ECONOMYNEXT – The poultry sector in Bolivia is seeing a Sri Lanka-style collapse in output and malnutrition of the flock amid and shortages and rising prices of feed, medicines as foreign exchange and energy shortages bite, according to media reports.
As Christmas neared shoppers were seeing steep rises in Chicken meat prices.
Chicken prices shot up to a historic price 23 to 24 Bolivianos a kilo on December 23, El Deber, a news portal reported.
In the last days before Christmas, the price of Chicken rocketed from 18 Bolivianos a kilo to 20 and then to 23 in Santa Cruz, and in La Paz the priced has jumped from 18.50 Bolivianos to 20.5/21.00 levels.
The Boliviano is officially at 6.9 to the US dollar but reports said the parellel rate has depreciated to around around 11 to 12 to the US dollar amid severe forex shortages.
Forex shortages emerge when macroeconomists print money to target a policy or other interest rates which are incompatible with the balance of payments, driving up credit. Ultimately the currency collapses after a period of official and/or unofficial parallel exchange rates.
Inflation typically starts to pick up rapidly towards the tail end of the central bank credit driven bubble as imports and exports take place closer to parallel exchange rates.
Bolivia’s Santa Cruz Poultry Farmers Association (ADA) has warned that due to the increase in poultry input costs, grain and dollar shortages prices may increase further in 2025.
Farmers slammed the Food Production Support Company (Emapa), an agency like Sri Lanka’s Paddy Marketing Board for not supplying maize and other feed grains in adequate volumes.
The government had carried out “disastrous campaigns in agriculture” that has led to a collapse in yield, the head of the poultry farmer association Omar Castro was quoted as saying by Bolivias El Dairio publication.
The year had begun with a corn price of 60 bolivianos per quintal (about 100 kgs) and it had risen over 100 percent to 125 bolivianos by the year end.
Forex shortages and exchange rate volatility, together with the commission rate for transfers abroad, has hurt farmers, they said. Imported inputs like vaccines, minerals, vitamins have also risen steeply.
“This increase, of more than 50 percent, has also been applied to equipment and spare parts for farms and incubators,” Castro said.
Breeding stock imports which were around 160,000 had come down steadily from April and was down to 100,000.
“This year we had to deal with the worst scenario regarding this fuel, days and weeks without being able to obtain it, which caused us to not be able to supply ourselves with inputs in a timely manner and therefore,” he said.
“We were unable to reach our farms with balanced feed, causing delays in the growth of the birds and even their death in some cases.”
His words recalled statements made by Sri Lanka’s veterinarians and producers that chicken were facing malnutrition and disease.
Sri Lanka’s Consumer Affairs Authority then imposed price controls on eggs, leading to accelerated culling of layers and a collapse of the sector which took almost two years to recover.
Related Sri Lanka livestock face malnutrition after money printing
“Animals can’t be kept hungry like humans,” Nuwan Hewagamage Secretary of the State Veterinary Surgeons Association said in March 2022, shortly before the currency collapsed.
“Farmers are moving away from the industry and culling layer chicken for meat.”
Sri Lanka’s chicken output collapsed 30 percent and eggs 40 percent, the All Island Poultry Association said three months later.
RELATED: Sri Lanka chicken, egg production plunge amid soft-peg collapse
Producers in Bolivia’s Cochabamba city had said chicken output had fallen by four million birds a month by December.
Sri Lanka’s chicken prices tripled close to 1,800 rupee a kilo before falling back to 1,100 levels, inclusive of tax, as the currency collapsed from 200 to 360 to the US dollar and appreciated back to below 300 to the US dollar amid deflationary policy.
Sri Lanka’s chicken prices are now about double the price before the currency collapse, though prices are stable.
In Bolivia beef and chicken prices had also rocketed, and more people were turning to chicken as it was cheaper industry officials said.
(Colombo/Dec24/2024)
