Targeting The Champions League

At the end of the 1990s, companies from the white meat sector began to appear in the Istanbul Chamber of Industry (İSO) and Capital 500 surveys. The fact that nine companies featured in the 2004 survey show that their rise has continued. The sector currently has a total turnover of $2 billion and a production capacity of 1.2 million units. Export levels are very low. But the granting of the permits required for the EU would produce an explosion in exports and make it possible for Turkey to rise from the position of 18th worldwide which it currently holds.

When one looks at the Istanbul Chamber of Industry (İSO) list of the 500 Largest Industrial Companies in Turkey for 1978, one cannot see any companies from the white meat sector. It is the same in the survey for 1980. It was only in the 1990s that white meat companies began to enter the ‘major league’ in Turkey. In 1992 Banvit entered the list at number 398. In the İSO 500 published for 1995, Banvit rose to 254th and there were other entries. For example, Mudurnu was ranked 170th.

At the end of the 1990s white meat producers had begun to increase their influence in the major league. In 1999, when the Capital 500 was first published, it included Köytur, Banvit, Mudurnu, Beypiliç, Özhen, Entaş, Şen Piliç and Keskinkılıç. In this way, for the first time, eight companies succeeded in becoming members of the Capital 500 Club at the same time. There were nine companies in the survey which was published in 2004. What is more, one of these, Banvit, had succeeded in establishing itself in 104th place. While Beypi and Erpiliç had risen to the top 200.

This picture demonstrates the birth of a sector in Turkey. Annual per capita consumption of what had been classed as ‘guest food’ in the 1970s had risen from 1.5-2 kilos to over 13 kilos. The rise in consumption was reflected in the figures for production. A major increase in production has been recorded in the last 10 years. According to data from the White Meat Industrialists’ and Breeders’ Association (Besd-Bir), total production of poultry meat rose from 311,000 tons in 1994 to 983,000 tons last year. In recent years there has also been an increase in the number of brands and integrated plants. Today there are around 12 integrated plants in operation. The leading five companies in the sector are C. P. Standart, Banvit, Beypiliç, Erpiliç and Şenpiliç. In fact, there are no great differences between the market shares of the leading 10 companies, who together account for 70-80 percent of a total market worth $2 billion. The sector has a total production capacity of 1.2 million. Even if some of them have experienced difficulties in recent years, and the sector has suffered from fluctuations in macro-economy, the companies which have been responsible for raising the white meat sector to this level continue to grow in strength.

The two largest players in the sector

C. P. Standart is one of the leading members of the white meat sector and the only company in the field with foreign capital. It is the Turkish affiliate of the C. P. Group, which is the largest feed producer in the world and is active in 19 countries worldwide. C. P. Standart began its activities in Turkey by establishing a feed factory in İnegöl in 1986 and today it has the largest market share.

C. P. Standart Board Chairman Nezih Gençer says: “We need to ensure an increase in consumption. This is how the sector has grown until today. The low level of per capita consumption is one of our main problems.” Last year the company produced 105,000 tons of chicken, giving it a market share of approximately 12 percent. This year it is targeting production of 112,000 tons. The company is the leader in the feed sector. Its annual production of 590,000 tons of feed gives it a market share of 10 percent. It production target for 2005 is 630,000 tons.

Banvit, which is the second largest company in the sector, began operations in 1968 as a feed manufacturer. In 1985 it moved over to producing white meat. Today it has a slaughtering capacity of 16,000 chickens per hour, or 75 million per year, which gives it the largest poultry slaughtering capacity under a single roof.

In 1996 it realized a number of investments in line with its goal of becoming the leader in Europe. Following the establishment of Banvit Romania, its advanced processing plant in Bandırma for the production of ready-to-eat food began operations.

On the other hand, it also began the production of turkey meat through the acquisition of the Tadpi plants in Armutlu. A short time later it bought a feed factory, again in Armutlu, which, after modernization, began production. In addition, it began work to establish an integrated plant to produce poultry in Romania. The company employs 4,000 personnel.

Beypi’s target for 2010.

Beypi is the third largest company in the sector. It was founded in 1986. It produces under the Beypiliç brand. The company is publicly owned and has 212 shareholders. It employs 1,700 personnel. Last year the company was merged with its founding partner Beyyem A. Ş. and it will rise in the sectoral rankings as a result. The company made investments worth YTL 7 million in 2004 and it is currently continuing with the realization of an investment with an incentive certificate for $100 million. The goal is to increase the production of white meat to 200,000 tons by 2010. It also plans a parallel increase in its exports of chicken, which in 2004 stood at two million kilograms.

Three major players from Anatolia

Erpiliç began production in the 1970s in Göynuk in Bolu using traditional methods. Today, with its integrated plant it is one of the five largest poultry producers in Turkey. It ranked third in 2004, as it had in 2003, with a production capacity of 74,500 tons. It has a market share of approximately 9 percent. When its main plant in Bolu begins production in 2005 it will have a production capacity of 110,000 tons of meat. In this way it will increase its turnover from YTL 183 million in 2004 to YTL 210 million in 2005.

Şenpiliç is the fifth largest company in the sector. Şenpiliç began production in 1978 with a breeding facility and currently conducts operations through an integrated plant in Sakarya.  The company’s general manager İpek Üstündağ says that if they do not receive incentives then they will have problems competing.

Pakpiliç is one of the oldest players in the market. The company was founded in 1955 and has been producing steadily for the last 50 years. It is a fully integrated company with a breeding facility, incubator, feed factory, and slaughterhouse. In terms of capacity, Pakpiliç is the sixth largest company in Turkey and last year had a turnover of YTL 133 million. Its output stood at 64,000 tons.

AN ANALYSIS OF COMPETITION IN THE TURKISH WHITE MEAT SECTOR

WE RANK 18TH WORLDWIDE In the last ten years the global production of poultry meat has increased by 50 percent. In 2003 it reached 65 million tons. The largest producer is the USA with 15 million tons. It is followed by China with 9.5 million tons. Brazil ranks third with 7.7 million tons. In terms of poultry meat production Turkey ranks 18th worldwide.

HOPES REST ON EXPORTS TO THE EU The nearest export target market is the EU. When the sector’s standards have been certified as sufficient, then exports will start to the EU. There have been some positive developments in this regard. The Ministry of Agriculture and Rural Affairs and the sector have reviewed all of the amendments published by the EU. New amendments have been made related to institutions which will export to the EU taking into account the legal amendments in Turkey,.

Production in Turkey has neared one million tons

Tons

1994  311,347

1997  616,589

2000  752,382

2002  705,206

2004  983,000

Source: Besd-Bir

YASEMİN BALABAN
ybalaban@capital.com.tr