The Bounty Fresh Group, one of the country’s leading poultry producers, is ramping up integration with expansion from plants, farms, cold storage, systems, restaurants, among others, as the Philippine poultry industry is growing at four percent—faster than the global rate of 2.5 percent—driven by strong domestic consumption and adopting sustainable production practices.
This was highlighted by Atty. Kenneth G. Cheng, President and CEO of Bounty Fresh Group Holdings, Inc., the country’s second-largest poultry producer, during a press briefing on Monday, October 13, on “Bounty’s Blueprint for a Resilient Industry.”
Investing for the Future
According to Cheng, the industry continues to invest to meet growing demand and ensure an ample supply for the future. “We are investing for the future,” he stated.
In the case of Bounty Fresh, Cheng said their investments go beyond just new farms; they include new plants and all aspects of an integrated poultry supply chain. “It’s an integration because you cannot add birds without feed mills, hatcheries, and farms—so all are connected. Now, we are investing for the future because the Philippines is growing, and we want to be part of it,” he explained.
Bounty Fresh is also investing in cold storage, new restaurants, and system upgrades. Previously, 80 percent of its overall capital expenditure went toward poultry, but that has now decreased to 50 percent.
Cheng added that they plan to open a total of 300 Chooks to Go stores this year, with existing stores from all regions improving their performance. “By the end of the year, we’ll probably reach around 2,000 stores,” he said.
Industry contributions
Dr. Vicente Manolo Jr., Senior Vice President and Head of Marketing for the group, noted that Bounty Fresh accounts for approximately 25-28 percent of the country’s total poultry production—about 1.6 billion kilos—based on estimates by the Bureau of Animal Industry. This is on top of an estimated 2 billion kilos of imported poultry meat, which roughly contributes 20-25 percent of the total supply. The share of imported poultry meat has been increasing from only 10-15 percent in the past.
Manolo further explained that 30 percent of Bounty Fresh’s poultry supply comes from its internal production, with the remainder from contract growers. “We encourage businessmen to engage in contract growing,” he said. The minimum investment for one poultry house is estimated at PHP25 million, but Manolo affirmed that the returns are very good.
Bounty Fresh is also expanding its internal production nationwide. In the Visayas alone, it operates in six provinces—including Calbayog, Tacloban, Cebu, Iloilo, and Dumaguete—while plants in Luzon account for 60 percent of production due to high consumption in the country’s largest island.
“We are one of the fastest-growing chicken-consuming countries. It used to be pork, but because of the ASF (African Swine Fever), chicken is now number one in the country,” Manolo said.
Cheng added that all its local production is solely for domestic consumption. However, the company imports poultry from its wholly-owned plant, Tegel, in New Zealand. Tegel also exports to Australia, the Middle East, Hong Kong, Japan, Singapore, and several Pacific Islands, including Papua New Guinea. Bounty has also initiated operations in Indonesia under the brand SEGAR.
Developing market
Cheng also denied reports that Bounty Fresh plans to go public. They are not even considering acquiring a local operation to grow. “That’s the good thing about having a business in a developing country—you don’t need to buy out someone to expand because you’re still growing,” he explained.
Unlike in mature markets like the U.S., where growth often depends on acquisitions, Cheng said, “In a developing country, you just grow with the industry.” They also invest in other countries to export products back to the Philippines.
“We’re already breathless in the Philippines. It’s really a wonderful market, and the players are very mature,” he added.
The Bounty Fresh group is the second-largest poultry company in the country, just behind San Miguel Corp.
