THE BROILER CHICKEN INDUSTRY IN PENINSULAR MALAYSIA STATUS OF THE INDUSTRY IN 2013 AND PROSPECTS FOR 2014

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1 THE BROILER CHICKEN INDUSTRY IN PENINSULAR MALAYSIA STATUS OF THE INDUSTRY IN 2013 AND PROSPECTS FOR 2014 SUMMARY stock accounted for 97.41% of the total In 2013, a production of million day-old chicks was reported by the industry and the production of broilers was million birds. For 2014, a production of million day-old chicks and million broilers is projected. There are 23 broiler parent stock companies with annual day-old chick production capacities ranging from 2.94 to million birds operating parent stock population. The monthly exfarm price of day-old chicks fluctuated between RM0.95 and RM1.80 per chick, with an annual average of RM1.33 per chick. The monthly ex-farm prices for broilers fluctuated between RM3.50 and RM5.50 per kilogram live weight with an annual average of RM4.74 per kilogram live weight. Cost of production of broilers was in The standing parent stock between RM4.45 and RM4.78 per kilogram population in 2013 was about 5.91 million birds. Cobbs and Ross are the principle live weight. Export of live broilers in 2013 was million birds showing a 14.6% breeds accounting for 93.2% of the total higher than the previous year. The parent stock. Other breeds are Arbor Acres importation of chicken meat in 2013 and Indian River. Locally produced parent increased by 7.4% from SURVEY METHODOLOGY AND DATA COLLECTION The survey of broiler breeding farms and hatcheries were conducted during the months of June, July and August During the survey, data and information were collected to prepare this report. The data was analyzed on a regional basis i.e Northern (Perlis, Kedah, Penang and Perak), Central (Selangor, Negeri Sembilan and Malacca), Southern (Johore) and East Coast (Pahang, Terengganu and Kelantan). BREEDER FARMS Number of Breeder Companies Twenty three (23) broiler parent stock companies of which ten (8) are integrators and 15 are nonintegrators with a total of 80 farms are in operation in the year 2013 (Table 1 and Table 2). 1

2 Table 1: Number of Broiler Parent Stock Companies Table 2: Distribution of Broiler Parent Stock Farms Region Number of Companies Northern (Perlis, Kedah, Penang and Perak) 8 Central (Selangor, N. Sembilan, and Malacca) 6 Southern (Johore) 6 Eastern (Pahang, Terengganu and Kelantan) 3 Production Capacity The annual production capacity of day-old chicks by the breeder companies varied. The smallest company produced about 4.51 million day-old chicks and the largest produced about million dayold chicks (Table 3). BROILER PARENT STOCK Standing Population The total standing parent stock population in June 2013 was 5.91 million birds and 6.48 million birds is projected for 2014 (Table 4). Total 23 Table 3: Annual Production Capacity of Broiler Parent Stock Companies Annual Production Capacity (million Chicks) State Number of Farms Perlis 0 Kedah 4 Penang 7 Perak 12 Selangor 3 Negeri Sembilan 11 Malacca 11 Johore 26 Pahang 2 Terengganu 1 Kelantan 3 Total 80 Number of Companies (2011 ) Number of Companies (2012 ) Number of Companies (2013 ) 1 to < to < to < to < to < to < > Total Table 4: Standing Parent Stock Population Companies (forecast) Integrators 3,891,308 4,071,804 4, ,967,216 Non-Integrators 1,448,322 1,589,088 1,518,047 1,517,305 Total 5,339,630 5,660,892 5,908,047 6,484,521 Breeds The breeds available and their market share in 2013 are as shown in Table 5. The principal breeds are Cobb and Ross, accounting for 93.2% percent of the total population. In 2013, most of the companies used the locally bred Cobbs and Ross (Table 6). 2

3 Table 5: Market Share of Individual Breeds of Broiler Parent Stock Breeds Cobb Ross Arbor Acres Indian River Hubbard 2014 (forecast) 3,806,380 4,176,346 4,358,402 4,940,652 1,312,480 1,290,105 1,149,154 1,167, , , , , ,440 6, Total 5,339,630 5,660,892 5,908,047 6,484,521 Emplacement of Day-Old Parent Stock Source of Day-Old Female Parent Stock Table 9 shows the number of companies using locally produced parent stock. In 2013, of the total day-old female parent stock emplaced, percent were supplied locally and 2.59 percent were imported (Table 10). Table 6: Use of Breeds by Broiler Parent Stock Companies Year Breed Cobb Ross Arbor Acres Indian River Hubbard Table 7: Annual Emplacement of Day-Old Female Parent Stock by Companies Companies Integrators 3,964,722 4,605,889 4,135,968 Number of Emplacement Day-old female parent stock emplacement were 5.33 million birds in the year 2013 as shown in Table 7. The emplacement of day-old parent stocks by integrators and the non-integrators were percent and percent respectively. The number of emplacement stock according to region and month are as shown in Table 8 and Table 11 respectively. Table 8: Annual Emplacement of Day-Old Female Parent Stock By Region Region Number of birds (million) Northern Central Southern Non Integrators 1,638,788 1,723,288 1,191,064 Total 5,603,510 6,329,177 5,327,032 East Coast Total

4 Table 9: Use of Locally Produced and Imported Female Parent Stock SUPPLY OF DAY OLD BROILER CHICKS. Breed Table 10: Sources of Day-Old Female Parent Stock by Broiler Parent Stock Companies (%) Table11: Monthly Emplacements of Day-old Female Parent Stock Month Number of Companies Local Imported Local Imported Cobb Ross Arbor Acres Indian River Source Malaysia U.S.A/Canada E.U Countries Indonesia, Korea, Japan, New Zealand Australia Number of Birds Source of Day-Old Broiler Chicks The number of day-old chicks produced by the integrators has decreased by 4.82 percent compared to the previous year whilst nonintegrators also show an increase by percent compared to Day Old Chicks Production The total day-old broiler chick production reported by the industry was 695,918,372 chicks as shown in Table 12. The weekly production ranged from million to million chicks. The supply of day-old broiler chicks is projected to be about 706,193,149 chicks for 2014 (Table 17). In 2013, the integrators and non-integrators contributed 72.97% and 27.03% respectively of the total day-old broiler chicks production (Table 14). Table 14: Production of Day-old Broilers Chicks by Integrators And Non-Integrators January 370, , ,298 Year Integrators (%) Non-integrators (%) February 544, , ,452 March 438, , ,043 April 512, , ,912 May 597, , ,374 June 352, , ,841 July 449, , ,710 August 462, , ,853 September 478, , ,069 October 523, , ,680 November 511, , ,670 December 360, , , Prices of Day-Old Chicks The weekly price of day old chicks fluctuated from RM0.95 to RM1.80 per chick. The annual average price was RM1.33 per chick. Total 5,603,510 6,329,177 5,327,032 4

5 Supply of Day-old Broiler Chick in Peninsular Malaysia 2013 ( Survey Reported) Date end of week Weekly Output 7-Jan-13 11,666, Jan-13 12,344, Jan-13 12,661, Jan-13 13,026,215 4-Feb-13 13,151, Feb-13 13,312, Feb-13 13,332, Feb-13 13,334,772 4-Mar-13 13,373, Mar-13 13,109, Mar-13 13,100, Mar-13 12,918,879 1-Apr-13 12,969,219 8-Apr-13 13,260, Apr-13 13,273, Apr-13 13,058, Apr-13 13,061,165 6-May-13 13,049, May-13 13,367, May-13 13,256, May-13 13,304,708 3-Jun-13 13,462, Jun-13 13,516, Jun-13 13,527, Jun-13 13,697,225 1-Jul-13 13,847,553 8-Jul-13 14,048, Jul-13 14,009, Jul-13 14,182, Jul-13 14,289,880 5-Aug-13 14,275, Aug-13 14,282, Aug-13 14,323, Aug-13 14,386,807 2-Sep-13 15,350,482 9-Sep-13 14,343, Sep-13 14,373, Sep-13 14,152, Sep-13 13,801,840 7-Oct-13 13,716, Oct-13 13,627, Oct-13 13,318, Oct-13 13,150,035 4-Nov-13 13,128, Nov-13 12,684, Nov-13 12,579, Nov-13 12,681,955 2-Dec-13 12,635,190 9-Dec-13 12,508, Dec-13 12,582, Dec-13 13,216, Dec-13 12,283,345 Total 695,918,372 Table 12 Supply of Broiler Chicken in Peninsular Malaysia 2013 ( Survey Reported) Date end of week Weekly Output 7-Jan-13 11,107, Jan-13 11,280, Jan-13 11,381, Jan-13 11,134,681 4-Feb-13 11,134, Feb-13 11,083, Feb-13 11,727, Feb-13 12,027,992 4-Mar-13 12,374, Mar-13 12,493, Mar-13 12,647, Mar-13 12,665,607 1-Apr-13 12,668,033 8-Apr-13 12,705, Apr-13 12,453, Apr-13 12,445, Apr-13 12,272,935 6-May-13 12,320, May-13 12,597, May-13 12,610, May-13 12,405,210 3-Jun-13 12,408, Jun-13 12,397, Jun-13 12,699, Jun-13 12,593,622 1-Jul-13 12,639,473 8-Jul-13 12,789, Jul-13 12,840, Jul-13 12,851, Jul-13 13,012,364 5-Aug-13 13,155, Aug-13 13,346, Aug-13 13,308, Aug-13 13,473,575 2-Sep-13 13,575,386 9-Sep-13 13,562, Sep-13 13,568, Sep-13 13,607, Sep-13 13,667,467 7-Oct-13 14,582, Oct-13 13,625, Oct-13 13,655, Oct-13 13,444,772 4-Nov-13 13,111, Nov-13 13,030, Nov-13 12,945, Nov-13 12,652,921 2-Dec-13 12,492,533 9-Dec-13 12,472, Dec-13 12,050, Dec-13 11,950, Dec-13 12,047,857 Total 657,095,676 Table 13 5

6 Supply of Day-old Broiler Chick in Peninsular Malaysia 2014 ( Forecast Survey Reported) Date end of week Weekly Output 7-Jan-14 12,029, Jan-14 12,072, Jan-14 12,200, Jan-14 12,416,925 4-Feb-14 12,474, Feb-14 12,601, Feb-14 12,568, Feb-14 12,529,734 4-Mar-14 12,673, Mar-14 12,626, Mar-14 12,625, Mar-14 12,612,649 1-Apr-14 12,520,406 8-Apr-14 12,691, Apr-14 12,513, Apr-14 12,587, Apr-14 12,302,939 6-May-14 12,563, May-14 12,816, May-14 12,939, May-14 12,942,388 3-Jun-14 12,990, Jun-14 13,201, Jun-14 13,257, Jun-14 13,262,548 1-Jul-14 13,438,448 8-Jul-14 13,707, Jul-14 13,724, Jul-14 13,991, Jul-14 14,073,109 5-Aug-14 13,960, Aug-14 14,154, Aug-14 14,233, Aug-14 14,183,112 2-Sep-14 14,168,447 9-Sep-14 14,568, Sep-14 14,524, Sep-14 14,336, Sep-14 14,516,527 7-Oct-14 14,697, Oct-14 14,504, Oct-14 14,645, Oct-14 14,728,170 4-Nov-14 14,923, Nov-14 14,990, Nov-14 15,036, Nov-14 15,002,987 2-Dec-14 14,830,091 9-Dec-14 15,010, Dec-14 14,763, Dec-14 14,614, Dec-14 14,843,551 Total 706,193,149 Table 17 Supply of Broiler Chicken in Peninsular Malaysia 2014 ( Forecast Survey Reported) Date end of week Weekly Output 7-Jan-14 12,003, Jan-14 11,883, Jan-14 11,953, Jan-14 12,555,986 4-Feb-14 11,669, Feb-14 11,428, Feb-14 11,469, Feb-14 11,590,519 4-Mar-14 11,796, Mar-14 11,850, Mar-14 11,971, Mar-14 11,940,028 1-Apr-14 11,903,247 8-Apr-14 12,039, Apr-14 11,995, Apr-14 11,994, Apr-14 11,982,017 6-May-14 11,894, May-14 12,056, May-14 11,888, May-14 11,957,855 3-Jun-14 11,687, Jun-14 11,935, Jun-14 12,175, Jun-14 12,292,115 1-Jul-14 12,295,269 8-Jul-14 12,340, Jul-14 12,541, Jul-14 12,594, Jul-14 12,599,421 5-Aug-14 12,766, Aug-14 13,022, Aug-14 13,037, Aug-14 13,291,733 2-Sep-14 13,369,454 9-Sep-14 13,262, Sep-14 13,446, Sep-14 13,521, Sep-14 13,473,956 7-Oct-14 13,460, Oct-14 13,840, Oct-14 13,797, Oct-14 13,619,635 4-Nov-14 13,790, Nov-14 13,962, Nov-14 13,779, Nov-14 13,913,531 2-Dec-14 13,991,762 9-Dec-14 14,177, Dec-14 14,240, Dec-14 14,284, Dec-14 14,252,838 Total 660,589,830 Table 18 6

7 SUPPLY OF BROILERS IN 2013 AND FORECAST FOR 2014 Production of Broilers In 2013, the total production of broilers was million birds with a weekly production ranging from million birds to million birds (Table 13). The average daily output was 1.80 million birds with an increase of 2.85 Price of Broilers The weekly ex-farm price of live broilers fluctuated in the range of RM3.50 to RM5.50 per kilogram live weight. The annual average ex-farm price for the year was RM 4.74 per kilogram live weight. percent compared to The production of broilers for 2014 is projected to be about million birds with an average daily production of 1.81 million birds (Table 18). Cost of Production Cost of production of broilers ranged from RM4.45 to RM4.78 per kilogram live weight. The annual average cost of production was Export Of Broilers and Chicken Meat A total of million live broilers and 9,710 metric tons of raw and marinated chicken meat about RM4.61 per kilogram live weight. The high cost was attributed to the high cost of feed and raw feed materials. were exported in 2013 (Table 15 and Table 16). Table 15: Export of Live Broiler and Chicken Meat Year Live Broilers (million birds) Chicken Meat ( 000 m tons) Import Of Chicken Meat Importation of various chicken meat in 2013 was million kilograms. The imports increased by 7.4% compared to 2012 (Table 19). Table 16: Export of Live Broiler Chicken by Month Month January 4,655,695 4,197,864 4,258,262 February 2,900,869 3,667,556 3,650,333 March 3,794,058 3,973,309 3,799,887 April 3,810,970 3,709,280 3,859,451 May 3,746,678 3,767,867 3,879,386 June 3,668,925 3,693,616 3,727,058 July 3,924,527 3,680,950 4,444,478 August 4,213,649 4,085,780 4,627,236 September 3,806,879 3,521,954 4,017,236 October 3,928,208 4,156,064 4,405,228 November 3,651,395 4,014,669 3,941,577 December 3,971, ,152 4,419,933 Total 46,073,504 42,778,091 49,030,065 7

8 Table 19: Importation of chicken meat by month (kg.) FEED PRICES Month January 3,394,880 2,774,476 3,358,079 February 1,645,664 4,584,129 2,123,575 March 2,032,538 4,065,717 3,342,191 April 3,317,016 3,613,897 5,813,191 May 3,589,003 3,134,990 2,088,781 June 4,002,419 3,941,260 2,182,44 July 2,753,960 3,461,942 3,981,137 August 3,252,573 2,951,886 5,755,49 September 3,964,273 3,190,956 5,184,279 October 3,303,012 3,045,550 4,384,431 November 3,509,290 3,574,706 3,553,777 December 4,685,080 2,928,671 2,548,85 Total 39,449,712 41,268,184 44,316,769 Note : Figures are based on import permits issued by DVS Table 20: Source of Imported Chicken Meat (%) Source China Thailand Denmark USA Holland France Sabah Sarawak Note: Figures are based on import permits issued by DVS The price of broiler feeds were lower compared to 2012 with an average decrease of 1.18%. Table 21 & 22 shows the price of broiler feeds in 2012 and Table 21: Broiler Feed Prices 2012/2013 Month Price ( RM / Mt ) January February March April May June July August September October November December Average 1,773 1,751 The annual average price of the broiler starter and broiler finisher feed in 2013 are as shown in Table 21. Most of the chicken meat was imported from China which amounted to metric tons, followed by Thailand, Denmark and Holland (Table 20). 8

9 Table 22: Price of Broiler Starter and Finisher Feed Price Month ( RM / 50kg ) Starter Finisher January February March April May June July August September October November December Average DISCUSSION In 2013, there are many issues facing the poultry industry, such as increment in importation of chicken cuts and products, strengthening market access towards export excellence, continuous increase of chicken prices, etc. The figure reported has shown that the importation of chicken cuts and products increased by about 7.4 percent compared to year Such imports are likely to jeopardize the viability and sustainability of the local industry which is already suffering from prolonged high cost of production. Since the local sources are more than adequate to supply the local requirements (about 128% of self sufficiency level for chicken/duck meat), the poultry industry has to innovate and explore export markets especially among ASEAN members in the true spirit of ASEAN Free Trade Agreement (AFTA). CONCLUSION In Malaysia, the livestock industry is dominated by the poultry industry which supplies more than 80 percent of the total meat requirements of the country. This industry is regarded as the most successful segment of the livestock sector and perhaps has the highest output value per worker in the agriculture sector. Malaysia has one of the highest per capita consumption of chicken in the world. Per capita consumption of chicken/duck meat is about 38kg (2013). Chicken meat is the most popular and cheapest source of meat protein among Malaysians, largely because there are no dietary prohibitions or religious restrictions against chicken consumption. Over the years, quick service restaurants (QSR) such as Kentucky Fried Chicken (KFC), McDonald s, A & W, Kenny Rogers, Nando s Chickenland (a South-African based chain) have propelled the growth of chicken consumption in Malaysia. Malaysian consumers today demands safe and high quality food at a reasonable price from the industry. They are very sensitive towards issues arising out of food safety and halal matters. It is important to note that the majority of the Muslim consumers will not accept poultry products that are not certified halal by the Malaysian religious authority. The Malaysian consumers are also price-sensitive and look for valve-for-money products. The 9

10 poultry industry is increasingly challenged to produce new innovative products at lower costs without compromising on the quality. ACKNOWLEDGEMENT The authors wish to thank Y. Bhg. Dato Dr Azmie Bin Zakaria, Director General of the Department of Veterinary Services, Malaysia for his permission to publish this report. Sincere gratitude and appreciation is extended to Dr Abu Hassan Bin Muhammad Ali, Director of Livestock Commodity Development Division, Dr. Hjh. Roslaini Binti Hj. Rusli, Dr. Wan Mohd Kamil bin Dato Wan Nik and Dr. Lim Yoke Sin for their invaluable advice and guidance. The kind co-operation and assistance from the officers of the Headquarters and the State Department of Veterinary Services as well as the Management of all Poultry Breeding Companies involved in this survey are gratefully acknowledged. 10

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