Research Studies completed
i). A Value Chain Analysis of the Meat Sector in Pakistan
 Meat value chain is comprised of five segments namely “Inputs”, “Production of Meat
Animal”, “Marketing of Meat Animals”, “Processing (Slaughtering)” and “Meat Distribution
(Domestic and Export Markets)”.
 “Inputs” 1st segment includes genetic (breeds of meat animals), feed (green, dry fodders,
concentrates and pastures) and veterinary services (medicine, vaccination and artificial
insemination). There are transboundry breeds namely Sahiwal and Thari cattles, Nili Ravi
buffaloes and Beetal goats. There are no beef breeds of cattle in Pakistan and therefore
beef is at best a by-product. Haphazard breeding is prevailing along with traditional
unscientific management that is compounded by the low genetic ceiling of the livestock.
Fodder availability/adult animal unit has declined 1.5 ton from 1996 to 0.80 ton in 2006.
Likewise wheat straw availability per adult animal unit has declined from 0.323 ton in 1996
to 0.307 ton in 2006.
 Concentrates availability per adult animal unit has declined from 0.04 ton in 1996 to 0.036
ton in 2006. Rangeland per adult animal unit – small ruminants is only 4.76 ha/annum – low
productivity of rangeland due to over grazing and exploitation. During the current era these
children prefer to go for daily wage work rather than grazing and grass cutting due to social
status of herders. The decline in feed resulted to high cost of feeds. Number of nomadic
from Afghanistan has also disappeared due to war and terror. Such decline of availability for
green and dry fodders and concentrates overtime led to poor and inadequate nutrition
which resulted in low animal productivity. Large and small ruminants are performing much
below their genetic potential due to poor and inadequate nutrition which lead to
compounded by the low genetic ceiling of livestock.
 The availability of veterinary services (a veterinary hospital, a veterinary dispensary and a
artificial insemination centre is available for 86575, 13852 and 69260 adult animals unit
respectively during 2006 Livestock Census. A veterinary professional and a sub-professional
is available for 34630 and 13852 adult animal unit during 2006 livestock census) is limited
due to which high disease and high mortality are occurring. The veterinary medicines are
also very expensive in the view of livestock and level of farmer’s satisfaction is poor.
 The binding constraints/obstacles facing first segment of meat value chain are (i) haphazard
breeding and traditional unscientific management (ii) the decline of availability for green
and dry fodders, concentrates and pasture overtime led to poor and inadequate nutrition (iii)
limited availability of veterinary services and expensive medicines, livestock herders are
using at low level of veterinary services (iv) earlier, the children of small farmers were
involved in grazing animal and cutting of grasses for animal. During the current era these
children prefer to go for daily wage work rather than grazing and grass cutting due to social
status. Due to limited availability of genetics, feed and veterinary services along with
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expensive medicines, livestock herders and flock owners are using these at low level
resulting poor management and productivity of meat animals in the country.
Under the “Production of Meat Animals” segment of value chain, meat animals produced
were 24.493 million heads with a value of Rs.266.557 billion during 2008-09 in the country.
Out of which beef animals were 7.673 million heads with a value of Rs.173.5965 billion
including cattle (3.973 million heads with a value of Rs.93.172 billion) and buffaloes (3.676
million heads with a value of Rs.79.6245 billion). The mutton animals (sheep and goats)
were 16.82 million heads with a value of Rs.92.960 billion including sheep (4.8993 million
heads with a value of Rs.36.0768 billion) and goat (11.927 million heads with a value of
Rs.56.8834 billion). Analysis of cost of production of large ruminants at feed lot farming
revealed that farmers are earning net income of Rs.436/- per animal. Similarly, cost of
production of small ruminants with feed lot farming revealed that farmers are earning net
income of Rs.103/- per animal. This implies that feed lot farming (raising beef and mutton
animals) with concentrate to bring them to slaughter weight and feed lot farming is
profitable enterprise. A portion of meat sub-sector is made up of dairy meat and mutton
that comes from in-milking cows and buffaloes, female sheep and female goats culled from
dairy herds because for age and other reasons, they are not productive for dairy purposes
and reproductive potential.
The major factors contributing towards low productivity are (i) weak and unhealthy stock
and breeding lines because no beef breeds of cattle (ii) no concept of herd health
management (iii) low output due to low input system (iv) raising meat animal with
traditional system is not profitable enterprise and (v) social system has broken due to
inflation and ag-inflation is even higher. All these factors translate into a existing very weak
livestock extension services in the country.
Under “Marketing of Meat Animals” segment of value chain, meat animals marketed was
24.493 million heads during 2008-09 which includes domestic marketing (24.495 m.h) and
animal exported (33477 with a export value of Rs.309.01 million). Traditional farmers, feed
lot fattening farmers and exporter own farm marketed 23.764, 0.514, and 0.220 million
heads were marketed respectively during 2009. Meat animals were marketed through five
channels. Channel-1 includes farmer to beopari (80%), farmer to live animal market (5%),
and farmer to rural butcher (15%). Channel-2 deals with beopari to live animal market
(98%), and beopair to rural butcher (2%). Channel-3 includes animal market to contractors
(52%), animal market to traveler traders (15%), animal market to urban butcher (31%), and
animal market to rural butcher (2%). Channel-4 includes contractor to traveler traders
(27%), contractor to exporters (1%), and contractor to urban butcher (72%). Channel-5
includes traveler trader to slaughter house (16%), and traveler trader to urban butcher
(84%).
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On the marketing side, the livestock markets are suffered from shortage of basic facilities
like watering, shelter, feed and fodder. A number of other arrangements like
loading/unloading, communication, services of veterinary doctor, weighing, market
boundaries etc. are absent despite 3-5 percent commission is charged as market fee in
Punjab whereas in other provinces various practices are followed. The contract money of
these markets is not invested back for provision of such facilities. But the most crucial
aspect of the marketing system constraining meat development is the sale of animal on per
head basis and not on their live weight basis. This militates against the success of any meat
development program. The meat production is entirely in the private sector. Delay in live
animal delivery is due to non-availability of specific transport and overloading without
refrigeration. However, the government intervention in fixing the price at the retail end is
neither rational nor fair. It makes the situation worse because this retail price fixation is not
applied to the corporate sector.
The binding constraints of this segment of meat value chain are (i) inadequate basic facilities
at live animals market (watering, shelter, feed and fodder, absence of weighing machine
and market committee) (ii) non-availability of specific transport and overloading without
refrigeration (iii) delay in live animal delivery and (iv) faulty pricing mechanism of meat
animals (per head basis rather than weight basis).
Under “Meat Production” segment of value chain, total meat produced during 2008-09 was
2.192 million ton by slaughtering 24.493 million heads of meat animals. Total beef
production originates from beef animals produced by general farmers slaughtered (1.187
million tons), feed lots (0.016 million tons) and Eid-ul-Azha (0.40 million tones). Similarly,
total mutton production comes from mutton animals produced by general farmers
slaughtered (0.341 million tons), feed lots (0.012 million tons) and Eid-ul-Azha (0.236 million
tones). The estimated meat production for the year 2008-09 in Pakistan is 2.192 million
tones. Out of this 1.603 and 0.588 m. tones are beef and mutton respectively. The
production of cattle, buffalo and camel beef was 0.638, 0.543 and 0.006 m. tones
respectively. Production of mutton from sheep and goat was 0.588 million tons. The overall
productivity of all the species in terms of meat is low. The overall increase in meat over the
years was due to the increased inventory and not because of any increase in their
productivity.
The binding constraints of this part of meat value chain are (i) abattoirs in disrepair with
limited current expenditure (ii) small number of regulated slaughterhouses (iii) Abattoirs
have rudimentary disposal system of byproducts (iv) limited private sector participation (v)
code of practice not operational (vi) weak ante mortem and post mortem inspection (vii) no
chilling facilities except in few private abattoirs and (viii) no veterinary and plant health
authority (ix) because of fixing the price of meat by the tehsil municipal administration, the
slaughtering of weak, diseased and old animals is very common (x) absence of meat grading
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and pricing (affecting meat quality) (xi) illegal slaughtering (xii) lack of specialized skills in
flaying and meat handling and un-hygienic meat transportation are serious concerns in the
meat production chain
Under “Meat Marketing” segment of value chain, the total meat marketed during 2008-09
was 2.192 million ton out of which beef and mutton were 1.603 and 0.588 million ton
respectively. The meat marketed from recognized slaughter house to domestic market was
1.097 million ton (49%) which includes beef (0.782 m.t) and mutton (0.285 m.t). The meat
marketed from urban butcher to domestic markets was 0.653 million ton (30%) which
includes beef (0.479 m.t) and mutton (0.174 m.t). The meat marketed from rural butchers
was 0.457 m.t. which includes beef (0.335 m.t) and mutton (0.122 m.t).
The meat marketing channels observed are as under: (i) from recognized slaughter houses
to wholesaler (30%) and retailers/butchers (70%) (ii) wholesalers to retailers (90%), hotel
and restaurants (5%), food services and suppliers (3%) and super markets (2%) (iii) retailers
to consumers (100%) (iv) urban butchers to consumers (93%), food suppliers (3%), hotel and
restaurants (4%) (v) rural butchers to consumer (100%) (vi) offals retailers receives (50%)
from offals contractors and sell all of it to consumers (vi) hotel and restaurants, food
services and suppliers and super markets to consumers (100%) and (viii) offals processors
receives (50%) offals from contractors and sell all to offals exporters. The meat transported
cost for domestic markets Rs.7.076 billion during 2008-09 which includes the transportation
cost of beef (Rs.4.752 billion) and mutton (Rs.2.324 billion).
The estimated cost of production of beef and mutton was Rs.169.49/kg and Rs.263/kg
respectively at feed lot fattening producer respectively. The marketing costs of beef and
mutton at producer level is Rs.169.49 and Rs.262.75/kg. The marketing costs of beef and
mutton at contractor/beopari level is Rs.7.50 and Rs.14.71/kg. The marketing costs of beef
and mutton at commission agent level is Rs.0.64 and Rs.4.83/kg. The marketing costs of
beef and mutton at butcher/retailer level is Rs.11.06 and Rs.21.73/kg respectively.
The sale price of beef and mutton at producer (feed lot fattening) level is Rs.184.17 and
Rs.280/kg. The sale price of beef and mutton at contractor/beopari level is Rs.200.18 and
Rs.302/kg. The sale price of beef and mutton at butcher/retailer level is Rs.220.81 and
Rs.327/kg respectively.
The net profit margin of beef and mutton at producer at feed lot fattening level is Rs.14.68
and Rs.17.25/kg. The net profit margin of beef and mutton at contractor/beopari level is
Rs.8.51 and Rs.7.29/kg. The net profit margin of beef and mutton at commission agent level
is Rs.0.61 and Rs.2.60/kg. The net profit margin of beef and mutton at butcher/retailer level
is Rs.9.57 and Rs.3.27/kg respectively.
The exported meat was 0.01436 million ton during 2008-09 (assuming the same as exported
in 2007-08) which includes beef (0.00697 m.t.) and mutton (0.0739 m.t) respectively. The
value of synthetic RCA for beef fresh/child/frozen, meat nes./fresh/chld/froz, meat/offals
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preserved, meat/offals preserved n.e.s etc. is greater than 1 which implies Pakistan has
comparative advantage in meat and meat preparation.
The main inefficiencies of meat marketing are (i) controlled retail price of meat causing
slaughtering of unhealthy and old animals (ii) absence of meat grading and pricing by quality
(iii) illegal slaughtering leads to poor quality meat (iv) lack of specialized skills in flaying and
meat handling (v) un-hygienic meat sale (retail outlets) (vi) no chilling facilities at butchers
shops and (vii) few operations for export and poor regulation for export.
The opportunities for meat export increase the source of foreign exchange and it may also
increase the income of farmers if facilitation from government/research institutions and
farmers interest to raise meat animals as a business on commercial basis. Moreover, the
export of meat offals has a potential like intestines of small ruminants for European
countries and “Patjori” export to China. There is a need to create awareness at local level
for export of offals. The threat for export meat is related with the exploitations local
consumers in the form of price and quality. Likewise illegal smuggling reduces foreign
resources and also exploits the local consumers. There is need of compulsion for exporters
to produce a reasonable export quantity at their own farms to avoid market distortion and
protect domestic consumers.
The proposed strategy/requirements for 1st segment of meat value chain namely “Inputs”
are (i) need improved breeding for meat animal programme with modern and scientific
management (ii) farmers awareness about low cost quality feed for ensuring adequate
nutrition and (iii) policies for cheaper inputs (feed and veterinary services) for higher use of
“inputs” .
The proposed strategy/requirements for 2nd segment of meat value chain namely
“Production of Meat Animals” are (i) farmers awareness about raising meat animals on
commercial basis (ii) shift to feed lot fattening or farmer production groups in rearing yards
(iii) effective disease monitoring and control for enhancing animal productivity (iv) need a
special focus on social system and (v) policies for reducing ag-inflation.
The proposed strategy/requirements for 3rd segment of meat value chain namely
“Marketing of Meat Animals: are (i) channeling of Contractual money for provision of basic
facilities (ii) encouraging Pvt Sector for developing markets with basic facilities (iii)
redesigning vehicles suitable for animal transport (iv) awareness to traders (v) enforcement
of pricing by weight and awareness campaign and (vi) proposed legal authority with
regulatory coverage.
The proposed strategy/requirements for 4th segment of meat value chain namely
“Processing (Slaughtering) and further Meat Processing” are (i) privatization of state owned
slaughter houses (ii) foreign/local investment (iii) SPS management through Veterinary plan
(iv) health authority (v) Meat standards and an industry Code of practice (vi) HACCP for
meat processing (vii) meat inspection laws and (viii) for enhancing legal slaughtering, there
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is a need for de-skinning machines may increase efficiency for slaughtering large ruminants
in the country with the consideration of employment concerned of manually slaughtering
workers
The proposed strategy/requirements for 5th segment of meat value chain namely “Meat
Marketing” are (i) a robust value chain, improved linkages with producers (ii) regulated
outlets – open price policy like chicken & fish (iii) cut-based pricing under free market forces
(iv) strict compliance of the legal slaughtering (v) awareness, provision of institutional
training & Registration (vi) awareness & implementation of SPS sanitary measures (vii)
consumer awareness of the benefits of a hygienic product (viii) investment-driven incentives
and effective regulation and standards and (ix) exposure visits for exporters.
Greater product diversification by the processors is needed. Processing of meat can be as
simple as preparation of retail cuts of meat, or it may involve grinding, flaking, sectioning,
seasoning, salting, curing, forming, smoking, heating, fermenting, drying or combination of
these treatments. The improvement of packaging utilizing food grade materials and the
greater use of vacuum packing are also required. Greater research or collaborative
research with other countries into food safety and veterinary and plant health, for example
(i) improved detection and screening techniques for residues of antimicrobials and their
metabolism in animal products (ii) the presence of drug metabolites in animal products
destined for human consumption (iii) the role that antimicrobials or their residues play in
food sensitization and subsequent hypersensitive reactions in humans (iv) the associations
and frequency of antibiotic resistance and (v) detailed studies to assess the microbiological
contamination at different stages of processing.
ii). Fertilizer Use Assessment during Rabi 2008-09 in the Pothwar Region of Punjab, Pakistan
 The main theme of this study was to assess the fertilizer use situation in Pothwar region of
Punjab, after, first – record high wheat procurement prices announced by the government
for the upcoming season that might enhanced fertilizer and other input use in the current
Rabi season, and second – high prices of both nitrogenous and phosphatic fertilizers from
the last Kharif season that might decreased fertilizer use.
 This study was conducted in Pothwar region of Punjab which, account for about one quarter
of the total cropped area of the Punjab. This tract is one of the poorest and food deficit
areas of the province. The small farmers, especially those in dry parts of Pothwar, are on the
average deficit in all the subsistence products. Majority of the farmers (90%) operate below
subsistence land resources of less than 5 hectares.
 So when this is the situation then the early described factors (high procurement prices of
wheat and high prices of fertilizers) are less important as compared with other so many
important factors. Important other factors like economic status of the farmers, timely
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rainfall and moisture, soil structure and texture, and next best alternatives might affect the
use of fertilizer in this region.
However, results reveal that nearly a bag of Urea and DAP each along with substantial
amount of FYM was applied to wheat crop on per acre basis while rest of the crops are
grown with negligible quantity of organic as well as inorganic fertilizers.
It was also found through farmers’ perception that fertilizer use was reduced up to 50
percent this season as compared with previous season with the major argument of high
prices by more than two third sample farmers.
Other interesting results depicted that urea use is directly related with wheat area and
inversely with total cropped area. Also Urea use increases as DAP use and FYM use
increases.
So it is verified that high wheat procurement prices induce fertilizer use to wheat and high fertilizer
prices reduce its use. But at the same time timely rainfall and economic conditions of the farmers
supported this scenario. Therefore in rainfed conditions, where farmers get benefit at four months
early investment wit high uncertainty, fertilizer should be provided at low prices.
iii). Feasibility of Inorganic, Orgaic Open Pollinated and Hybrid Vegetables Seed Production
in Pakistan
 Economic impact of hybrid vegetable production for the year 2010 to 2014 is estimated and
presented in table 2. During the year 2010, vegetable seed production will be carried out on
5130 acres at NARC and will produce hybrid seed production of 12.199 tons.
 Vegetable seed production will be carried out on 10260 acres at NARC and will produce
hybrid seed production of 24398 tons during the year 2011, during the year 2012; vegetable
seed production will be carried out on 20520 acres at NARC and will produce hybrid seed
production of 48.796 tons.
 Vegetable seed production will be carried out on 41040 acres at NARC and will produce
hybrid seed production of 97.592 tons during the year 2013.During the year 2014,
vegetable seed production will be carried out on 50675 acres at NARC and will produce
hybrid seed production of 109.49 tons. Hybrid Vegetable Seed Production by NARC with
Contract Growers will generate economic impact of Rs.8.07 billion.
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This intervention will generate Rs.272.56 million, Rs.599.63 million, Rs.1319.18 million,
Rs.2902.20 million and Rs.4019.31 million during year 2010-14 respectively. Year wise
detailed economic impact of hybrid vegetable production is presented in table 11-15.
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This enterprise will also generate social impact like job creation, improvement in education
and health as well as reduce man migration to city. An estimated job opportunity will be
created about 0.21 million people by implementing the activities of this project. Positive
environmental impact in the form of healthy and fresh air for the human population will
improve health and reduce expenditure on treatment. Man migration to city will be
reduced due to creation of new jobs and Agro based industry in the country side.
Under different activities of this project oxygen will be mitigated through excess utilization
of carbon dioxide. Production of the oxygen will be double which will improve the
availability of healthy and fresh air for human being. The silt of the reservoirs especially of
Mangla and Tarbela dams will be minimized thus increasing the consumable life because it
will reduce the run of soil of hills and mountains due to torrential rains and winds.
iv). Global Good Agricultural Practices for Export of Fruits and Vegetables: An Investment
Proposal
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GAP project will generate number of socio-economic and environmental benefits. The main
beneficiaries would be citrus growers and traders.
Pakistan’s current export earnings from citrus fruit are estimated at US$ 40 million. Noncompliance to emerging SPS issues may threaten the sustenance of even the existing levels
of exports what to speak of enhancement.
Therefore, the project will help assure compliance and will thus directly impact export
volume and values (ii) empowerment of the farming communities to make right site specific
decisions regarding crop management to meet challenges of world trade scenario (iii) the
BAP certified products will fetch premium price due to no risks to human health (iv) the
Project activities will provide foundation to organic production which enjoys a growing
niche market (v) a reduction of production costs will be achieved due to less use pesticides
and other synthetic chemicals(vi) sustained and improved produce quality and yields
resulting in improved farm incomes. Reduced negative impacts on soil fertility (vii) reduced
probability of resistance to pesticides.
Social impact will be (i) more & better crop management especially pest control options
available to farmers (ii) socio-economic up lift of farming communities through better
quality produce (iii) better understanding between farming communities and export market
(iv) increased knowledge and self confidence of farmers (v) more community initiatives (vi)
better image of the agriculture sector with other groups of the society.
Environmental impact will be (i) a generally more stable environment (ii) reduced danger of
biodiversity loss (iii) reduced degradation of natural resources (iv) protected natural
habitats (v) sustainability of the environment and reduction in health hazards to pesticides
users and consumers through rationalizing use of pesticides through developing awareness
and implementation of best agricultural practices.
v). Feasibility of Sugarcane Juice Manufacturing in Pakistan’s Punjab
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The project cost estimates for the proposed “Sugarcane Juice Business” have been
formulated on the basis of discussions with industry stakeholders and experts.
The projections cover the cost of land, machinery and equipment including office
equipment, fixtures etc. The operations have been calculated for 300 days on annul basis.
The financial analysis reveals that sugarcane juice at the scale of 100 tones per day crushing
will yield 691.20 million rupees annually with total variable cost of 435.84 million per
annum.
The analysis further narrowed down on per pack level that yields Rs.3.00.
As about 90 % of the ingredients is sugarcane juice therefore the margin might be less as
compared with other fruit juices because fruit juice contain only 4% Fruit Pulp and 80 %
treated water while 10 -16 % Citric Acid, Fruit Flavor and Preservative.
vi). Pilot Tomato Value Chain Development Scheme in Punjab Province of Pakistan
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The primary project outcome would be increased producer’s share in consumer rupees and
a shift towards export led tomato production.
The other associated outcomes would be increase in export earnings, farm household
incomes of farmers participating in tomato value chains, and employment in agroprocessing and agro-business enterprises.
The outcome indicators are linked directly to millennium development goals of sustainable,
diversified and export oriented economy that responds to market demands, particularly: (a)
positive contribution of sectors to GDP growth and (b) growth of exports. The outcome
indicators are:
 Increase in production volumes through enhanced productivity and reduction in
post harvest losses;
 Safe and hygienic quality tomato handling and marketing to the end users
 Increase in value of tomato produce;
 Increase in average income of small farmers linked to value chain project activities.
 Increase in export volume at higher export price by meeting the SPS standards
Output indicators are linked to the intermediate results described in the results framework
and comprise mainly the following:
 Increase in tomato productivity of small farmers linked to tomato value chain project;
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 Number of tomato farms who adopted GAP
 Number of villages and farmers linked to the tomato value chain
 Number of tomato farmers associations developed and sustained by decreasing the
project support.
 Change in effectiveness and efficiency of services provided by tomato processing
industry and its related public and private institutes to stakeholders;
 Volume of quality tomato produced and reached to the consumers through vertical
coordination in the value chain.
Pilot tomato value chain development scheme will ensure timely availability of quality input
to tomato growers at their doorstep which will provide opportunities for the adoption of
recommended input use. Capacity building and training on knowledge and skill transfer will
be empower growers for the adoption of modern tomato production, management and
harvesting and handling technologies.
These interventions will enhance tomato productivity and its quality and resultantly will
generate more income with higher yield and better tomato quality. The capacity building
and training on knowledge, skill, post-harvesting techniques, handlings, food safety and
standard, packing, processing to other chain stakeholders will improve their capacity for
reducing huge post-harvest losses and getting higher prices from export markets. So, other
chain stakeholders will also be benefited in the farm of more knowledge, skill, techniques
and more income from better prices from the export markets.
vii). Export Competitiveness of Pakistan’s Horticulture
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This Study examines Pakistan’s export competitiveness of horticultural produce by using
trade-based indices.
Under horticultural crops, fruits plus vegetables, fresh fruits nes, and vegetables fresh nes
were selected as groups and tangerines, mandarins clem, and Onion were selected as
individual crops for empirical study.
The study aimed at assessing the comparative and competitive advantage of Pakistan in the
selected commodities.
The results showed that Pakistan does not have a comparative and competitive advantage
for fruits plus vegetables category during 1990 to 1998, however Pakistan attained
comparative and competitive advantage in 1999 and maintained it up to 2006 with few
exceptions but net trade advantage for fruit plus vegetable category was achieved in 2004.
In the fresh fruits nes category the results demonstrated that Pakistan has relatively
higher comparative and competitive advantage as compared to fruits plus vegetable as
whole, all relevant indicators were encouraging and explained Revealed comparative
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advantage and net trade advantage with few exceptions for the whole period depicted in
the analysis.
In vegetables fresh category, fruits plus vegetable category and onion Pakistan showed a
transition from comparative and competitive disadvantage to comparative and competitive
advantage during the period under analysis.
The analysis for individual crops i.e Tangerines, mandarins, clem depicted that it maintained
relatively higher export competitiveness as compared to other categories for the whole
period under analysis.
Pakistan’s comparative and competitive advantages showed an increase in all commodities
for the period under analysis.
viii). An Overview of Pakistan Poultry Sector
Poultry production is an important part of agro industry and plays its role in food security
of the country, however this industry is characterized by small and unorganized operators,
lack of disease control, uneven distribution of profits and lack of technology, some
dangerous disease. This study was conducted to investigate the present status of poultry
sector in (Punjab), challenges, development projects and incentives and strategies for
control and management of this sector.
 Pakistan has a vibrant poultry sector, with more than half a billion birds produced
annually. Commercial poultry production has bridged the gap between supply and
demand of animal protein. It has kept a check on prices of mutton and meat.
 Poultry is the cheapest available meat protein for our masses and is the second largest
industry having 200 billion investments. According to economic survey 2008, it is
producing and supplying in the market 10712 million table eggs 601,000 tons of poultry
meat and at present contributes 19 percent of total meat consumption.
 There are two distinct production systems in Pakistan. The traditional rural system and the
commercial poultry system. Today it constitutes a large segment of national economy and
consists of 30.57 million domestic chicken and 98.45 tons of domestic poultry meat.
Commercial poultry production; which started in 1963 to supply the Karachi market and
now has an investment of over 23 billion rupees. It is comprised of 26.56 million layers,
407.7 million broilers and 7.61 million breeding stock.
 Commercial poultry feed is usually purchased, although some farmers use home-mixed
feed.
 The population of poultry in the Punjab Province decreased from 27848 in 1986 to 24952
in 1996 while in 2006 the population of poultry again increased to 25906.
 Poultry meat production has been increased from 512 thousand tones in 2005-06 to 601
thousand tones in 2007-08 and it has registered a significant increase of 8.48 percent in
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2007-08 over 2006-07. Annual total day old chicks production jumped from 387.2 million
in 2006-07 to 425.95 2007-08 million with an increase of 10 percent and poultry bird
production increased from 477 million in 2006-07 to 518 million in 2007-08 with an
increase of 8.48 percent.
According to HIES 2004-05 the per capita monthly consumption of chicken meat was 0.23
while mutton and beef consumption was 0.07 and 0.33 respectively in Pakistan.
According to FAO estimates in 2003 the total Pakistan poultry meat consumption quantity
was 2 Kg per capita per year as compare 11 kg per capita per year world poultry meat
consumption. Pakistan as a predominantly Muslim country has comparatively high, and
rising, levels of meat consumption.
At present there are about 22688 poultry farms in the Punjab province with an investment
of Rs. 28500 million .There are 119 feed mills which produced 2.17 million ton poultry
feed. There is a capacity to produce 491.04 Million broiler birds ,20.8 million layer birds
and 5.53 million breeding stock while 329 Million broiler birds ,16.61 million layer birds
and 4.85 breeding stock are actually being produced. The share of broiler in poultry meat
is 329108 million metric ton poultry while the share of culled birds and desi birds is 21463
and 41226 million tons respectively.
The number of Government poultry farms remain same from 2002-2007 while the
number of birds maintained increased from 706 thousand in 2002-2003 to 797 thousand
in 2006-2007. The number of day old chicks also increased from 555 thousand in 200203 to 592 thousand in 2006-07.
From 1990 onward, growth in poultry sector was on tremendous scale despite few
setbacks but it is pertinent to mention that during this period balance of growth greatly
titled in favor of Punjab region. Hi Tech group, National group, Olympia group are very
famous and became poultry industry giants, closely followed by SB group, Asia feed group
and Islamabad group.
In Pakistan poultry is sold through vet markets in cities and villages. Birds are selected live
by the consumer and slaughtered and dressed by the retailer. Only a small percentage of
commercial broilers are commercially processed, mainly for hotels. Currently, Pakistan
employs a three-tiered system composed of poultry farmers, commission agents, and
retailers.
Commission agents usually get the produce from the farmers at low prices and earn large
profits by selling the same products at a higher price to retailers, who turn around and
mark up products to miffed consumers in wet markets.There, are fluctuations in sale rates
of poultry products in Pakistan.
Poultry meat production over many decades have publicized optimistic growth in the
overall performances of the livestock sector and it has now reached a stage where its
impact is obvious on the national economy of the country.
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Poultry keeping business is one of the most hopeful sources of additional income.
Besides, this poultry farming has a number of advantages. It produces much needed
protein, food, it serves as a source of income and employment to many and it has good
returns. Poultry keeping is becoming more and more capital intensive, and it is very
profitable.
 The income from poultry business begins to emerge within 8 to 9 weeks for broiler or 20
to 22 weeks for layers.
 Different development projects and incentives are provided by Government of Pakistan
to this sector ; National programs for the control and preservation of avian influenza,
Credit schemes by ZTBL, livestock development policy and poultry development policy and
Reduce input costs policy in poultry production are notable.
 Poultry farming, poultry processing and poultry feed were recognized by the government
as agro based food processing industry, and given incentives like total or partial
exemption from import duties and sales tax and income tax holiday for number of years.
 There is a strong increase in high-value agriculture and vertical coordination in Asia. This
vertical coordination into wholesaling in poultry sector will allows them to standardize
quality, improve bargaining power, and achieve economies of scale in distribution. In
addition, they usually adopt a list of preferred suppliers who are known to be able to
produce consistently the quantity and quality demanded by the supermarket chain.
 The demand and supply mechanism, fluctuation in the rates of day-old chicks and the
skyrocketing prices of poultry feed are the main reasons for fluctuation in prices of poultry
products. Feed accounts for more than 70 per cent production cost for poultry comes
from feed prices. Poultry feed prices have gone up by 22 per cent in 2007-2008.
 The extraction of abnormal profit by middlemen reduces the profit of poultry farmers and
discourages them to expand the production unit. Achieving international standards for
being able to compete in the export market is another proposed option but it would make
much more sense to concentrate on meeting domestic demand.
ix). Market Chain Analysis of Broiler Production Options for Small Farmers in Rawalpindi
District
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Poultry production in Pakistan is an important part of agro industry; however this industry is
characterized by small and unorganized operators, lack of disease control, uneven
distribution of profits and lack of technology.
Forty producers, ten wholesalers, ten retailers and thirty consumers for poultry sector were
interviewed. About 10 percent of the producers were illiterate while the remaining 90
percent of broiler producers have been to school for various years. 80 percent broiler
respondents were head of the family, 10percent were the family members, 5 percent were
manager and the remaining 5 percent were workers.
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In the study area 82.5 percent were involved in the full time farming while 17.5 percent was
carrying part time farming activities. Poultry farming was the main source of their
livelihood. It has been observed that majority of producers have greater than 11 years of
experience (45percent) while 22.5 percent producers have 9-11 years of poultry keeping
experience. Most of the farmers (77.5 percent) were having both the Hubbard breed.
Of the market men who visited the producers for the purchase of broiler comprised of
contracting agencies (27.5 percent), wholesalers (20 percent), commission agents (47.5
percent) and retailers (20 percent). The average business experience of commission agent,
wholesaler and retailers was 13 ,14 and 14 respectively.
Broiler production is a profitable business in the study area. With a CTO of about 2.23 and PI
of about 0.55, improvements in broiler production is likely to increase the returns of broiler
farmers.
To maximize profit from broiler production, therefore all inputs should be used at their
optimal level.
The difference between profit shares of farmers on the basis of selling to different agencies
was measured to identify different forms of integration. The highest profitability index (PI)
was 0.59 which was same for farmers who sold to contract farmers and consumers
respectively.
The highest capital turn over CTO was 2.46 for contract farmers while 2.42 for farmers who
sold to consumers. The farmers who sold to retailers and wholesalers have 1.93 CTO. The
Lowest CTO (1.80) was recorded for farmers who sold to commission agent. This indicated
that to maximize profit from broiler production, producers must have a close contact with the
demand side.
The low profit of small farmers having intermediaries in the market chain is because the
market is not competitive and one of the middleman acts opportunistically to exploit the
farmer
Broiler producers in the Rawalpindi district, mainly sold their produce to commission agents
(47.5%), followed by the contracting agencies (27.5%) and wholesalers / retailer (20%). Only
(5%) producers sold their produce directly to consumers at their own farm.
The absolute cash margin of wholesalers and retailer received Rs.8 per kg and Rs.7 per kg
respectively while the commission agent received Rs.3 per kg.
The producers share was highest. The percent share of wholesaler and retailer was high in
comparison to commission agent in the marketing chain.
Results show that wholesaler received highest percentage profit margin (89 percent)
followed by commission agents (85 percent). The other market agencies including retailer
and producer received 67 percent and 46 percent respectively.
Feed prices, inappropriate marketing outlets, input prices, diseases, lack of quality of inputs
and unavailability of vet services etc. were the major problems faced by the broiler
producers in the area. The fluctuation in live bird prices and day old chicks is the significant
factor in losses to small farmers. Feed accounts for more the highest production cost for
poultry.
x). Relationship between Production, Procurement Prices and Volume of Procurement of Wheat
in Pakistan
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There has been continuing debate about the role of procurement prices in the volume of
procurement of wheat in Pakistan. It has been argued that higher procurement prices
would secure higher level of procurement .In the present study on relationship between
production, Procurement prices and volume of procurement of wheat in Pakistan, the
above mentioned argument is statistically examined with historical view of the agriculture
sector of Pakistan.
The data used in the study has been collected from the secondary sources. The main source
of data is various issues of Agricultural Statistics of Pakistan. Published by Ministry of Food,
Agriculture and Livestock, Islamabad. The period selected for the study is from 1980-81 to
2006-07 (26 years), as the recent data available.
Wheat has the major share in foodgrain. The overall performance in the period of 26 years
under study 2.70 percent was the growth rate of coarse grain production and 2.76% for
wheat in Pakistan. In 2000’s wheat production increase was the highest 7.35% in Sindh and
NWFP was second in ranking with 7.21% increase over the ten years. Considering the
overall performance within the study period of 26 years rate of increase in wheat
production was the highest in Balochistan (5.12%) inspite of the fact that the area under
wheat and its volume of production was small as compared to other provinces.
At national level wheat production contributes from 70 to 76 percent to the total foodgrain
production Punjab is the major wheat growing province among the provinces which is
contributing from 50 to 58 percent of wheat share to the total foodgrain production.
The farmers are forced to part with their surplus produce soon after the harvesting when
prices are generally at the lowest level. In Pakistan the Government is playing effective role
to facilitate the farmers by fixing procurement price and procuring wheat from the farmers.
The Government has been procuring wheat through PASSCO and the Provincial Food
Departments for the past many years. Punjab is the major wheat growing province of the
country Therefore, the major share of the wheat is procured from Punjab. Wheat procured
from Punjab ranged between 70 to 80 percent. The overall increase in the procurement
price from 1980-81 to 2006-07 was 632.76% in the 26 years of the period under study which
facilitated the expansion in the production of wheat crop.
The performance of achieving targets of production was more or less satisfactory. The
country either achieved the targets or remained closer to it even in some years production
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was achieved above the target. The quantity procured as percent of actual wheat
production ranged between 20 and 45 during the study period of 26 year from 1980-81 to
2006-07.
The procurement of wheat statistically has the inverse relation with procurement price and
closely linked with the production. The change in the production of previous year deeply
influence the procurement. The increase in the volume of procurement, procurement price
and production was the highest in the second decade of 1990’s. the spectacular increase in
wheat production owed to the massive switch over to HYV’s of wheat. The second factor
which added more to increase is the result of the use of the new technologies.
It is believed that procurement depends for more on volume of production and much less
on the procurement prices.
The storage capacity available with the public sector in 2007 was 5242 thousand tones. Out
of the total available capacity 82.77 percent is used for wheat storage. There is a felt need
to increase the storage capacity in public as well as private sector.
The procurement price has inverse relation with the volume of procurement as indicated by
its regression. Coefficient which is minus 0.11 with t-value 0.008 highly significant at one
percent level of significance.
Cost is involved in each system which is introduced for the growth in agriculture sector.
The existing agricultural marketing infrastructure in the country is inadequate to meet the
growing needs of an expanding wheat market. Problems of storage and transportation are
the fore most issues that require quick and well planned solution one striking difference in
Government procurement price and purchasing of wheat by beoparies is that the latter buy
in village or even at the farm.
There is a need to economize the costs involved in the procurement of wheat. The
operation costs involved in the operation of wheat procurement can be met by levying
small cess on the production sold by growers to these agencies.
However, the analysis is not intended to suggest that the procurement prices have no role
to play what so ever in increasing procurement.