to:

Environmental sanitation and waste management

Bio-security programs

Pest control programs

Statistical evaluation and risk assessment –

identify the hazards

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poultry industry

Animal welfare – in farming and transportation

GAHP – to ensure the birds are healthy and

achieve the desired productivity

GMP – with SOP must be comprehensive and

practical; help to reduce rejects and wastage;

thus increase yield

30 November 2013 41


poultry industry

HACCP – to keep hazards away therefore

products are safe and wholesome

Products identification and traceability

Continuous improvement !!!!– to prevent

complacency

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poultry industry

Training and manpower development – essential

for the development of the quality culture,

business development and sustainable growth

Accreditation and certification by regulatory

authorities (SALT & VHM)

Management leadership

30 November 2013 43

Conclusion

Diligent and commitment

from all the parties concerned are

essential to further help the

poultry industry move towards achieving the

target envision

of a country

30 November 2013 44

prospects and challenges in the development of poultry industry

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