Chicken Industry

Staying out of the henhouse

First published in the Business Day. By Anthony Clark.

Poultry counter Astral Foods is a big rooster, producing about 5-million birds a week in a market that consumes 19-million chickens a week.

It has exceptional management and a solid business model. But the domestic poultry sector has been battling a prolonged weak economic and consumer environment that has hampered business and margin growth, and is still dealing with the dual impacts of increasing poultry imports as well rising input costs of maize in the past year.

Sector profits and margins have been badly gnawed. Another problem for Astral Foods is the collapsing infrastructure in Lekwa in Mpumalanga, where the dysfunctional municipality has been unable to deliver the basic service of water to its Standerton Goldi broiler processing plant.

CEO Chris Schutte has been critical of local government and the impact on Astral’s business in Standerton. The company employs more than 3,000 people in the town.

Read the rest of the article onBusiness Day.