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Farm Fearing Closure After 60% Business Fall

By NATARIO McKENZIE

Tribune Business Reporter

nmckenzie@tribunemedia.net

AN Abaco poultry producer fears it may go out of business in two-three months, its operations manager telling Tribune Business its business had dropped 60 per cent since the Government eliminated the permit regime for chicken imports.

Lance Pinder, operations manager of Abaco Big Bird Chicken Farm, a family-owned and operated business since 1995, told Tribune Business the company was in "pretty bad shape" and could be out of business by autumn 2012 if the situation did not improve.

He said: "We're actually in pretty bad shape. If things don't improve we're probably going to be out of business in two to three months.

"The Government did us in when they allowed those permits. That was the clincher. Our business has dropped 60 per cent. We used to have 70,000-80,000 birds at a time. Right now we are down to about 25,000. Our staff lost over $12,000 out of their salary last year. We've all taken pay cuts. Our staff is working part-time. The processing crew, which is about 20 persons, has had the worst of it. "

Having to compete with cheaper imports from the US and Brazil, combined with the rising costs of chicken feed and electricity, have all led to a downturn in business.

Mr Pinder said. "The cost of feed is insane, it's up 50-60 per cent. Last year, the corn prices in the US doubled. Electricity is killing us. It's our second biggest bill next to our feed bill. Our electricity bill has gone up 30-35 per cent. Last December, we used 30-35 per cent less electricity, and our bill was still the same."

The Government reduced the tariff on chicken imports by 10 percentage points in 2011, while in 2010 it removed a stipulation requiring chicken importers to have a permit.

Mr Pinder said: "Before that they used to regulate it a little bit to try and help us out, but they just totally got rid of it. There is no control any more on what is coming in.

"We see all the US chicken coming in, and there is chicken coming from Brazil. Most of it used to come from the US, and now a lot of it is coming from Brazil. It's not necessarily the grocery stores that are buying it, but a lot of what you are eating in the restaurants is coming from Brazil, and that's even cheaper than the US chicken."

The issues at Abaco Big Bird Chicken Farm go right to the heart of the Bahamas' so-called agriculture dilemma, particularly whether it should subsidise and assist local producers at the expense of consumer welfare and lower prices.

It touches on numerous policy-related matters, such as food security and the Bahamas producing more food to feed itself; employment; and how its agriculture producers can compete with low-cost foreign rivals enjoying greater economies of scale.

Mr Pinder, meanwhile, said the closure of City Markets had also affected Abaco Big Bird Chicken Farm, as the food store chain was one of its largest customers.

Mr Pinder said: "City Markets used to be one of our biggest customers, and then they went under. Supervalue and Solomon's carry our products, but we haven't seen an increase in sales from the other stores.

"There are a lot of other challenges. We hope the Government could try to put some controls in place to stop some of the imports, so as to get some of our products sold. That's the quickest thing they could do. We need something done now, and then maybe we could get a better plan later on to make it work better for everyone."

Mr Pinder said Hurricane Irene last year also had an adverse affect on the business, damaging the company's lime and avocado crops as well as its livestock.

Comments

Observer 2 years, 4 months ago

you mean adverse 'effect", right?

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Farmer 2 years, 4 months ago

"particularly whether it should subsidise and assist local producers at the expense of consumer welfare and lower prices". I work at Abaco Big Bird and I find this amusing because I have seen stores put a 100% markup on some our products and the worst ever was a 287% markup on some of our items. The lower prices are not benefiting the consumer or being passed along.

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