How would you characterize the state of the Kurdistan Region’s food security? What challenges impede increased agricultural production in the Region?
Unfortunately, the state of the Region’s agriculture is weak. The Region only produces 5% of its agricultural goods locally, leaving the Region very dependent on imports. The situation is slightly improved in the poultry industry, where roughly 25% of the Region’s poultry products are grown locally. However, that still means that a large majority of the Region’s chicken is imported.
Cheap, plentiful imports of agricultural products are the primary impediment to the establishment of a productive agricultural sector in the Region.Another major challenge to the local poultry industry is a lack of technical expertise in the Region. The veterinary capacities that are necessary for a healthy poultry industry are difficult to find in the Region’s workforce.
Vano Group is expanding very quickly and successfully. How are you overcoming the problems in the industry?
Vano Group has taken advantage of the opportunities available, and actively addresses the problems associated with the Region’s agriculture. First, our product is of much higher quality than imported options. Our ability to offer fresh chicken, rather than frozen imports, allows us to form corporate partnerships with companies that demand high quality products.
We have addressed the Region’s dearth of technical expertise in several ways. First, we have hired many foreigners to offer their expertise in our quality control department, GP facility, slaughterhouse, and headquarters. Additionally, Vano Group has maintained long-standing partnerships with Aviagen Ross, a UK based poultry supply company, and CEVA Animal Health, a French producer of veterinary vaccines and pharmaceuticals. These partnerships have proven to be immensely beneficial. In addition to employing their expertise and high quality products in our farms and facilities, Vano Group sends local employees to the UK and France for technical training with the companies. Furthermore, Vano Group holds conferences, locally and internationally, in conjunction with Aviagen Ross, CEVA, and other such organizations and institutions. These events increase expertise and improve industry best practices across the Iraqi poultry industry.
Finally, Vano Group’s structure allows for increased independence and improved scalability. We are now completely integrated. Vano Group owns its own steel plant to construct its own facilities. This allows us to construct warehouses, factories, and facilities for other companies in other sectors. Through the poultry production process we are active in every stage, from GP and PS production, through broiler production, slaughter, processing, and distribution. We own our own veterinary labs for biosecurity, disease control, diagnosis, and treatment of our flocks. In many of these stages, we are able to contract with and support other farms in the Region and country. We provide day-old chicks to independent broiler farms, we use our labs to consult with other farms for biosecurity concerns, and we sell CEVA pharmaceuticals around the country.
What are some changes that you foresee in the Region’s poultry industry in the coming years?
Increased local corn and soybean production will lower costs and improve margins in the industry significantly. Soy meal feed is an enormous input cost in poultry production. Imports, which currently come primarily from the US, Brazil, and Argentina, are very expensive. Transportation alone costs us $200 per ton of imported soy meal—and Vano Group imports thousands of tons of soy meal each year. To improve this situation, Vano Group is working with Agrisoya, a recently established Iraqi soybean production company. We offer them office space and use of our facilities for soy storage and processing.
More generally, I am optimistic regarding the share of poultry that the Region will produce locally. As I mentioned, Vano Group is in touch with many of the local farms and companies in the industry, and there seems to be impressive expansion in the industry. I am hopeful that local production will continue to erode the dominance of imported chicken’s market share in the Region.