Chicken: Rising production costs hit breeders

Annual per capita consumption of chicken in Sri Lanka, which was barely 2.5 kg a decade ago, has now reached 8.2 kg and may reach 10 kg in the near future. While consumption has risen more than three-fold, prices have remained virtually unchanged during this period.

This can be attributed to the extremely efficient practices adopted by Sri Lankan chicken growers across their production, processing and distribution systems. They have implemented global best practices in technology and breeding, which has led to more efficient production and significant reduction in costs, which they have passed on to the consumer.

Chicken producers such as Crysbro have gone a step further by fully integrating their entire operations. Crysbro carries out virtually every activity that is required to produce its 'Fresh Upcountry Chicken'. From producing grains in its extensive farmlands, converting the grains into poultry feed at its feed mill plant, to raising parent birds and broilers, processing meat and packaging it - right down to delivering the chicken to supermarkets and retail outlets. In fact, Crysbro is Sri Lanka's first chicken producer to achieve full vertical integration.

Yet, rising costs remain an issue that chicken producers have to constantly battle against.

Cost of feed alone accounts for up to 70% of the total production cost. In addition to grains such as rice, maize and soya, poultry feed should contain a balanced protein diet, which is a practical application of the Ideal Amino Acid profile, which stipulates the correct minimum levels of essential and non-essential amino acids to be included in the poultry feed. Reducing the cost of feed invariably leads to a reduction in the body weight of birds, thereby negating any savings achieved by adopting this measure. Thus, chicken breeders have no way of reducing this component of their costs.

Bio-security and sanitation practices adopted by chicken breeders may ensure superior quality and freshness of their chicken, but they also make costs escalate. For instance, Crysbro carries out vaccinations and health check-ups for its birds, in addition to regular testing of its breeder farms, hatcheries and processing plants for biological and chemical pathogens.