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Presented by Kevin Lovell; CEO of the Southern African Poultry Association
AGRICULTURAL JOB CREATION
IN THE POULTRY INDUSTRY
PRESENTED BY: Kevin Lovell
CEO of SAPA
ON: 19 April 2011
Small Footprint. Big Impact.
Presented by Kevin Lovell; CEO of the Southern African Poultry Association
…via complex supply chains
THE POULTRY INDUSTRY SPANS FROM FARM TO FORK....
Presented by Kevin Lovell; CEO of the Southern African Poultry Association
Primary producers
Processors
Distributors
Two distinct industries
Egg production
Meat production
THE POULTRY INDUSTRY SPANS FROM FARM TO FORK....
Presented by Kevin Lovell; CEO of the Southern African Poultry Association
THE POULTRY INDUSTRY: EGG INDUSTRY
The South African egg industry expanded by 34,6% between
2000 and 2010. The compounded growth over the period was
3,16% per annum.
Most of the expansion in the egg industry occurred after 2004
when egg production increased by 31,3% over three years.
The economic downswing and increasing input costs and severe
pressure on profit margins forced the egg industry to reduce
hen numbers.
Not a mature industry- eat about 40% of some developing
countries’ levels
Demand needs driving- no real egg eating habit
Presented by Kevin Lovell; CEO of the Southern African Poultry Association
SOUTH AFRICAN EGG INDUSTRY : EGG PRODUCTION
(Cases of 30 Dozen and Tons of eggs)
13,000,000
14,000,000
15,000,000
16,000,000
17,000,000
18,000,000
19,000,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
YEAR
C
A
S
E
S
280,000
300,000
320,000
340,000
360,000
380,000
400,000
T
O
N
S
30 Dozen cases / tons of eggs
THE POULTRY INDUSTRY: EGG INDUSTRY
Presented by Kevin Lovell; CEO of the Southern African Poultry Association
THE POULTRY INDUSTRY: BROILER INDUSTRY
Over the decade, the number of day old broiler chicks placed
has increased by 44% while the number of broilers
slaughtered has increased by 45,3% due to improved
productivity. The average compound growth in broiler
production over the ten years was 3,9% per annum.
The period of continued growth in broiler production from
2004 to 2007 was supported by increased demand, relatively
low input costs and a favorable Rand/Dollar exchange rate.
The downswing in the economy and the associated reduction in
disposable income resulted in a decrease in demand for
products and lower profit margins.
Not a mature industry- at least 50% volume increase possible
Latent demand
Presented by Kevin Lovell; CEO of the Southern African Poultry Association
THE POULTRY INDUSTRY: BROILER INDUSTRY
BROILER PRODUCTION PER ANNUM
600,000,000
650,000,000
700,000,000
750,000,000
800,000,000
850,000,000
900,000,000
950,000,000
1,000,000,000
1,050,000,000
2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
YEAR
B
I
R
D
S
Broiler chicks placed Broilers produced
Presented by Kevin Lovell; CEO of the Southern African Poultry Association
THE POULTRY INDUSTRY.......The Future
Per capita consumption of meat and eggs
relatively low in comparison with other countries
Poultry industry potentially set to grow by
approximately four percent per annum in the long
term
Depends on:
South Africa’s economic growth and the poultry
industry’s ability to remain competitive in the global
market and
reliable and affordable sources of grain and grain by-
products
Presented by Kevin Lovell; CEO of the Southern African Poultry Association
THE POULTRY INDUSTRY.......The Future
2020
2015
Presented by Kevin Lovell; CEO of the Southern African Poultry Association
THE POULTRY INDUSTRY.......The Future
Mixture of farm and town employment
Generally more town employment
Could add ca. 25 000 jobs in meat production
Could add ca. 8 000 jobs in egg production
Depends on:
South Africa’s economic growth and the poultry
industry’s ability to remain competitive in the global
market and
reliable and affordable sources of grain and grain by-
products
Presented by Kevin Lovell; CEO of the Southern African Poultry Association
THE POULTRY INDUSTRY.......Effect of imports
Equivalent of 5,5 million chickens per week
imported
Equal to 9300 lost jobs excluding any jobs in
grain production and other suppliers.
Tariff framework would allow for more local
production
Bound rate 80% and applied rate generally 27%
Presented by Kevin Lovell; CEO of the Southern African Poultry Association
THE POULTRY INDUSTRY.......Employment structure
Presented by Kevin Lovell; CEO of the Southern African Poultry Association
RECENT TRENDS ON EMPLOYMENT IN THE POULTRY INDUSTRY
Presented by Kevin Lovell; CEO of the Southern African Poultry Association
MAJOR CONSTRAINTS EXPERIENCED AND THE SUPPORT REQUIRED
BY THE INDUSTRY TO MAXIMISE THE CREATION OF NEW JOBS
Labour laws
Farm tenancy laws
Trade policy
State support for small farmer growth
Presented by Kevin Lovell; CEO of the Southern African Poultry Association
THIS CONCLUDES
“AGRICULTURAL JOB CREATION
IN THE POULTRY INDUSTRY”
By Mr Kevin Lovell
Small Footprint. Big Impact. A new era
