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Demand Projections for Poultry Products and Poultry Feeds in Bangladesh

Nabiul Islam
Markets and Structural Studies Division, International Food Policy Research Institute, 2033 K Street, N.W. Washington, D.C. 20006 U.S.A

Abstract/ Executive Summary:

The analysis carries out demand projections for poultry products and poultry feeds in Bangladesh over the next 20 years. Using separate rural and urban consumption data and income elasticities of demand, the national consumption of eggs is projected to be 5,866 million for 2020. The corresponding consumption of meat is projected to be 307 thousand tons. The estimated use of grains (wheat and maize) as poultry feeds ranges from 867 to 898 thousand tons for the year 2020, depending on the approach adopted. The requirement of wheat as poultry feed is only 8 percent of the total domestic production while the requirement of maize as poultry feed is as high as nearly 8 times its domestic production.

Keywords: Feed, Grain, Poultry sub-sector, Poultry, Poultry products

Location: In Bangladesh

Start Date:

End Date:

Program Area: Food Safety and Security

Commodity: Poultry, Nutrition, Feed

Objectives:

To estimate the total use of feed as grain by the poultry sub-sector, through assessing the current levels of demand and supply of poultry and poultry products.

Methodology:

Research on livestock resources in Bangladesh, in general, and the poultry sub-sector, in particular, is rather limited. The major contributors include Alam (1995, 1997), Mitchell (1997), Quasem (2001) and the studies conducted by the Department of Livestock from time to time. The research by Alam (1995), which has been later updated (Alam 1997), is a useful document on livestock resources in Bangladesh, presenting the existing status and the future potential of the sub-sector. The research, concentrating more on cattle and buffaloes, estimated livestock (including poultry) population and products and their growth rates as of 1994-95. The research also delineated the socio-economic aspects of livestock including identifying the constraints to livestock production. Mitchell (1997), which is a policy paper, based on a mission to Bangladesh, outlined the problems and prospects of the livestock sector. It also covered the consumption and marketing aspects of poultry products in Bangladesh, largely using data generated by FAO Yearbook (1997). The paper by Haque and Raha (1997) is a research note concentrating on maize marketing in Bangladesh at the micro-level. The study by Saha and Asaduzzaman (1998) discussed the present status of production organization and technology, concentrating on the poultry sub-sector with special emphasis on disaggregated input-output structure for the sub-sector. This was a background study, aiming at estimating relevant input-output coefficients for use in the construction of the national input-output table. The study by Quasem (2001), undertaken simultaneously with the present study under the Food Management and Research Support Project (FMRSP), discussed survey results showing the principal characteristics of poultry farms and the efficiency of their feeding practices at both household and commercial levels. This study has also consulted other documents published elsewhere, such as Sarma (1986) and Mink (1987). Sarma (1986), a Research Report published by IFPRI (Washington), is concerned with the analysis and projections (to 2000) of use of cereals for livestock feed in developing countries. Mink (1987) has addressed the use of corn in livestock feed and the future of the corn economy in Indonesia. The study focussed on current levels of corn use and likely future growth of corn-based livestock feeds in Indonesia. Despite the availability of the studies mentioned above, knowledge about aspects relating to the supply and demand of poultry feed in Bangladesh is rather limited. In particular, data on the present poultry population and poultry products, disaggregated by commercial and scavenging nature, are not available in any of the studies mentioned above. Data Sources: The study is largely based on information from secondary sources; Agricultural Censuses (1960, 1977; 1983-84, 1996) are the main sources of historical data on the poultry population. FAO Yearbook (1997) was also a source in this respect. However, such information are supplemented by primary data generated from field surveys. A basic problem with the analysis of poultry population and feed trends relates to the lack of reliable and adequate data on their use by type of feed and by category of poultry output.

Source of Information: Research Papers in Economics, MSSD DISCUSSION PAPER NO. 54, January 2003

Article Link (Online Journal): http://www.cgiar.org/ifpri/divs/mssd/dp.html

Funding Source:

Total Budget (Tk.) :

Achievement/Findings:

The two estimates involving the two approaches are within a reasonable range. In order to derive more concrete conclusions, a sensitivity analysis for various alternative scenarios is carried out. Four estimates under four scenarios have been compared. The first scenario for each of the two approaches relates to the basic scenario referred. At this stage, it is pertinent to say a few words on the results of the four alternative scenarios, including merits and demerits of the two methods adopted. In the first approach, i.e. Demand Approach, demands derived from the consumption of poultry products are dependent on factors such as income growth and income elasticities, urbanization, and population growth. Ideally, separate elasticities for scavenging and commercial poultry products, and separate income growths for rural and urban areas should have been estimated and used. Moreover, in this analysis, the factors such as tastes and, more importantly, relative product prices could not be incorporated. In Bangladesh, this issue is particularly important. Seasonal price fluctuations following the non-availability of grain as poultry feed throughout the year should be taken into account to estimate the total poultry feed requirement. Because grains are very often replaced by substitute feeds as a result of a rise in prices. Hence, the non-incorporation of price elasticity of demand is a limitation of this analysis. Unfortunately, data on these aspects are neither available nor reliable. Particularly, the data that can identify the demand characteristics for commercial, as opposed to scavenging poultry meat and eggs, are not available. In rural and even in urban areas, it is still a widespread notion that the scavenging poultry meat and eggs are superior in terms of tastes and nutritional contents. On the other hand, there appear to have constraints for the supply of commercial birds in rural areas, as the commercial farms are largely concentrated in urban areas. The fact that the scavenging birds are imperfect substitutes for commercial birds has not been incorporated, which is another limitation of this approach.

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