By Damion Mitchell, Staff ReporterTHE JAMAICA Livestock Association (JLA) on Thursday said it would be forced to increase the prices for its products if there were further hikes in operational costs.
"We are hoping that the raw material prices will come back down, but what we are doing now is that we are operating on a non-profit basis," Dr. John Masterton, JLA chairman told The Gleaner shortly after the company's annual general meeting at its Newport East offices in Kingston.
Earlier, Dr. Masterton had told company directors: "The year has been grim."
ANIMAL FEEDS
The JLA produces different types of animal feeds under its 'Supreme Feeds' brand markets eggs from its St. Catherine hatchery and distributes agricultural equipment from its 13 outlets.
In its annual report, the JLA said sales by the group in 2003 amounted to $798 million up from $600.4 million for the previous year, but it said last year's revenue provided only $4.06 million in profits.
In the meantime, Henry Rainford, Managing director of the JLA, said bad weather conditions have also impacted severely on the JLA's profitability as the Association had to dispose of more than 100,000 broiler chicks valued at $3 million following the recent heavy rains, because most small farmers did not turn up at the JLA outlets to collect the chicks they had ordered.
Mr. Rainford further explained that it was impossible for the JLA to keep the chicks after two days, as the entity did not have a suitable facility to do this.
DISAPPOINTMENTS
And turning to other 'commercial disappointments' Mr. Rainford said the price for Soya bean meal one of the main ingredients in animal feeds had increased from US $240 to US$440 per tonne in one year, while the price of corn rose from US$130 per tonne to just under US$200.
According to Mr. Rainford freight cost had also increased drastically. A small boat that previously cost US$35 per tonne was now incurring US$55, he said. But more significantly, there were considerable hikes in the price of oil resulting in the company now spending $1 million each month to purchase oil to be used in its feed manufacturing plant.
In the meantime, Mr. Rainford says the JLA has been retooling some of its operations, which include improving its management systems to encourage greater levels of profitability.
