Farmers and consumers bear losses, retailers reap profits: Poultry Committee
The Broiler Integration Coordination Committee has criticised chicken retail shopkeepers for exploiting consumers and farmers in the poultry sector. According to the committee, the three-tier system of farmers, wholesale traders, and retailers unfairly burdens farmers and consumers, while retailers enjoy profits without risk.
Hyderabad: Profits in the poultry sector largely flow to those in the middle of the supply chain, while farmers and consumers bear the brunt, the Broiler Integration Coordination Committee said on Thursday.
In a press release, the committee explained that the industry functions on a three-tier system comprising Broiler Farmers or Chicken Producers, Wholesale Traders, and Retail Shopkeepers. Within this structure, farmers who raise the birds and consumers who purchase them are the most affected, whereas intermediaries reap the profits.
Seeking a close look at the exploitative practices of chicken retail shopkeepers, which are essentially a burden on chicken consumers, it said if there is any occupation that involves absolutely no risk, low capital investment, and no scope for loss, it is running a chicken retail shop.
The committee said the chicken retail shopkeepers are threatening to go on strike, claiming they want the companies to increase their profit margins though this is not true as there is a reasonable profit per kilogram sold every day.
However, there is absolutely no direct relationship between the integration companies and the chicken retail shopkeepers and the only direct link exists between the wholesale traders and the chicken retail shopkeepers.
The Farmer/Integration companies bear the burden of capital investment, risk, and potential losses, the committee said in the press release adding that the Wholesale Trader faces certain risks and operational challenges.
However, the individuals who face absolutely no risk or potential for loss are the chicken retail shopkeepers. Regardless of whether market rates drop or whatever other fluctuations occur, they suffer no financial loss. There is no loss in their margins.
The poultry sector is distinct from all other types of businesses. In the poultry sector, the ones who ultimately suffer losses are the farmers, integrators, who produce chicken at their farms with huge investments, the committee press release added.
