AlaskaDenise
In Memoriam
<TABLE><TBODY><TR><TD></TD></TR><TR><TD>
</TD></TR><TR><TD>Ismat Sabir
</TD></TR><TR><TD>The State Bank of Pakistan (SBP) has announced guidelines for poultry financing. The SBP report said the poultry sector has a vital role in the agricultural sector and there is vast potential to invest in the poultry industry, since the per capita consumption of poultry meat is increasing at the rate of four percent per annum. The disbursement of credit to this sector during 2006-07 was only Rs. 12.9 billion or 7.6 percent of total agricultural loans of Rs 169 billion disbursed during the year. It said one of the main reasons for low disbursements to the poultry sector was lack of awareness and no familiarity of commercial banks with the sector. Therefore, for capacity building of banks, major classification of the sector along with guidelines for financing the poultry sector have been developed by the SBP in consultation with banks, MINFAL, Pakistan Poultry Association and other stakeholders.
Pakistan?s economy witnessed a moderate recovery during FY07 with real GDP growth reaching the 7.0 percent target, as compared with 6.6 percent in 2006. This was the fourth year of average annual growth rate of 7.0 percent, 2003-07. The agricultural sector as a whole recovered in FY07 primarily due to improved performance of cropping and the growth of the livestock sub-sector. The value-addition in the livestock sub-sector grew by 4.3 percent, which was the second highest increase in the decade, exceeded by only the exceptional rise of 7.6 percent in 2006.
Poultry is an important sub-sector of livestock. It has great potential and can play a significant role in the national economy by contributing towards food security of the country, reducing pressure on the demand for mutton and beef, and earning foreign exchange. Poultry?s contribution to meat production was 20 percent. It is a good source of cheap, palatable and nutritious food protein. Poultry has around 1.1 percent share in the national GDP, 4.8 percent in the agricultural GDP, and around 1.5 million people are connected with this field.
The poultry industry can broadly be divided into hatchery, poultry farming and the feed sector. Poultry produce is being developed through commercial and rural poultry farming. The commercial poultry farming sector is a classic example of private sector enterprise with a phenomenal growth of 40 to 50 percent per annum. The government is providing incentives to the poultry sector for growth in the form of duty-free import of poultry vaccines, feed additives and coccidiostats used in poultry feed. In the Avian influenza affected areas, about 12 laboratories have been set up, along with a central laboratory in Islamabad,. In addition to this, special poultry zones are being established and the government has given incentives to Thai investment CP Group to establish breeder farms and feed mills in the country.
The incentives have resulted in the establishment of infrastructure comprising 285 hatcheries with a capacity to produce 600 million day-old chicks per annum, 141 feed mills with a capacity of producing 4.7 million tonnes of compound food per annum, and 19,154 poultry farms with the capacity of producing 100 million broilers.
The hatchery sector is the backbone of poultry farming as it provides day-old chicks to poultry farms. A hatchery is a place where eggs are placed in incubators for 21 days and day-old chicks sold to the farming sector. Establishing a hatchery requires huge investment as compared to other sub-sectors of poultry. It needs the purchasing of quality imported incubators ranging in cost between Rs. 1.5 million to Rs. 3.0 million. Although relatively cheap locally manufactured incubators are available in the market, their efficiency is low. Small hatcheries can be established with one to two incubators, medium hatcheries comprise three to 20 incubators, while large hatcheries consist of more than 20 incubators.
Rearing of poultry birds or chicks for meat and eggs is classified as poultry farming. The investment required for establishing a poultry farm is quite low as compared to other sub-sectors of poultry. However, it is labour intensive and requires investment for working capital mainly for the purchase of feed, chicks, vaccinations and payments to labour. Poultry farming can further be classified into the following three categories.
In breeder farming, eggs are used in hatcheries to produce broiler and layer chicks coming from the parent flock of selected breeds and farming of such breeds for the production of eggs. Breeder farms require relatively high levels of investment for the import of parent grandparent or flock of best breed and farmers need to have better technical skills and know-how as compared to other sub-sectors of poultry farming.
In layer farming, birds are raised for the purpose of egg production. These birds produce eggs for normal consumption. One layer bird in a year produces 250 to 280 table eggs under average management conditions. For the first 16 weeks the farmer needs to spend money on feed and maintenance and receives no return on his investment during this period. For the next 10 to 12 weeks, however, the total running expenses incurred are recovered and the farmer starts making profit after six months.
The most common form of poultry farming is broiler farming in which day-old chicks are reared for meat. As compared to other sub-sectors of poultry farming, this process requires low level of investment and technical know-how. The usual practice is to buy day-old chicks and feed them for six to eight weeks before selling them. A typical table meat bird weighs nearly 2 to 2.5 kg and consumes feed of about four kg.
The poultry sector has faced the problem of avian influenza outbreaks in 2006 in broiler, layer and breeder poultry farms, which affected 66 farms involving approximately 280,000 birds. The resurgence of disease occurred in February 2007 in backyard poultry, zoo and commercial poultry in Rawalpindi, Islamabad, Abbottabad and Mansehra. As part of the international obligation, the occurrence was notified and the National Contingency Plant was activated to increase surveillance for the disease.
A project amounting to Rs. 40 million is under implementation to strengthen the surveillance and emergency preparedness for Avian Influenza. Moreover, an umbrella project of Rs. 1180.142 million is being prepared for which negotiations with the World Bank ($ 500 million) are going on. The new policy will bring radical changes in the current livestock production system as it provided incentives such as:
Import of agro-based machinery and equipment used in the livestock sector, and not manufactured locally, has been allowed. In addition, poultry vaccines, feed additives, coccidiostats used in poultry feed manufacturing has been allowed at zero percent custom duty.
Exclusive incentives for the poultry sector: In view of the importance of the poultry industry to the economy and to exploit its untapped potential, the SBP has formulated guidelines to enhance flow of formal credit to the poultry sector. These guidelines are aimed at assisting and facilitating banks to penetrate into the poultry sector by rigorously financing poultry-related activities.
The main objective of the guidelines is to facilitate banks in developing internal expertise and products for poultry financing, and encourage and facilitate the financial sector to provide needed working capital and term finance to the poultry sector. The farmers would be encouraged to adopt modern and efficient poultry farming techniques. The SBP will encourage increasing poultry meat, poultry food production for local consumption, and the export of poultry meat and poultry food and its processed products.
Individuals and all types of legal entities engaged in poultry-related activities or desirous of establishing new broiler, breeder, hatcheries or layer farms having sufficient knowledge and relevant experience are eligible to draw loans under poultry farming. The agriculture financing will not include loans to traders and intermediaries engaged in trading or processing of agriculture commodities. Such lending would fall under corporate, commercial banking or SME financing. However, agricultural financing can be extended to entities (including corporate firms, partnerships, and individuals) engaged in farming activity as well as processing, packaging and marketing of 75 percent of their own agricultural produce. Financing facilities may be extended provided the bank is satisfied with the capacity of the borrower/sponsor to manage and run the farm. The SBP advised the bank that it should have detailed understanding and information about the borrower.
Poultry farmers need financing facilities for daily expenses, i.e. working capital requirement and long term investment for purchase of incubators, generators and feeding lines machinery, farm equipments and construction of sheds, etc., and the guidelines cover both types of financing.
The limit of loan amount may be assessed by the bank on the basis of the financing request, appraisal or feasibility report. Banks will determine mark up as per instructions. The poultry stock and equipment should be comprehensively insured from reputed insurance companies or groups of companies. This would also cover the risk of avian influenza.
</TD></TR></TBODY></TABLE>
.
</TD></TR><TR><TD>Ismat Sabir
</TD></TR><TR><TD>The State Bank of Pakistan (SBP) has announced guidelines for poultry financing. The SBP report said the poultry sector has a vital role in the agricultural sector and there is vast potential to invest in the poultry industry, since the per capita consumption of poultry meat is increasing at the rate of four percent per annum. The disbursement of credit to this sector during 2006-07 was only Rs. 12.9 billion or 7.6 percent of total agricultural loans of Rs 169 billion disbursed during the year. It said one of the main reasons for low disbursements to the poultry sector was lack of awareness and no familiarity of commercial banks with the sector. Therefore, for capacity building of banks, major classification of the sector along with guidelines for financing the poultry sector have been developed by the SBP in consultation with banks, MINFAL, Pakistan Poultry Association and other stakeholders.
Pakistan?s economy witnessed a moderate recovery during FY07 with real GDP growth reaching the 7.0 percent target, as compared with 6.6 percent in 2006. This was the fourth year of average annual growth rate of 7.0 percent, 2003-07. The agricultural sector as a whole recovered in FY07 primarily due to improved performance of cropping and the growth of the livestock sub-sector. The value-addition in the livestock sub-sector grew by 4.3 percent, which was the second highest increase in the decade, exceeded by only the exceptional rise of 7.6 percent in 2006.
Poultry is an important sub-sector of livestock. It has great potential and can play a significant role in the national economy by contributing towards food security of the country, reducing pressure on the demand for mutton and beef, and earning foreign exchange. Poultry?s contribution to meat production was 20 percent. It is a good source of cheap, palatable and nutritious food protein. Poultry has around 1.1 percent share in the national GDP, 4.8 percent in the agricultural GDP, and around 1.5 million people are connected with this field.
The poultry industry can broadly be divided into hatchery, poultry farming and the feed sector. Poultry produce is being developed through commercial and rural poultry farming. The commercial poultry farming sector is a classic example of private sector enterprise with a phenomenal growth of 40 to 50 percent per annum. The government is providing incentives to the poultry sector for growth in the form of duty-free import of poultry vaccines, feed additives and coccidiostats used in poultry feed. In the Avian influenza affected areas, about 12 laboratories have been set up, along with a central laboratory in Islamabad,. In addition to this, special poultry zones are being established and the government has given incentives to Thai investment CP Group to establish breeder farms and feed mills in the country.
The incentives have resulted in the establishment of infrastructure comprising 285 hatcheries with a capacity to produce 600 million day-old chicks per annum, 141 feed mills with a capacity of producing 4.7 million tonnes of compound food per annum, and 19,154 poultry farms with the capacity of producing 100 million broilers.
The hatchery sector is the backbone of poultry farming as it provides day-old chicks to poultry farms. A hatchery is a place where eggs are placed in incubators for 21 days and day-old chicks sold to the farming sector. Establishing a hatchery requires huge investment as compared to other sub-sectors of poultry. It needs the purchasing of quality imported incubators ranging in cost between Rs. 1.5 million to Rs. 3.0 million. Although relatively cheap locally manufactured incubators are available in the market, their efficiency is low. Small hatcheries can be established with one to two incubators, medium hatcheries comprise three to 20 incubators, while large hatcheries consist of more than 20 incubators.
Rearing of poultry birds or chicks for meat and eggs is classified as poultry farming. The investment required for establishing a poultry farm is quite low as compared to other sub-sectors of poultry. However, it is labour intensive and requires investment for working capital mainly for the purchase of feed, chicks, vaccinations and payments to labour. Poultry farming can further be classified into the following three categories.
In breeder farming, eggs are used in hatcheries to produce broiler and layer chicks coming from the parent flock of selected breeds and farming of such breeds for the production of eggs. Breeder farms require relatively high levels of investment for the import of parent grandparent or flock of best breed and farmers need to have better technical skills and know-how as compared to other sub-sectors of poultry farming.
In layer farming, birds are raised for the purpose of egg production. These birds produce eggs for normal consumption. One layer bird in a year produces 250 to 280 table eggs under average management conditions. For the first 16 weeks the farmer needs to spend money on feed and maintenance and receives no return on his investment during this period. For the next 10 to 12 weeks, however, the total running expenses incurred are recovered and the farmer starts making profit after six months.
The most common form of poultry farming is broiler farming in which day-old chicks are reared for meat. As compared to other sub-sectors of poultry farming, this process requires low level of investment and technical know-how. The usual practice is to buy day-old chicks and feed them for six to eight weeks before selling them. A typical table meat bird weighs nearly 2 to 2.5 kg and consumes feed of about four kg.
The poultry sector has faced the problem of avian influenza outbreaks in 2006 in broiler, layer and breeder poultry farms, which affected 66 farms involving approximately 280,000 birds. The resurgence of disease occurred in February 2007 in backyard poultry, zoo and commercial poultry in Rawalpindi, Islamabad, Abbottabad and Mansehra. As part of the international obligation, the occurrence was notified and the National Contingency Plant was activated to increase surveillance for the disease.
A project amounting to Rs. 40 million is under implementation to strengthen the surveillance and emergency preparedness for Avian Influenza. Moreover, an umbrella project of Rs. 1180.142 million is being prepared for which negotiations with the World Bank ($ 500 million) are going on. The new policy will bring radical changes in the current livestock production system as it provided incentives such as:
Import of agro-based machinery and equipment used in the livestock sector, and not manufactured locally, has been allowed. In addition, poultry vaccines, feed additives, coccidiostats used in poultry feed manufacturing has been allowed at zero percent custom duty.
Exclusive incentives for the poultry sector: In view of the importance of the poultry industry to the economy and to exploit its untapped potential, the SBP has formulated guidelines to enhance flow of formal credit to the poultry sector. These guidelines are aimed at assisting and facilitating banks to penetrate into the poultry sector by rigorously financing poultry-related activities.
The main objective of the guidelines is to facilitate banks in developing internal expertise and products for poultry financing, and encourage and facilitate the financial sector to provide needed working capital and term finance to the poultry sector. The farmers would be encouraged to adopt modern and efficient poultry farming techniques. The SBP will encourage increasing poultry meat, poultry food production for local consumption, and the export of poultry meat and poultry food and its processed products.
Individuals and all types of legal entities engaged in poultry-related activities or desirous of establishing new broiler, breeder, hatcheries or layer farms having sufficient knowledge and relevant experience are eligible to draw loans under poultry farming. The agriculture financing will not include loans to traders and intermediaries engaged in trading or processing of agriculture commodities. Such lending would fall under corporate, commercial banking or SME financing. However, agricultural financing can be extended to entities (including corporate firms, partnerships, and individuals) engaged in farming activity as well as processing, packaging and marketing of 75 percent of their own agricultural produce. Financing facilities may be extended provided the bank is satisfied with the capacity of the borrower/sponsor to manage and run the farm. The SBP advised the bank that it should have detailed understanding and information about the borrower.
Poultry farmers need financing facilities for daily expenses, i.e. working capital requirement and long term investment for purchase of incubators, generators and feeding lines machinery, farm equipments and construction of sheds, etc., and the guidelines cover both types of financing.
The limit of loan amount may be assessed by the bank on the basis of the financing request, appraisal or feasibility report. Banks will determine mark up as per instructions. The poultry stock and equipment should be comprehensively insured from reputed insurance companies or groups of companies. This would also cover the risk of avian influenza.
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