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Japfa to ship poultry to Myanmar in landmark export

Publicly listed poultry firm PT Japfa Comfeed is preparing to ship 100,000 parent stocks of broiler hatching eggs to Myanmar in its attempt to tap the foreign market since the 2004 avian flu outbreak in the country

The Jakarta Post
Jakarta
Sat, August 29, 2015

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Japfa to ship poultry to Myanmar in landmark export

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ublicly listed poultry firm PT Japfa Comfeed is preparing to ship 100,000 parent stocks of broiler hatching eggs to Myanmar in its attempt to tap the foreign market since the 2004 avian flu outbreak in the country.

The export marked the first shipment of the product abroad since the avian flu outbreak in Indonesia that has left the country an avian flu-affected zone until now.

The value of the exports was estimated to be around Rp 2.5 billion (US$178,445), based on the price of hatching egg parent stock from the Association of Poultry Breeding (GPPU).

'€œWe have bagged the import permit from Myanmar,'€ Japfa Comfeed Indonesia senior manager of government relations Fitri Poernomo said on Friday.

The stocks will be divided into three shipments, she said, which would contain 30,000 to 35,000 hatching eggs, starting in early September. The contract with Myanmar would last until 2017, she said.

Japfa Comfeed used to export chicken meat to Japan, but stopped when the avian flu outbreak prompted Japan to end its imports.

However, earlier this year, Japan restarted processed chicken imports from Indonesia, and the company has also been selected as a candidate for the export of chicken products to Japan, Anton J. Supit, the chairman of the Indonesian Poultry Breeders Association (GAPPI), noted.

The open market left a potential import value of US$200 million of processed chicken to Japan, according to an analysis by PT Bank Mandiri analyst Araminta Setyawati.

The poultry division is Japfa'€™s largest revenue contributor accounting for approximately 83 percent of annual net sales, which dropped to Rp 12.15 trillion in the January to June period this year compared to Rp 12.19 trillion over the same period last year, on the back of rising costs of goods sold with the weak rupiah.

Since then, the company has started to gear up its exports of processed poultry products to Japan, Singapore and the Middle East.

'€œFor the first phase, we have only had a green light from Myanmar. I think the demand from the Middle East is also quite high,'€ Fitri said.

Breaking into the Myanmar market was no easy feat as the country initially banned imports from countries that were not completely free of avian flu and also rejected products that were treated with vaccine.

However, Myanmar was also affected by avian flu and imports from bird-flu free countries remain limited. The situation prompted the Myanmar government to send a delegation to Indonesia, Fitri said.

The first visit occurred on July 1, with the aim to study the management of avian flu in Indonesia, led by the deputy minister of livestock, fisheries and rural development, Aung Myat Oo.

'€œThey then could see that there were still cases of avian flu in Indonesia but it was still under control,'€ Fitri added. Based on the visit, the Myanmar government agreed to revise its regulation.

Japfa Comfeed has also already bagged avian-influeza free certificates for its six breeding farms and three commercial farms.

However, the Myanmar government also took precautions, Fitri said, by only permitting the import of hatching eggs, which were safer than day-old chicks (DOC).

The company ended the first six months of the year with Rp 272.13 billion in net losses, a stark contrast to Rp 325.99 billion in net profit it reaped during the same period last year, as DOC sales slumped by 6.3 percent to Rp 675.01 billion from Rp 720.5 billion, according to its unaudited financial report. (fsu)

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