According to Stepanyan, most Armenian poultry farms are operating at a loss and a recent government program to develop the sector cannot be effective, given this scenario.
“Poultry farmers in the country have just begun to increase their production volumes and the industry is gradually restoring from the crisis, but cheap imports can destroy all that has been achieved,” he said.
“The quality of imported products is not always the best: according to various inspections, about 65% [of all imports] did not meet our country’s standards. However, consumers prefer cheaper goods.”
Stepanyan also stressed that poultry farmers were not asking to ban poultry imports completely, but wanted the authorities to limit imports of cheap, low-quality chicken parts, which created a non-competitive environment for domestic poultry farmers and harmed the health of citizens.
In June, poultry farm Art Farmer ceased operations. Company director Samvel Abrahamyan pointed out that the poultry industry was suffering from a lack of profitability: “I no longer want to deal with this, because it is impossible to start any [poultry production] business in our country. Production of poultry meat in Armenia has become absurd.”
According to official information, the annual demand for poultry meat in Armenia is currently estimated at 30,000 tonnes (t). Local manufacturers provide up to 30% of the domestic demand, with the overall volume of production at 10,000t. The largest importers of chicken are the USA, Brazil, Canada and Ukraine. Last year, Armenia’s government, together with the Union of Poultry Farmers, developed a program to increase poultry production capacity in order to gradually replace imports.
“According to our estimates, in the next five years [up to 2020], with the appropriate use of existing capacities and with necessary investment, we will be able to produce an additional 15,000t of [poultry] meat, which will allow us to cover more than half of the domestic demand [which is also projected to grow within the years ahead],” added Stepanyan.
The main challenge for the country’s farmers is expensive compound feed production. However, last year the country entered into the Eurasian Union, gaining joint customs space with Russia and Kazakhstan – the largest supplier of feed grain to the country. It was assumed this would stimulate strong development in the country’s meat industry. However, even with this bonus, it seems the local poultry industry cannot defend itself against cheap imports from abroad.