Assessment of Cooperatives in the Poultry Industry - 2013.pdf - Seda

2013
Research Report: Addressing the Needs, Opportunities and Challenges of Cooperatives
and Collectively Owned Enterprises in the Poultry and Related Industries
A value chain is predominantly used in the identification of opportunities for SMMEs and
cooperatives, and can also be utilised to grow an economy by differentiation and achieving
competitive advantage.
The poultry value-chain identifies industries which are significantly impacted by the production of
broilers and eggs. This impact is derived from an
increase in demand or the provision of essential inputs.
Figure 2-5 illustrates the poultry value-chain in South
Africa and was compiled using 2011 data from the
Department of Agriculture.
The poultry industry consists of two main sectors: egg
production and broiler production. Alongside this is the
market for day-old chicks which are bred and sold to
producers in both sub-industries.
The poultry industry
has many support
functions such as
transport and byproducts
of the
industry include
chicken manure,
spent hens and
broiler off cuts
In addition to the direct production of eggs and broilers,
the poultry industry has a large impact through
secondary activities, suppliers and outputs. The poultry industry is the largest consumer of maize in
South Africa, consuming around 2.68 million tons of maize per annum; 30% of the country’s total
maize consumption. In addition to this, feed is the biggest determinant of the cost of broiler and egg
production.
By-products of the industry include chicken manure, spent hens and broiler off cuts. The poultry
industry value-chain identifying the various role-players in the industry is illustrated below. Most
pertinent to this is the effect of the poultry industry both on suppliers, peripheral businesses and
businesses further down the value chain.
Implications for the Cooperatives in the Poultry Industry:
There may be scope for cooperatives to enter the market through secondary and support
functions or through use of by-products of the industry
Prices in the poultry industry are affected by a number of costs but most significant is the input
cost of chicken feed; this has a direct result on the costs of production. If the costs of feed
increase, the stability of the poultry industry and scope for new businesses will be in jeopardy
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