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https://asia.nikkei.com/Business/Companies/Bangladesh-cattle-herds-surge-as-India-curbs-smuggling
October 21, 2017 6:30 pm JST
Bangladesh cattle herds surge as India curbs smuggling
Apparel makers seize on higher beef prices to set up farms
A.Z.M. ANAS, Contributing writer
Cattle producer Sadeeq Agro won attention when it sold a bull it had imported from Texas for around $20,000 during the Eid al-Adha festival in September. (Photo by A.Z.M. Anas)
DHAKA -- Moves by the Modi government in India to crack down on the country's previously strong beef industry in the name of protecting cows, holy to Hindus, have given new life to the sector in neighboring Bangladesh.
Until recently, the porous border between the two countries was the backdrop to a thriving illegal cattle trade. But India has clamped down on cattle smuggling over the last year, and the number of cows traded across the border has fallen to around 2 million from 3.5 million annually, according to Robiul Alam, secretary general of the trade group Bangladesh Meat Merchants' Association.
This has helped push up beef prices in predominantly Muslim Bangladesh by 18% over the past year, with demand for meat growing with rising incomes. Per capita income topped $1,600 in the fiscal year ended June, doubling from the level five years before. Growing wealth and an expanding economy, which grew 7.2% in the year ended June 30, has created demand for meat. With this enticement, conglomerates previously focused on garment production such as ABA Group and other companies have been pouring substantial money into the livestock sector.
"What is significant is that cattle farmers have got fair prices in the last three years," said A.B.M. Khaleduzzaman, a senior official in the Bangladesh Department of Livestock Services. "This indicates local entrepreneurs are motivated."
Cattle at Sadeeq Agro’s farm near Dhaka (Photo by A.Z.M. Anas)
India's anti-smuggling campaign "has definitely become a blessing for us," said Shah Emran, general-secretary of the Bangladesh Dairy Farmers' Association. "It has created demand for domestic cattle."
Government data show that the number of cattle farms in Bangladesh has swelled to 522,000 from just over 33,000 in 2011. The industry now accounts for nearly a quarter of overall employment.
ABA Group is plowing a further $123 million into a cattle farm at Louhajang, 50km south of Dhaka, where it already has a cattle-fattening facility. It will bring in 2,000 cows from the Netherlands and could invest as much as $200 million in the sector.
"People want to eat quality meat," said Gias Ahamad, chief executive officer of Winning Agro, a Dhaka-based consultancy advising ABA. Winning Agro also owns a one-tenth stake in the project. Ahamad said ABA is seeking foreign investors too. The cattle farm will stretch over 900 acres and will feature technology for tracking cows from birth to slaughter.
Likewise, Eon Group, which already has interests in poultry and animal health, is expanding into cattle. Eon said it would pump $12 million into a farm in the northern Rangpur region, procuring 500 cows from Australia.
Akij Group, one of the largest conglomerates in the country, is also flirting with the idea of investing $6 million in cows. The company, which has interests in tobacco, food, textiles, ceramics, cement, jute and agro-processing, plans to procure animals from Brazil or Australia and is looking for a suitable site.
Winning Agro's Ahamad estimated that up to $500 million could be invested in cattle farming in the next five years.
Small players up game
But it isn't just the big companies that are entering the fray. Officials say medium-sized farms are springing up in northwestern Sirajganj and Pabna districts, where farmers fatten cows up for Muslim festivals when demand for sacrificial animals pick up.
"The demand for meat is increasing," said Ataur Rahman who owns Ishwardi Cattle in Pabna. He plans to expand his ranch, from 20 cows to 100, if he can secure bank loans.
Meat processors are also moving into cattle farming. One case in point is Bengal Meat. It now has 300 cows as well as contracts with 500 farmers for more supply.
The leather industry is also benefiting from the upsurge in local herds. Leather is Bangladesh's second-largest export earner after textiles and clothing, bringing in $1.34 billion in the last fiscal year, up 6% from the year before.
Even lenders are getting a boost. "The Indian campaign has created an opportunity for us," said Abdul Matin, chief executive of Sojag, a nonprofit microlender based in Savar, near Dhaka. The microlender has provided $7.4 million in livestock loans so far this year. Matin said the figure could reach $8.6 million next year. Sojag also provides training and cattle insurance to the farmers.
With the industry growing rapidly, some are concerned about signs of new beef supplies coming in from India. The Bangladesh Dairy Farmers' Association said in July that a government plan to import frozen beef would be dire for cattle merchants, butchers and small farmers.
Animal trade groups lobbied the authorities to keep out Indian cattle during the recent Eid-al-Adha festival, known as the feast of the sacrifice and celebrated on Sept. 2. Around 4.5 million cattle were sacrificed, or half the figure Bangladeshis slaughter annually. For years, India had supplied a quarter of this demand.
"Our cattle farmers would be decimated unless Border Guard Bangladesh stemmed smuggling," said Alam at the Bangladesh Meat Merchants' Association.
October 21, 2017 6:30 pm JST
Bangladesh cattle herds surge as India curbs smuggling
Apparel makers seize on higher beef prices to set up farms
A.Z.M. ANAS, Contributing writer
Cattle producer Sadeeq Agro won attention when it sold a bull it had imported from Texas for around $20,000 during the Eid al-Adha festival in September. (Photo by A.Z.M. Anas)
DHAKA -- Moves by the Modi government in India to crack down on the country's previously strong beef industry in the name of protecting cows, holy to Hindus, have given new life to the sector in neighboring Bangladesh.
Until recently, the porous border between the two countries was the backdrop to a thriving illegal cattle trade. But India has clamped down on cattle smuggling over the last year, and the number of cows traded across the border has fallen to around 2 million from 3.5 million annually, according to Robiul Alam, secretary general of the trade group Bangladesh Meat Merchants' Association.
This has helped push up beef prices in predominantly Muslim Bangladesh by 18% over the past year, with demand for meat growing with rising incomes. Per capita income topped $1,600 in the fiscal year ended June, doubling from the level five years before. Growing wealth and an expanding economy, which grew 7.2% in the year ended June 30, has created demand for meat. With this enticement, conglomerates previously focused on garment production such as ABA Group and other companies have been pouring substantial money into the livestock sector.
"What is significant is that cattle farmers have got fair prices in the last three years," said A.B.M. Khaleduzzaman, a senior official in the Bangladesh Department of Livestock Services. "This indicates local entrepreneurs are motivated."
Cattle at Sadeeq Agro’s farm near Dhaka (Photo by A.Z.M. Anas)
India's anti-smuggling campaign "has definitely become a blessing for us," said Shah Emran, general-secretary of the Bangladesh Dairy Farmers' Association. "It has created demand for domestic cattle."
Government data show that the number of cattle farms in Bangladesh has swelled to 522,000 from just over 33,000 in 2011. The industry now accounts for nearly a quarter of overall employment.
ABA Group is plowing a further $123 million into a cattle farm at Louhajang, 50km south of Dhaka, where it already has a cattle-fattening facility. It will bring in 2,000 cows from the Netherlands and could invest as much as $200 million in the sector.
"People want to eat quality meat," said Gias Ahamad, chief executive officer of Winning Agro, a Dhaka-based consultancy advising ABA. Winning Agro also owns a one-tenth stake in the project. Ahamad said ABA is seeking foreign investors too. The cattle farm will stretch over 900 acres and will feature technology for tracking cows from birth to slaughter.
Likewise, Eon Group, which already has interests in poultry and animal health, is expanding into cattle. Eon said it would pump $12 million into a farm in the northern Rangpur region, procuring 500 cows from Australia.
Akij Group, one of the largest conglomerates in the country, is also flirting with the idea of investing $6 million in cows. The company, which has interests in tobacco, food, textiles, ceramics, cement, jute and agro-processing, plans to procure animals from Brazil or Australia and is looking for a suitable site.
Winning Agro's Ahamad estimated that up to $500 million could be invested in cattle farming in the next five years.
Small players up game
But it isn't just the big companies that are entering the fray. Officials say medium-sized farms are springing up in northwestern Sirajganj and Pabna districts, where farmers fatten cows up for Muslim festivals when demand for sacrificial animals pick up.
"The demand for meat is increasing," said Ataur Rahman who owns Ishwardi Cattle in Pabna. He plans to expand his ranch, from 20 cows to 100, if he can secure bank loans.
Meat processors are also moving into cattle farming. One case in point is Bengal Meat. It now has 300 cows as well as contracts with 500 farmers for more supply.
The leather industry is also benefiting from the upsurge in local herds. Leather is Bangladesh's second-largest export earner after textiles and clothing, bringing in $1.34 billion in the last fiscal year, up 6% from the year before.
Even lenders are getting a boost. "The Indian campaign has created an opportunity for us," said Abdul Matin, chief executive of Sojag, a nonprofit microlender based in Savar, near Dhaka. The microlender has provided $7.4 million in livestock loans so far this year. Matin said the figure could reach $8.6 million next year. Sojag also provides training and cattle insurance to the farmers.
With the industry growing rapidly, some are concerned about signs of new beef supplies coming in from India. The Bangladesh Dairy Farmers' Association said in July that a government plan to import frozen beef would be dire for cattle merchants, butchers and small farmers.
Animal trade groups lobbied the authorities to keep out Indian cattle during the recent Eid-al-Adha festival, known as the feast of the sacrifice and celebrated on Sept. 2. Around 4.5 million cattle were sacrificed, or half the figure Bangladeshis slaughter annually. For years, India had supplied a quarter of this demand.
"Our cattle farmers would be decimated unless Border Guard Bangladesh stemmed smuggling," said Alam at the Bangladesh Meat Merchants' Association.
