20/12/2006
The livestock industry of The Bahamas is facing a serious threat to its competitiveness stemming from the escalating prices of cereals, principally corn. Corn is a major component of manufactured animal feed for poultry and pork production.
Pork production in The Bahamas has declined significantly and the industry is virtually non-existent. Like the other "white meat", pork consumption remains high as a result of imported pork. The fresh pork market seems to have dried up among Bahamian consumers.
The poultry industry, on the other hand, is struggling to survive. The industry is staggering and is on the verge of collapsing due to three principle factors:
1. Dumping - Cheap poultry parts (leg quarters, wings and backs) are flooding the market. These parts are by-products of the breast market, which is the preferred part in the US market.
2. Market Access - In 2001 when the government of The Bahamas abruptly decreased the duty on poultry from 70% to 35%, this opened the floodgate for imports. This has seriously undermined local producers as parts are sold at a price, which is less than the cost of production.
3. Importers - Unscrupulous importers are utilizing under handed tactics to control the egg market. Presently the local egg producers are supplying the market at 95-96% self-sufficiency.
Importers are using the specialty egg product as a pretext to import foreign eggs hence contributing to the destabilization of the market.
It is this overall scenario which the poultry industry faces.
Poultry producers have invested huge sums of money in the industry. This is particularly the case of Bahamas Poultry in Grand Bahama. Bahamas Poultry is the largest single egg producer in CARICOM. Its egg operation is totally mechanized; this includes the production and processing units.
After hurricane Francis the management of Bahamas Poultry rebuilt the production units for broiler meat by investing some $3 million in new housing.
Prior to the closure of Gladstone Farms in 2001, the poultry agribusiness employed more than 500 workers of whom more than 50% were single mothers. At that time, the broiler production in The Bahamas accounted for 60-70% of the market. The decline in output and employment has been significant.
There needs to be a new policy direction to stabilize the industry, encourage investment and secure greater market share.
Broiler Production
Broiler product has seen some dramatic changes resulting from technological, nutritional and genetic advances. In the Caribbean tunnel utilization has enabled Caribbean producers to improve their competitiveness.
Over the past sixty-five (65) years, broiler performance on average has gone from 85 days for a 3 lbs bird ('40s) to a 5.6lb bird in 49.5 days ('05). These changes stem from the changes in nutrition as the broiler, genetically, has become an efficient converter of feed during this period. (See table)
Bahamas Poultry's investment in technology has caused it to keep abreast of these technological advances which are taking place in the global industry, specifically the U.S.
Market
There have been a major shift in consumer demand for broiler meat. The consumer has moved to a product which is convenient hence the changes in meeting the demand of the consumer. Bahamas Poultry has been a whole bird producer; however their recognition that the Bahamian consumer wants parts. In 2005, US producers processed 10% of its production for the whole bird market as the demand shifted to de-boned (40.9%) and tray pack (26.8%).
Retail grocery stores in the US account for 42% of the market and followed by restaurants with 26.1%. US export of broiler meat is expanding representing about 18% of its production. A substantial quantity of those exports, particularly to The Bahamas and other Caribbean islands, are leg quarters, wings and backs.
There is scope for growth of broiler production in The Bahamas; however producers like Bahamas Poultry are finding it difficult to survive in a market place where broiler by-products are being dumped and/or smuggled. Egg producers like Rainbow Farms and Sunshine Farms in New Providence are contemplating contraction as a result of the poor marketing environment. The industry is facing a serious dilemma.
