Fiji poultry sector to expand amid regional tensions
18 June 2012
According to industry representatives reported in the press, Fijian poultry production has increased from approximately 11 million chickens per annum in 2008 to over 15 million by 2012. In recent years, some 15 million Fiji dollars (approx. €6.5 million) has been invested in expansion of poultry production, with the Australian-owned Goodman Fielder International Fiji Ltd leading the way. Significantly, Goodman Fielder is not only looking to achieve self-sufficiency in poultry production in Fiji, but is also looking to develop exports to neighbouring Pacific Island Countries.
It should be noted in this context that the Papua New Guinea (PNG) Poultry Industry Association has welcomed the decision of the relevant authorities ‘to undertake a full review of fresh and frozen poultry imports’. This is seen as necessary on bio-security grounds in order to prevent a range of poultry diseases from which PNG is currently free. This decision followed the New Zealand ban on poultry imports from Australia following an outbreak of Newcastle Disease.
There is also a commercial dimension to government actions. In November 2011, PNG poultry producers complained that imported chicken from Australia ‘is killing the local industry’. The chairman of a newly opened chicken processing facility claimed that while they were not afraid of fair competition, Australia enjoyed major cost advantages when it came to feed supplies. He pointed out that while PNG has the potential to produce poultry-feed ingredients, this sector of the agricultural economy was underdeveloped.
Editorial comment
While the current review in PNG is nominally based on bio-security grounds, it needs to be seen against the background of recent complaints from PNG poultry producers about the commercial impact of cheap poultry meat imports.
Goodman Fielder investments in Fiji ‘to meet local and regional demands’ are in part linked to taking advantage of intra-Pacific island tariff preferences and trade opportunities under the PICTA Agreement and the Melanesian Spearhead Group Trade Agreement (see Agritrade article ‘ USDA publishes review of Timor-Leste poultry sector’, 9 August 2011). In industries as import-intensive as integrated poultry production systems, this raises important questions over rules of origin. For example, could rules of origin be structured in such a way as to encourage a progressively increasing level of local sources of poultry industry inputs, e.g. components of the required poultry feed?
In this context it should be noted that the Jamaican manufacturer of the iconic Red Stripe beer announced in May that it was to contract farmers to grow cassava and sorghum in order to reduce the import intensity of its beer production.
However, the feasibility of such import substitution comes down to the economics and contractual arrangements of producing these crops. Will the manufacturer, for example, provide subsidised extension and technical services to contracted farmers to facilitate production, productivity and regularity of supply? Will the farm-gate price be sufficiently competitive to prevent farmers selling to the relatively high-priced local food market? Will large tracts of suitable land be available?
It is possible that these constraints can be adequately addressed. However this may result in the consolidation of such poultry sector input industries into large-scale mechanised farming units, using high levels of fertiliser and farm chemicals with potentially serious environmental consequences, contrary to the climate-sensitive (greening) policies required globally.
