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1 Meat Industry Research Report on Meat Industry July 25 2011

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Page 1: SFA Meat Industry Research Report

1

Meat Industry Research

Report on Meat Industry

July 25 2011

Page 2: SFA Meat Industry Research Report

2

Table of Content

1. Global Meat Industry

2. Global Halal Food Industry

3. Pakistan Animal Supply Analysis

4. Pakistan Meat Demand Analysis

5. Regional Analysis

6. Meat Shop in Lahore A Case Study

7. Investment Highlights

Page 3: SFA Meat Industry Research Report

3

The global population reached 6.9 Billion in 2010. Thecurrent growth rate is 1.15% per annum and is expected todecline steadily to less than 1% by 2020

Average per Capita Production of Meat elevated from 40.6Kg in 2007 to 41.1 Kg in 2010 with CAGR of 0.41%

Beef Production hiked from 62,838 KT in 2005 to 64,927 KTin 2010 with CAGR of 0.8%

Poultry Production increased worldwide from 83,234 KT in2005 to 97,546 KT in 2010 with CAGR of 3.3%

The Sheep Meat Production rose from 12,455 KT in 2005 to12,819 KT in 2010 with CAGR of 1.1%

58,000

59,500

61,000

62,500

64,000

65,500

67,000

68,500

70,000

2005 2006 2007 2008 2009 2010

“00

0”

MT

Global Beef and Veal Production

50,000

60,000

70,000

80,000

90,000

100,000

110,000

2005 2006 2007 2008 2009 2010

“00

0”

MT

Global Poultry Meat Production

11,800

12,000

12,200

12,400

12,600

12,800

13,000

13,200

13,400

2005 2006 2007 2008 2009 2010

“00

0”

MT

Global Sheep Meat Production

Global Meat Industry

Rising Commodity Prices

Curtailed Production

Global Recession declined mutton production in wake of lower demand

Global Recession declined production growth rate in wake of lower demand

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

Page 4: SFA Meat Industry Research Report

4

The meat consumption worldwide had a steady growthfrom 2005 to 2010.

Average per Capita Consumption of Meat from 2007 to2010 elevated from 38.5 Kg to 38.99 Kg with CAGR of0.55%

The consumption of Beef from 2005 to 2010 rose from61,621 KT to 64,273 KT with CAGR of 0.87%

Global Poultry Production from 2005 to 2010 hiked from82,820 KT to 97,511 KT with CAGR of 3.41%

Global Sheep Meat Production from 2005 to 2010 rosefrom 12,318 KT to 12,802 KT with CAGR of 1.27%

59,000

60,000

61,000

62,000

63,000

64,000

65,000

66,000

2005 2006 2007 2008 2009 2010

“00

0”

MT

Global Beef and Veal Consumption

75,000

80,000

85,000

90,000

95,000

100,000

2005 2006 2007 2008 2009 2010

“00

0”

MT

Global Poultry Meat Consumption

12,000

12,200

12,400

12,600

12,800

13,000

2005 2006 2007 2008 2009 2010

“00

0”

MT

Global Sheep Meat Consumption

Global Meat Industry

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

Page 5: SFA Meat Industry Research Report

5

Global Beef and Veal Demand Forecast

Factors that derive the Meat demand are human populationGrowth Rate, Per Capita GDP and Meat Prices

Per Capita GDP is an important factor that effects the meatdemand, given the fact that most of the Global population ispoor. The relation between the marginal propensity toconsume meat and Per Capita GDP will not be linear ,in fact, itwill have an exponential relationship

Meat Prices are inversely proportional with Meat Demand

The Global demand for beef is expected to grow at a CAGR of1.3%

Global Beef and Veal Supply Forecast

The primary drivers of Meat Supply are Animal BreedingRate, Commodity Prices and Meat Prices

Meat Supply is directly related to Animal Breeding Rate andMeat Prices while inversely related to Commodity Prices asCommodity Price determines the cost of raising animals

Beef Supply is expected to grow at CAGR of 1.3%, althoughDemand & Supply growth rates are equal, the Global BeefSupply is expected to exceed Beef Demand by 674 KT in 2015due to higher base effect

Global Meat Industry: Demand & Supply Forecast (Beef)

62,000

64,000

66,000

68,000

70,000

2011 2012 2013 2014 2015

“00

0”

MT

Global Beef and Veal Supply Forecast 2011 - 2015

62,000

64,000

66,000

68,000

70,000

2011 2012 2013 2014 2015

“00

0”

MT

Global Beef and Veal Demand Forecast 2011 - 2015

Source: OECD FAO

Source: OECD FAO

Page 6: SFA Meat Industry Research Report

6

Global Poultry Meat Demand Forecast

Global Poultry Meat Demand is Forecasted togrow from the base of ~100,135 KT to 109,491 KTwith a CAGR of 2.44%

The growth of Poultry Demand can be primarilyattributed to the following factors:

Increase in Global Human Population.

Lower Poultry Prices as compared to Beef andMutton.

Increase in GDP per Capita

Global Poultry Meat Supply Forecast

Global supply of poultry meat is forecasted to growfrom the base of 100,115 KT to 109,473 KT with aCAGR of 2.4%

Slightly lower Supply Base as compared to Demandbase and lower Poultry Meat Supply Growth Rateas compared to Poultry Meat Demand GrowthRate will produce a deficit of 18 KT in 2015

Global Meat Industry: Demand & Supply Forecast (Poultry)

95,000

100,000

105,000

110,000

115,000

2011 2012 2013 2014 2015

“00

0”M

T

Global Poultry Meat Demand Forecast 2011 - 2015

95,000

100,000

105,000

110,000

115,000

2011 2012 2013 2014 2015

“00

0”M

T

Global Poultry Meat Supply Forecast 2011 - 2015

Source: OECD FAO

Source: OECD FAO

Page 7: SFA Meat Industry Research Report

7

Global Sheep Meat Demand Forecast

Global Sheep Meat demand is forecasted to be onthe higher side with a CAGR of 2.03%

Demand is Forecasted to grow from the base of~12,802 KT to 14,155 KT.

The growth in Sheep Meat Demand can beprimarily attributed to the following factors:

Increase in Global Human Population

Increase in GDP per Capita

Global Sheep Meat Supply Forecast

Global Sheep Meat Supply growth is expected tooutperform Demand growth by a margin of 7 bpsfor the period under consideration

In addition to higher growth rate as compared toDemand, Supply also outperforms demand interms of absolute numbers, thanks to higher baseeffect i.e. 12,819 KT, however the Global DemandSupply gap remains at a minimal level with thesurplus Supply of 67 KT

Global Meat Industry: Demand & Supply Forecast (Sheep)

12,500

13,000

13,500

14,000

14,500

2011 2012 2013 2014 2015

“00

0”M

T

Global Sheep Meat Demand Forecast 2011 - 2015

12,500

13,000

13,500

14,000

14,500

2011 2012 2013 2014 2015

“00

0”M

T

Global Sheep Meat Supply Forecast 2011 - 2015

Source: OECD FAO

Source: OECD FAO

Page 8: SFA Meat Industry Research Report

8

Uruguay leads the beef and veal consumption per capitawith 62.1 KG/person per annum while Argentina is rankednumber at number two with per capita consumption of55.8kg/person per year. Graph shows that developingcountries consume Beef and Veal more than developedcountries

Kuwait consumes the most poultry meat in terms of percapita i.e. 59.9kg/person per year followed closely by UAEwith almost similar consumption of 59.1kg/person per year

Iran has the highest Sheep Meat Per Capita Consumptionwith ~16 Kg Per Person consumption Per annum followedby Australia with ~11 Kg Per Person consumption

Global Meat Industry: Consumption Wise Top 5 Countries

0

10

20

30

40

50

60

70

Uruguay Argentina United States

Brazil Paraguay

KG

/ P

ers

on

Beef and Veal Per Capita Consumption 2010

010203040506070

Kuwait United Arab

Emirates

Brazil United States

Hong Kong

KG

/ P

ers

on

Poultry Meat Per Capita Consumption 2010

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

16

11

6

3 3

-

4

8

12

16

20

Iran Australia Saudi Arabia

China South Africa

KG

/ P

ers

on

Sheep Meat per Capita Consumption2010

Page 9: SFA Meat Industry Research Report

9

Table of Content

1. Global Meat Industry

2. Global Halal Food Industry

3. Pakistan Animal Supply Analysis

4. Pakistan Meat Demand Analysis

5. Regional Analysis

6. Meat Shop in Lahore A Case Study

7. Investment Highlights

Page 10: SFA Meat Industry Research Report

10

Current Global Muslim population is estimated to

be 1.9 Billion

Global Halal products market was estimated at

US$2.3 trillion excluding Islamic banking in 2010

Food and Beverages covers a significant share of

the overall Halal Products Market

The volume of trade in Halal food business is

enormous with an estimated annual value of USD

644 Billion globally

Major Halal Meat Importing Muslim Countries

include GCC Countries, Iran and Malaysia, while

major Meat Exporting countries include

Brazil, Australia and India

Global Halal Food Industry

Statistics 2008 2009

ContinentMuslim

Population (Million)

Muslim Population

(Million)

Africa 462.4 514.50

Asia 1,130.8 1,258.26

Europe 51.5 57.26

North America 7.1 7.93

South America 2.4 2.68

Oceania 0.5 0.56

Total 1,654.6 1,841.2

153

406

67

2 16

-

100

200

300

400

500

Africa Asia Europe Australia American

USD

Bill

ion

Global Halal Food Market Size 2010

Source: WHF Secretariat

Source: www.islamicpopulation.com

Page 11: SFA Meat Industry Research Report

11

Table of Content

1. Global Meat Industry

2. Global Halal Food Industry

3. Pakistan Animal Supply Analysis

4. Pakistan Demand Analysis

5. Regional Analysis

6. Meat Shop in Lahore A Case Study

7. Investment Highlights

Page 12: SFA Meat Industry Research Report

Agricultural sector plays a pivotal role in Pakistan’seconomy, as second largest sector with contribution ofover 22% to the GDP and employing ~45% of totallabor force

Livestock has a Lion’s share of 50% in the Agriculturalsector

Livestock is further subdivided into:

Milk Meat

Milk having larger share due to lack of attentiontowards meat processing industry

12

22%

24%

55%

0% 20% 40% 60%

FY 2010 - 11

Sector Contribution to GDP

Services Industry Agriculture

50%50%

Subsectors Contribution to Agriculture

Crops Livestock

0

4,000

8,000

12,000

16,000

FY06 FY07 FY08 FY09 FY10

Historic GDP in PKR Billion

Pakistan Supply Analysis: Overview of Pakistan

Source: Economic Survey 2010 – 2011 Source: Economic Survey 2010 – 2011

Source: SBP Website

Page 13: SFA Meat Industry Research Report

13

Province Name

Cattle Buffaloes Sheep Goats Poultry

Punjab 16,711,848 19,990,672 6,666,615 22,069,396 27,616,195

Sindh 8,029,928 8,267,924 4,148,195 13,991,265 15,068,745

Balouchistan 2,613,146 360,282 13,417,779 13,114,868 6,301,559

KPK 6,920,078 2,171,121 3,524,412 10,682,471 29,523,502

Total 34,275,000 30,790,000 27,757,000 59,858,000 78,510,000

Pakistan Animal Supply Analysis: Province Wise

Source: Economic Survey 2010 – 2011

Page 14: SFA Meat Industry Research Report

Administrative Unit (Punjab) Cattle Buffalo Sheep Goats Poultry

Islamabad District 59,349 95,095 854 85,594 192,426

Rawalpindi District 398,497 279,062 17,849 544,361 1,136,360

Attock District 447,810 136,720 189,618 699,598 1,015,310

Jehlum District 193,391 164,191 62,088 337,396 351,547

Chakwal District 504,725 163,888 165,703 646,001 873,017

Gujran Wala District 260,739 707,522 90,368 192,589 748,632

Hafiza Bad District 212,315 563,835 24,415 119,703 487,026

Gujrat District 168,698 465,848 37,315 231,575 293,516

Mandi Bahawul Din District 261,808 640,308 17,270 203,692 601,692

Sialkot District 317,292 688,186 91,161 178,692 394,962

Narowal District 181,221 350,141 20,131 196,768 267,019

Lahore District 156,864 454,082 42,645 130,796 297,481

Kasor District 452,322 1,221,581 103,461 407,079 680,444

14

Pakistan Animal Supply Analysis: District Wise (Punjab No. of Heads)

Page 15: SFA Meat Industry Research Report

Province Wise RankingAdministrative Unit (Punjab) Cattle Buffaloe Sheep Goats Poultry

Okara District 381,995 991,651 95,116 396,616 568,249

Sheikhupora District 327,946 598,141 78,964 204,929 599,070

Nankana Sahib District 151,551 451,709 41,023 284,449 460,996

Faisala Bad District 534,127 1,292,636 57,377 1,007,057 942,807

Toba Tek Singh District 316,943 494,382 49,356 560,518 427,283

Jhang District 1,012,080 1,323,706 403,501 1,120,653 1,519,329

Sargodha District 666,612 774,605 140,800 653,977 954,156

Khushab District 400,012 189,668 175,277 588,905 619,812

Mian Wali District 529,658 216,018 240,760 560,716 814,447

Bhakkar District 624,162 293,750 481,561 729,792 1,087,533

Multan District 578,093 469,137 84,594 661,378 778,090

Loodhran District 424,393 262,815 38,453 476,705 532,319

Vihari District 401,215 690,737 105,600 707,169 715,852

Jhang District has the largest

population of Buffaloes while second largest

Population of Cattle in Punjab, Located at the center of Punjab

15

Supply Analysis: Pakistan – District Wise ( Punjab )

Jhang District has the largest

population of Buffaloes while second largest

population of Cattle in Pakistan.

Country Wise Ranking

Pakistan Animal Supply Analysis: District Wise (Punjab No. of Heads)

Source: Pakistan Census Survey 2006 figures adjusted for Economic Survey 2010 – 2011 figures

Page 16: SFA Meat Industry Research Report

Administrative Unit (Punjab) Cattle Buffalo Sheep Goats Poultry

Sahiwal District 276,480 755,309 52,907 531,710 613,042

Pakpattan District 222,180 654,466 61,281 353,111 434,778

Khanewal District 491,692 637,786 163,105 792,622 867,580

D G khan District 571,328 246,402 675,944 955,330 1,117,878

De Ex Area of D.G.Khan District 176,082 904 496,319 749,263 430,062

Rajanpur District 431,700 225,599 410,696 705,031 704,242

De Ex Area of Rajanpur District 15,368 - 168,829 71,613 26,632

Layyah District 674,679 339,349 529,500 635,946 974,872

Muzafargarh District 1,359,470 676,647 362,894 1,177,505 1,708,315

Bahawalpur District 638,306 686,261 167,695 1,162,641 1,059,971

Bahawalnager District 630,259 853,876 205,193 1,065,308 1,041,534

Rahim Yar Khan District 602,431 923,480 143,904 1,656,285 1,186,309

Cholistan District 658,058 11,177 373,084 286,325 91,608

Grand Total 16,711,848 19,990,672 6,666,615 22,069,396 27,616,195

16

Muzafargarh District has the largest

population of Cattle while second largest population of Poultry

in Pakistan. Strategically located near Sindh Province

Muzafargarh District has the largest

population of Cattle and Poultry in

Punjab. It is located in the Southern Belt

of Pakistan near Rahim Yar Khan

Province Wise Ranking

Country Wise Ranking

Pakistan Animal Supply Analysis: District Wise (Punjab No. of Heads)

Source: Pakistan Census Survey 2006 figures adjusted for Economic Survey 2010 – 2011 figures

Page 17: SFA Meat Industry Research Report

Administrative Unit (Sindh) Cattle Buffalo Sheep Goats Poultry

Hyderabad District 88,687 348,240 30,530 329,368 336,233

Badin District 365,687 561,230 233,761 643,572 651,934

Thatta District 476,129 413,519 169,900 391,025 1,037,522

Dadu District 543,601 434,769 297,325 890,368 853,422

Jamshoro District 189,856 133,748 179,978 460,941 300,423

Tando Allah Yar District 67,427 156,821 17,945 236,633 255,036

Matiari District 309,492 264,346 54,350 367,251 227,924

Tando Muhammad Khan District 66,577 177,896 25,394 151,647 255,302

Mirpur Khas District 233,688 263,968 71,177 741,186 389,343

Umer Kot District 228,789 110,209 156,146 596,930 191,825

Ghotki District 326,643 277,995 77,025 417,224 466,114

Sanghar District 429,307 364,437 87,584 775,208 466,216

Sukkur District 245,388 221,342 49,747 277,760 463,754

17

Pakistan Animal Supply Analysis: District Wise (Sindh No. of Heads)

Page 18: SFA Meat Industry Research Report

Administrative Unit (Sindh) Cattle Buffalo Sheep Goats Poultry

Tharparkar District 872,291 52,184 1,241,346 2,468,211 280,822

Khair Pur District 572,155 594,596 114,971 1,002,100 1,544,768

NawabShah District 393,306 439,586 106,689 976,555 920,131

Naushero Feroz District 388,170 597,587 54,035 913,024 993,535

Larkana District 250,694 598,487 54,740 276,056 948,556

Shahdad Kot District 266,253 422,547 167,602 391,077 1,201,241

Shikar Pur District 592,578 619,102 307,531 380,662 1,136,063

Jaccoba Bad District 588,173 528,484 387,408 583,585 1,131,266

Kashmore District 221,326 220,440 144,973 164,729 553,891

Karachi District 313,714 466,391 118,038 556,152 463,423

Grand Total 8,029,928 8,267,924 4,148,195 13,991,265 15,068,745

18

Tharparkar has the largest population of

Goats while third largest population of

Cattle & Sheep . Khair Pur has the

fourth largest population of Poultry.

Tharparkar has the largest population of Cattle, Sheep & Goat

in Sindh, while Shikarpur & Khair

Pur have the largest population of

Buffaloes & Poultry respectively

Province Wise Ranking

Country Wise Ranking

Pakistan Animal Supply Analysis: District Wise (Sindh No. of Heads)

Page 19: SFA Meat Industry Research Report

Administrative Unit (Balochistan) Cattle Buffalo Sheep Goats Poultry

Quetta District 13,038 28,776 171,648 133,972 136,803

Pishin District 106,021 1,120 877,352 561,455 566,856

Killa Abdullah District 61,585 540 340,595 128,431 310,968

Chagai District 7,625 23 215,583 333,153 99,066

Sibi Distrcit 63,438 6,908 210,575 231,625 271,413

Kohlu District 201,956 1,648 1,369,351 905,404 183,848

Dera Bugti District 167,973 7,654 530,346 862,877 197,671

Ziarat District 2,237 14 125,807 154,066 53,726

Loralai District 152,836 5,213 822,575 369,181 269,599

Musa Khel District 228,801 1,859 1,024,600 516,513 242,807

Barkhan District 135,999 2,258 433,671 173,142 166,210

Killa Saifullah District 80,428 170 1,117,804 872,073 292,423

Pakistan Animal Supply Analysis: District Wise (Balochistan No. of

Heads)

Page 20: SFA Meat Industry Research Report

Administrative Unit (Balochistan) Cattle Buffalo Sheep Goats Poultry

Zhob District 207,163 6,222 1,231,027 974,789 244,952

Jafara Bad District 311,596 176,199 253,014 315,969 540,764

Naseera Bad District 192,213 94,872 155,617 237,369 311,500

Bolan District 175,946 4,676 130,538 852,581 375,857

Jhal Magsi District 90,786 4,815 64,232 332,400 168,177

Lasbella District 117,212 8,989 384,861 883,949 241,677

Mastung District 10,005 514 489,267 372,707 233,119

20

Zhob District has the 11th largest

population of Goats while third largest

population of Sheep in Pakistan.

Jafarabad Districthas the largest population of

Cattle, and buffaloes while Kohlu and

khuzdar District have the largest

population of Sheep and Goat

Province Wise Ranking

Country Wise Ranking

Pakistan Animal Supply Analysis: District Wise (Balochistan No. of

Heads)

Page 21: SFA Meat Industry Research Report

Administrative Unit (Balochistan) Cattle Buffalo Sheep Goats Poultry

Kalat Distrct 36,985 667 1,298,894 898,764 353,898

Khuzdar District 119,869 6,513 1,158,380 1,152,939 358,626

Awaran District 21,434 45 131,799 383,182 118,846

Kharan District 17,224 133 697,812 707,487 215,581

Kech (Turbat) District 50,363 345 67,793 506,792 222,527

Gawadar District 14,314 57 19,243 98,935 56,385

Panjur District 26,099 55 95,394 155,115 68,259

Grand Total 2,613,146 360,282 13,417,779 13,114,868 6,301,559

21

Kalat District has the 2nd largest

population of Sheep in Pakistan.

Khuzdar District has the fifth largest

population of Goats

Khuzdar District has the 5th largest population of

poultry in Balochistan, while

Kalat District has the 2nd largest

population of Sheep and 4th largest

population of goats

Province Wise Ranking

Country Wise Ranking

Pakistan Animal Supply Analysis: District Wise (Balochistan No. of

Heads)

Page 22: SFA Meat Industry Research Report

Administrative Unit (KPK) Cattle Buffalo Sheep Goats Poultry

Peshawar District 258,754 161,616 70,429 295,214 2,064,431

Nowshera District 221,091 120,403 73,403 219,728 956,248

Charsadda District 278,176 124,689 49,560 192,762 1,234,015

Mardan District 286,926 130,483 54,067 224,058 1,674,656

Sowabi District 235,477 116,656 15,578 182,177 1,234,545

Kohat District 202,109 30,725 114,265 326,465 758,499

Hangu District 81,692 10,724 8,734 100,906 442,934

Karak District 246,400 2,314 35,153 324,207 695,826

D I Khan District 477,077 231,625 260,398 649,831 1,364,588

Tank District 77,811 20,247 81,687 134,288 223,617

Bannu District 195,880 63,282 96,580 246,971 1,531,907

Laki Marwat District 114,274 4,311 51,030 324,637 731,354

Abbotta Bad District 129,192 117,801 13,737 272,720 824,133

Pakistan Animal Supply Analysis: District Wise (KPK No. of Heads)

Page 23: SFA Meat Industry Research Report

23

Kohistan District has the 2nd largest

population of Goats in KPK, and 3th

largest population of cattle in KPK. Siwat has the 2nd largest population of cattle

in KPK

Province Wise Ranking

Country Wise Ranking

Administrative Unit (KPK) Cattle Buffalo Sheep Goats Poultry

Nari Pur District 150,991 120,424 7,130 239,933 729,031

Mansehra District 211,007 215,214 90,885 352,512 1,080,502

Battagram District 138,797 88,121 16,012 136,509 721,301

Kohistan District 290,943 57,630 205,927 747,130 563,438

Siwat District 294,283 131,902 83,884 262,892 1,217,050

Shanglapar District 237,646 145,351 62,278 266,898 955,183

District 153,044 89,711 33,438 145,728 786,468

Chitral District 202,739 333 189,826 387,254 451,724

Upper Dir District 269,031 5,591 95,601 392,274 760,604

Lower Dir District 288,737 18,313 50,244 325,558 1,118,882

F R Peshawar 26,441 389 25,650 128,913 229,296

F R Kohat 18,978 294 7,304 58,378 118,030

F R D.I.Khan 121,184 420 175,881 221,567 70,825

Seven out of top ten Districts in terms of

largest population of Poultry are from KPK

including Peshawar, Mardan,

Bannu, Khyber Agency and D.I.Khan

Pakistan Animal Supply Analysis: District Wise (KPK No. of Heads)

Page 24: SFA Meat Industry Research Report

24

F.R. Bannu is ranked 57th in the country in terms of sheep

population, while it has the 27th largest population of Goats

in the country

F.R.Bannu has the 2nd largest

population of Goats in KPK, while

Mansehra District has the 2nd largest

population of Buffaloes in the KPK

province

Province Wise Ranking

Country Wise Ranking

Administrative Unit (KPK) Cattle Buffalo Sheep Goats Poultry

F R bannu 112,974 12,978 134,603 711,778 503,274

F R Mansehra 37,945 36,627 16,222 84,223 104,260

F R Kurrum 120,976 1,577 145,011 227,749 542,316

F R Tank 59,051 964 112,592 122,646 154,755

F R Laki Marwat 75,279 - 41,310 117,496 153,919

Malakand Agency 85,882 22,027 6,212 71,848 269,795

Bajour Agency 153,379 17,129 55,566 192,925 743,400

Khyber Agency 180,678 11,573 199,605 588,873 1,404,877

Mohmand Agency 269,647 3,874 140,303 420,938 1,099,653

Kurrum Agency 140,836 3,572 80,373 126,409 565,652

Aurakzai Agency 74,601 14,619 50,512 120,114 373,890

North Waziristan Agency 244,063 21,082 244,753 293,775 538,895

South Waziristan Agency 156,089 16,532 328,668 444,188 529,730

Grand Total 6,920,078 2,171,121 3,524,412 10,682,471 29,523,502

Pakistan Animal Supply Analysis: District Wise (KPK No. of Heads)

Page 25: SFA Meat Industry Research Report

25

Southern Punjab Highest Animal Concentration

Pakistan Animal Supply Analysis: Freight Cost

Source: Primary Research

Page 26: SFA Meat Industry Research Report

Supply of Cattle grew at CAGR of 3.99% , while Supply of Buffaloes grew at CAGR of 3.16% for the period FY 2006 – 2010

Supply of Sheep grew at CAGR of 1.2%, while Supply of Goats grew at CAGR of 2.82% for the period FY 2006 – 2010

Supply of Poultry grew at CAGR of 1.65% , while Total Meat Supply grew at CAGR of 2.56% for the period FY 2006 – 2010

Although for the period FY 2006 – 2010 animal CAGR is recorded at 2.56%, however going forward we assume that it will belower in comparison with the historic number due to the regime change

Regime change is caused by the current hype in meat prices that occurred due to the start of meat export, the regimechange is explained in the following diagram

Regime Change

26

Male Animals

Female Dairy Animals

Female Breeding Animals

Historical Trend Historically majority of animal used for

Meat consumption were only taken from Male animals or Dairy or Breeding animals that were old were used

Regime Change However due to current hike in prices what

happened was that animal stockholders notonly sell male animals but also Breedinganimals and Dairy animals , which will causea Supply Shock in the future period

Pakistan Animal Supply Analysis: Forecast (Regime change causing Supply

Shock)

Page 27: SFA Meat Industry Research Report

27

Table of Content

1. Global Meat Industry

2. Global Halal Food Industry

3. Pakistan Animal Supply Analysis

4. Pakistan Meat Demand Analysis

5. Regional Analysis

6. Meat Shop in Lahore A Case Study

7. Investment Highlights

Page 28: SFA Meat Industry Research Report

Beef and Veal meat demand in Pakistan remained stablebetween 2005 and 2010. On an average Pakistan hasconsumed 1,333 KT of Beef and Veal per year.

Sheep meat demand has decreased in 2010 because ofunexpected increase in price during that period. In 2010consumption of Sheep meat in Pakistan was 392 KT

Poultry demand in Pakistan have had an increasing trendfrom 2005 to 2010 . Demand declined in 2010 because ofartificial increase in prices of Poultry meat. Bird flu inChicken is also negatively impacting demand of poultrymeat

28

-

200

400

600

800

1,000

1,200

1,400

1,600

2005 2006 2007 2008 2009 2010

"00

0"M

T

Beef and Veal Demand 2005 - 2010

-

100

200

300

400

500

600

2005 2006 2007 2008 2009 2010

"00

0"M

T

Sheep Meat Demand 2005 - 2010

-

100

200

300

400

500

600

700

800

2005 2006 2007 2008 2009 2010

"00

0"M

T

Poultry Meat Demand 2005 - 2010

Pakistan Meat Demand Analysis: Historic

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

Page 29: SFA Meat Industry Research Report

Regression Analysis is the methodology adopted by SFA todetermine future demand forecast

In order to predict future Demand, historic Demand wasregressed against various variables that were expected toeffect Meat Demand such GDP Per Capita, Historic MeatPrices, Population Growth Rate etc

Regression results indicate that Meat Demand is highlysensitive to GDP Per Capita and Average Price of Meat

For unit change in GDP Per Capita and Average Price MeatDemand increases by 0.83 and -0.0015 units respectively

29

Pakistan Meat Demand Analysis: Regression for Demand Forecast

-

500

1,000

1,500

2,000

2,500

3,000

-

50,000

100,000

150,000

200,000

2004 2005 2006 2007 2008 2009 2010

Demand Vs Average Price

Average Price Demand

2004 2005 2006 2007 2008 2009 2010

-

500

1,000

1,500

2,000

2,500

3,000

"00

0"

MT

Predicted Demand Vs Actual Demand

Predicted Demand Actual Demand

Meat Demand = 365.1407-0.00151 * (Average Price)+0.83246 * (GDP Per Capita)

R Square = 0.91

-

500

1,000

1,500

2,000

2,500

3,000

2004 2005 2006 2007 2008 2009 2010

Meat Demand Vs GDP per Capita

Demand Gdp per CapitaSource: OECD FAO, Economics Survey of Pakistan Source: OECD FAO

Source: OECD FAO

Page 30: SFA Meat Industry Research Report

Beef and Veal Meat Demand, Sheep Meat Demand

and Poultry Meat Demand in Pakistan is expected

to rise with a CAGR of ~2.8% assuming the

relationship discovered through regression holds

and assuming Per Capita Growth Rate of 4.19%

per annum and Meat Price inflation of 10% per

annum for the period 2011 – 2010

30

Pakistan Meat Demand Analysis: Meat Demand Forecast

1,400

1,450

1,500

1,550

1,600

1,650

1,700

2011 2012 2013 2014 2015

"00

0"M

T

Beef and Veal Meat Demand Forecast2011 – 2015

390 400 410 420 430 440 450 460 470 480

2011 2012 2013 2014 2015

"00

0"M

T

Sheep Meat Demand Forecast2011 – 2015

520

540

560

580

600

620

640

2011 2012 2013 2014 2015

"00

0"M

T

Poultry Meat Demand Forecast2011 – 2015

Page 31: SFA Meat Industry Research Report

31

Table of Content

1. Global Meat Industry

2. Global Halal Food Industry

3. Pakistan Animal Supply Analysis

4. Pakistan Meat Demand Analysis

5. Regional Analysis

6. Meat Shop in Lahore A Case Study

7. Investment Highlights

Page 32: SFA Meat Industry Research Report

32

Top 4 Beef exporting countries that export to theMena region are depicted in the graph, currentlyBrazil has the highest Market share in Beef exportsto the region

In Sheep Meat exporting countries, Australia is atthe top with the figures of 412, 559 MT in 2010

Top 4 Poultry meat exporting countries areBrazil, Australia, India and Pakistan. Pakistan is atthe 4 spot with 149 MT of Poultry meat exportedby Pakistan in 2010

Regional Analysis: Top Exporting Countries

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

3,678.8

32.3 4.7 0.1 0

1,000

2,000

3,000

4,000

Brazil Australia India Pakistan

"00

0"M

T

Top 4 Poultry Exporting Countries

1,860

1,472

700

20 -

400

800

1,200

1,600

2,000

Brazil Australia India Pakistan

"00

0"M

T

Top 4 Beef Exporting Countries

412.6

23.6 8.0 0.0 0

100

200

300

400

500

Australia India Pakistan Brazil

"00

0"M

T

Top 4 Sheep Exporting Countries

Page 33: SFA Meat Industry Research Report

33

Beef and Veal meat live cost has historicallyshown an upward trend. Prices rose from668 USD/MT to 1,132 USD/MT from 2004 to2008

Similar trend can be seen in Sheep meatprices. In 2008 cost for producers was 1,307USD/MT

Brazil is the top Poultry meat exporter withthe live cost of 1,247 USD/MT in 2008

Regional Analysis: Major Exporters – Brazil (Cost Analysis)

-

200

400

600

800

1,000

1,200

2004 2005 2006 2007 2008

USD

/ M

T

Beef and Veal Historic Live Cost

-

200

400

600

800

1,000

1,200

1,400

2004 2005 2006 2007 2008

USD

/ M

T

Sheep Meat Historic Live Cost

-

200

400

600

800

1,000

1,200

1,400

2004 2005 2006 2007 2008

USD

/ M

T

Poultry Historic Live Cost

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

Page 34: SFA Meat Industry Research Report

34

Price of Beef and Veal meat was at its peak in 2008

with the figure of 2,310 USD/MT

Price of Sheep meat also rose gradually from 1470

USD/MT in 2004 to 2467 USD/MT, in 2008

Poultry meat prices were 522, 649, 1,096, 1,384

and 1,619 USD/MT from 2004 to 2008 respectively

Regional Analysis: Major Exporters – Brazil (Price Analysis)

-

500

1,000

1,500

2,000

2,500

2004 2005 2006 2007 2008

USD

/ M

T

Beef and Veal Meat Historic Price

-

500

1,000

1,500

2,000

2,500

3,000

2004 2005 2006 2007 2008

USD

/ M

T

Sheep Meat Historic Prices

-

400

800

1,200

1,600

2,000

2004 2005 2006 2007 2008

USD

/ M

T

Poultry Meat Historic Prices

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

Page 35: SFA Meat Industry Research Report

35

For brazil, future of Beef and Veal meat export

looks optimistic. In 2011, Beef and Veal meat

export quantity is forecasted to be 1,883 KT. Major

jump in Brazilian Beef and Veal meat is expected to

come in 2015 when brazil is expected to export

1,990 KT. CAGR is forecasted to be almost 2% for

Brazilian Beef and Veal meat export

Poultry meat export figures are forecasted to be

3,426, 3,346, 3,464, 3,509 and 3,740 thousand MT

from 2011 to 2015 respectively. Except for year

2011, where the exports are expected to

decline, Brazilian Poultry meet growth is forecasted

to be positive

Regional Analysis: Major Exporters – Brazil (Exports Forecast)

1,800

1,840

1,880

1,920

1,960

2,000

2011 2012 2013 2014 2015

“00

0”M

T

Beef and Veal Meat Export Forecasted

3,000

3,200

3,400

3,600

3,800

2011 2012 2013 2014 2015

“00

0”M

T

Poultry Meat Export Forecast

Source: OECD FAO

Source: OECD FAO

Page 36: SFA Meat Industry Research Report

36

In Australia cost of producing Beef and Veal meatwas 1,131 USD/MT in 2004, while in 2008 live costwas 1,323 USD/MT

Sheep meat price had a downward trend from2004 to 2007, but price rose considerably in 2008with the figure of 1,136 USD/MT

Poultry meat live cost rose gradually from 996USD/MT in 2004 to 1,319 USD/MT in 2008

Regional Analysis: Major Exporters – Australia (Cost Analysis)

-

300

600

900

1,200

1,500

2004 2005 2006 2007 2008

USD

/ M

T

Beef and Veal Historic Live Cost

1,020

1,050

1,080

1,110

1,140

1,170

2004 2005 2006 2007 2008

USD

/ M

T

Sheep Meat Historic Live Cost

-

300

600

900

1,200

1,500

2004 2005 2006 2007 2008

USD

/ M

T

Poultry Historic Live Cost

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

Page 37: SFA Meat Industry Research Report

37

Beef and Veal meat prices showed mixedtrend historically. Prices were highest in2007 and lowest in 2004.

Sheep meat prices rose steadily from 4,843to 5,823 USD/MT from 2004 to 2008

Poultry meat prices were highest in 2008and lowest in 2006. In 2008 prices were1,709 USD/MT

Regional Analysis: Major Exporters – Australia (Price Analysis)

-

600

1,200

1,800

2,400

3,000

2004 2005 2006 2007 2008

USD

/ M

T

Beef and Veal Meat Historic Price

-

1,200

2,400

3,600

4,800

6,000

7,200

2004 2005 2006 2007 2008

USD

/ M

T

Sheep Meat Historic Prices

-

300

600

900

1,200

1,500

1,800

2004 2005 2006 2007 2008

USD

/ M

T

Poultry Meat Historic Prices

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

Page 38: SFA Meat Industry Research Report

38

Australian Beef and Veal meat export quantity is

expected to have a positive growth rate.

Forecasted export quantity of Beef and Veal meat

shows an upward trend from 2011 to 2015. It is

expected that in 2015 export quantity will reach

1,516 thousand MT

Forecast for Sheep meat export also shows the

same trend for Australia. The forecasted Australian

Sheep meat export is 423 thousand MT, whereas in

2015 it is expected that exports will increase to

approximately 455 thousand MT, as show in the

graph

Regional Analysis: Major Exporters – Australia (Exports Forecast)

1,380

1,410

1,440

1,470

1,500

1,530

2011 2012 2013 2014 2015

“00

0”M

T

Beef and Veal Meat Export Forecasted

400

410

420

430

440

450

460

2011 2012 2013 2014 2015

“00

0”M

T

Sheep Meat Export Forecasted

Source: OECD FAO

Source: OECD FAO

Page 39: SFA Meat Industry Research Report

39

Regional Analysis: Major Exporters – India (Price Analysis)

-

500

1,000

1,500

2,000

2004 2005 2006 2007 2008

USD

/ M

T

Sheep Meat Historic Live Cost

-

1,000

2,000

3,000

4,000

2004 2005 2006 2007 2008

USD

/ M

T

Sheep Meat Historic Prices

-

400

800

1,200

1,600

2004 2005 2006 2007 2008

USD

/ M

T

Poultry Historic Live Cost

-

500

1,000

1,500

2,000

2,500

2004 2005 2006 2007 2008

USD

/ M

T

Poultry Meat Historic Prices

Source: OECD FAO Source: OECD FAO

Source: OECD FAOSource: OECD FAO

Page 40: SFA Meat Industry Research Report

40

India is expected to increase its share of Beef and

Veal meat in global market, forecasted results

show an upward trend. Growth rate is positive

from 2011 to 2014. However, due to religious

factors, the exports are expected to be

volatile, since, Hindu activists are protesting to

cease Cattle slaughtering through legislation. If this

happens, there will be a big gap created in supply

and demand of beef in global market

In 2011 Sheep meat export is expected to be 23

KT. it will rise gradually and by 2015 it is expected

that India will export 31 KT of Sheep meat.

However, Cumulative average growth is likely to be

at the lower side

Regional Analysis: Major Exporters – India (Exports Forecasted)

700

720

740

760

780

800

2011 2012 2013 2014 2015

"00

0"M

T

Beef and Veal Meat Export Forecasted

-

5

10

15

20

25

30

35

2011 2012 2013 2014 2015

"00

0"M

T

Sheep Meat Exports Forecasted

Source: OECD FAO

Source: OECD FAO

Page 41: SFA Meat Industry Research Report

41

Cost of Beef and veal meat have increasedgradually for Pakistani producers. Prices were 736USD/ MT in 2005 and then steadily climbed to875USD/ MT in 2008

Sheep Meat cost for producers remained relativelyat the same level from 2004 to 2008, except for2007, when it was at 1125 USD/MT

Poultry meat cost in 2007 was 790 USD/MTwhereas in 2008 it increased to 852 USD/MT

Regional Analysis: Major Exporters – Pakistan (Cost Analysis)

-

300

600

900

1,200

2004 2005 2006 2007 2008

USD

/ M

T

Sheep Meat Historic Live Cost

-

200

400

600

800

1,000

2004 2005 2006 2007 2008

USD

/ M

T

Poultry Historic Live Cost

650

700

750

800

850

900

2004 2005 2006 2007 2008

USD

/ M

T

Beef and Veal Historic Live Cost

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

Page 42: SFA Meat Industry Research Report

42

Prices of Beef and Veal meat remained stable from2004 to 2006. In 2007 however, it jumped up to1,750 USD/ MT whereas in 2008 price rose to1,890 USD/MT

In 2007 price was 2,249 USD/MT for Sheep meatbut in 2008 , it dropped to 1,957 USD/MT

Poultry meat prices showed a gradual increase inits price from 915 USD/MT in 2004 to 1,151USD/MT in 2008.

Regional Analysis: Major Exporters – Pakistan (Price Analysis)

-

500

1,000

1,500

2,000

2004 2005 2006 2007 2008

USD

/ M

T

Beef and Veal Meat Historic Price

-

500

1,000

1,500

2,000

2,500

2004 2005 2006 2007 2008

USD

/ M

T

Sheep Meat Historic Prices

-

200

400

600

800

1,000

1,200

1,400

2004 2005 2006 2007 2008

USD

/ M

T

Poultry Meat Historic Prices

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

Page 43: SFA Meat Industry Research Report

43

In 2010, Pakistan exported 20 KT of Beef and Veal

meat. Forecasted figures for 2011 is 27 thousands

MT, which means a growth rate of almost 35%.

After 2012, it is expected that Pakistani Beef and

Veal meat exports will decrease in the global

market. In 2015 it is expected that Pakistan will

export 26 thousand MT of Beef and Veal meat.

Forecasted figure for 2011 is 8 thousand MT for

Sheep meat export which is same as what Pakistan

exported in 2010. Major export surge in Sheep

meat is likely to come in 2014, when Pakistan will

export approximately 8.5 KT of Sheep meat across

the globe

Regional Analysis: Major Exporters – Pakistan (Exports Forecast)

-

10

20

30

40

2011 2012 2013 2014 2015

"00

0"M

T

Beef and Veal Meat Export Forecasted

4

5

6

7

8

9

2011 2012 2013 2014 2015

"00

0"M

T

Sheep Meat Exports Forecasted

Source: OECD FAO

Source: OECD FAO

Page 44: SFA Meat Industry Research Report

44

In 2008 Pakistan had a comparative advantage ofbeing a low cost producer of Beef and Veal meat.Results also show that Brazil and Australia weresuffering from high cost of producing Beef andVeal meet

India has the highest cost of Sheep meat whereasPakistan has lowest cost of 978 USD/MT

Poultry meat stats for 2008 also showed the sametrend, India cost of Poultry meat was highestwhereas Pakistan cost was lowest in top fourExporting countries

Regional Analysis: Comparative Analysis – Exporters (Cost

Analysis)

-

500

1,000

1,500

2,000

Pakistan India Brazil Australia

USD

/ M

T

Sheep Meat Historic Live Cost Comparison 2008

-

400

800

1,200

1,600

Pakistan India Brazil Australia

USD

/ M

T

Poultry Historic Live Cost Comparison 2008

-

300

600

900

1,200

1,500

Pakistan India Brazil Australia

USD

/ M

T

Beef and Veal Historic Live Cost Comparison 2008

N /A

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

Page 45: SFA Meat Industry Research Report

45

Australia was charging the highest price of 2,646 in2008 whereas Pakistan was charging the lowestprice of 1,890 USD/ MT

Australia’s Sheep meat price was 5,828 USD/MTwhereas Pakistani Sheep meat price was 1,957USD/MT

In 2008, Indian Poultry meat price was highestamongst the top 4 exporting countries whereasPakistani poultry meat prices ware lowest. Becauseof their low cost they were able to sell Poultry atlower prices

Regional Analysis: Comparative Analysis – Exporters (Price

Analysis)

-

750

1,500

2,250

3,000

Pakistan India Brazil Australia

USD

/ M

T

Beef and Veal Meat Historic Price Comparison 2008

-

1,500

3,000

4,500

6,000

7,500

Pakistan India Brazil Australia

Sheep Meat Historic Prices Comparison 2008

-

500

1,000

1,500

2,000

2,500

Pakistan India Brazil Australia

Poultry Meat Historic Prices Comparison 2008

N /A

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

Page 46: SFA Meat Industry Research Report

46

Following Margins were calculated by subtractinglive animal cost from local retail prices:

Australia was enjoying the highest margins in2008, whereas Pakistani Beef and veal meat margins wereat the lower side, shown by the figure of 1,015 USD/MT

Australian Sheep meat had the highest margins in 2008whereas Pakistani Sheep meat had the lowest margins forthe same year.

In poultry meat India had the highest margins whereasAustralia held the 2nd spot in 2008 with the margins of396USD/MT

Regional Analysis: Comparative Analysis – Exporters (Local

Markets Margins Analysis)

-

200

400

600

800

1,000

1,200

1,400

Pakistan India Brazil Australia

USD

/ M

T

Beef and Veel Meat Margins Analysis2008

-

1,000

2,000

3,000

4,000

5,000

Pakistan India Brazil Australia

USD

/ M

T

Sheep Meat Margins Analysis2008

-

100

200

300

400

500

600

Pakistan India Brazil Australia

USD

/ M

T

Poultry Meat Margins Analysis2008

N /A

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

Page 47: SFA Meat Industry Research Report

47

Beef and Veal Meat prices increased steadilyduring the period of 2004-2008 in the kingdom ofSaudi Arabia by almost 27%

Sheep meat prices were highest in 2008 in KSA.In 2008 price of Sheep meat was 7,687 USD/MT

Poultry meat prices went on a roller coaster riderising from 1,513 in 2004 to 1,907 in2008, showing higher demand and acute supplyof poultry meat

Regional Analysis: Major Importers – KSA (Price Analysis)

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

2004 2005 2006 2007 2008

USD

/ M

T

Beef and Veal Meat Historic Prices

-

1,000

2,000

3,000

4,000

5,000

6,000

7,000

8,000

9,000

2004 2005 2006 2007 2008

USD

/ M

T

Sheep Meat Historic Prices

-

500

1,000

1,500

2,000

2,500

3,000

2004 2005 2006 2007 2008

USD

/ M

T

Poultry Meat Historic Prices

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

Page 48: SFA Meat Industry Research Report

48

Consumption of Beef and Veal is expected toincrease in KSA which will lead to the increase inimport quantity of Beef and Veal meat.Forecasted import quantity for 2011 is 110 KT.

Sheep meat imports will increase during 2011 to2015. Market analysis shows that there will be asignificant surge expected to come in 2014, whenKSA will import almost 116 KT of Sheep meat

It is expected that poultry meat imports will risegradually in KSA and Cumulative average growthrate will be almost 2% during 2011 to 2015

Regional Analysis: Major Importers – KSA (Imports Forecasted)

105

110

115

120

2011 2012 2013 2014 2015

"00

0"M

T

Beef and Veal Meat Imports Forecasted

90

100

110

120

2011 2012 2013 2014 2015

"00

0"M

T

Sheep Meat Imports Forecated

600

650

700

750

800

2011 2012 2013 2014 2015

"00

0"M

T

Poultry Meat Imports Forecasted

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

Page 49: SFA Meat Industry Research Report

49

Price of Beef and Veal meat in Malaysia was 3,641USD/MT in 2004. After that price swelled gradually inMalaysia and in 2008 price of Beef and Veal meet was5,059 USD/MT, an increment of 39% from 2004 prices

Sheep meat price was less than Beef and Veal price in2004, 2005, 2006 and 2007, but in 2008 Sheep meat priceof 5,211 USD/MT was greater than Beef price

Poultry meat prices were highest in 2008 and lowest in2004. Overall Poultry meat prices has witnessed a pricelift of 43% during the period of 4 years

Regional Analysis: Major Importers – Malaysia (Price Analysis)

-

1,500

3,000

4,500

6,000

2004 2005 2006 2007 2008

USD

/ M

T

Beef and Veal Meat Historic Prices

-

1,500

3,000

4,500

6,000

2004 2005 2006 2007 2008

USD

/ M

T

Sheep Meat Historic Prices

-

500

1,000

1,500

2,000

2004 2005 2006 2007 2008

USD

/ M

T

Poultry Meat Historic Prices

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

Page 50: SFA Meat Industry Research Report

50

It is expected that Beef and Veal meat consumption willincrease in Malaysia in near future. To meet demand, it isforecasted that Malaysia will import almost 164 thousandMT of Beef and Veal meet

Same trend is forecasted for Sheep meat imports. Importquantity will gradually increase during 2011 to 2015.In2011 it is expected that Malaysia will import almost 23thousand MT of Sheep meat (Check graph)

From 2011 to 2015, it is forecasted that Malaysia willimport 56, 55, 58, 56 and 58 thousand MT of poultrymeat respectively

Regional Analysis: Major Importers – Malaysia (Imports Forecasted)

154

161

168

175

182

2011 2012 2013 2014 2015

"00

0"M

T

Beef and Veal Meat Imports Forecasted

19

20

21

22

23

24

2011 2012 2013 2014 2015

"00

0"M

T

Sheep Meat Imports Forecated

54

55

56

57

58

2011 2012 2013 2014 2015

"00

0"M

T

Poultry Meat Imports Forecasted

Source: OECD FAO Source: OECD FAO

Source: OECD FAO

Page 51: SFA Meat Industry Research Report

51

Regional Analysis: Freight CostRegional Analysis: Freight Cost

Lahore to Dubai and Jeddah ,Air Freight PKR 56,000 / MT and PKR 57,000 / MT respectivelyKarachi to Dubai and Jeddah ,Air Freight PKR 54,000 / MT and PKR 55,000 / MT respectivelyLahore to Karachi, Refer Container, 16,000 / MT and Karachi to Lahore, Refer Container, 17,000 / MTKarachi to Dubai and Jeddah, Sea Freight, PKR 8,000 / MT and PKR 8,500 / MT

Karachi

Lahore

DubaiJeddah

Source: Primary Research

Page 52: SFA Meat Industry Research Report

52

Table of Content

1. Global Meat Industry

2. Global Halal Food Industry

3. Pakistan Animal Supply Analysis

4. Pakistan Meat Demand Analysis

5. Regional Analysis

6. Meat Shop in Lahore A Case Study

7. Investment Highlights

Page 53: SFA Meat Industry Research Report

Total Population

~10 Million

Young Population Range

( Below 30 Years)

~70%

Total Middle & Upper Class Population

~1.5 Million (Source: Global Health Facts)

53

Meat Shop in Lahore A Case Study: Market Need Assessment

Lahore Need Assessment

Time Constraints

Higher Working Class Population

Population Health Issues

Lower Medical Restrictions

Consumption Pattern

More On hand Disposable Income

Available

Dinning Out Trend

Higher trend of dinning out

Increased Demand

For Processed

Meat

Page 54: SFA Meat Industry Research Report

54

Branch in Lahore A Case Study: Pros & Cons

No brand recognition High operating cost New competitors entering

the Lahore market Hyper Markets selling each

and every grocery including fresh meat

Established Competitors: Zenith Meat Shop Neat Meat Lahore Meat company

Meat Shop in Lahore

Increase in Population High margins still enjoyed

by established competitors in Lahore Meat industry

Increase in population of migrants

Increase in average household income of Lahore

Life style changes Favorable Demographics

(Large % of young population)

RecommendationIn light of Pros & Cons

discussed, we recommend to open a Meat Shop in

Lahore

Page 55: SFA Meat Industry Research Report

55

Table of Content

1. Global Meat Industry

2. Global Halal Food Industry

3. Pakistan AnimalSupply Analysis

4. Pakistan Meat Demand Analysis

5. Regional Analysis

6. Meat Shop in Lahore A Case Study

7. Investment Highlights

Page 56: SFA Meat Industry Research Report

56

Key Investment Highlights

Still few Competitors, not engaged in price warwith each other

Favorable demographics in the local market.

Room is available in global market, industry canincrease its export to meet the demand ofMiddle East

Suppliers are not well organized so they do nothave much bargaining power

Export Quota approval required by GoP forexporting meat

Target County‘s government approval alsomandatory for exporting meat in some targetmarkets making it difficult for new exporters toenter the market

Setting up a distribution channel inDubai, allowing for exporting Meat viasea, there by lowering freight cost

Key Rewards

Low barriers of entry in Local Market

Standardize product

Threat of Substitute Products is also high.They have to keep their prices competitivewith that of ordinary butcher shops

Quality control standards

Export Quota Contraction by GoP

Threat of Import Ban imposition by targetmarket governments, in case any exporterfrom Pakistan exports substandard meat

Local Supply shock of live animal might hurtInternational Margins currently enjoyed byPakistani exporters

Key Risks