FLOODS, fears of terrorist backlash and a charged political environment have not deterred resilient Pakistanis from celebrating Eid-ul-Azha like they always do. Current market indicators suggest a 10pc expansion in the value of Eid sales.

The size of the Eid-ul-Azha economy was projected at Rs500bn in 2013. If one builds on that number, the current year size should be Rs550bn However, businessmen in the cattle trade believe that cattle (goats, sheep, buffaloes, bulls, camels) worth Rs400bn will be sacrificed all over Pakistan in the three-day-long Muslim festival.

As much as 80pc of the Eid-ul-Azha spending is on sacrificial animals, with the rest consumed by buying clothes, footwear etc.

The spending volumes and patterns during the two Eids celebrated every year differ. The size of the Eid-ul-Azha economy is comparatively smaller. Business at Eid-ul-Fitr, celebrated around two months back, was valued at Rs800bn this year. A comparative study of the spending indicates that the urban sector gets a boost from Eid-ul-Fitr business, but much of the capital flows to the rural sector during Eid-ul-Azha.

“There is a mass movement of cattle from rural areas to urban centres where gigantic ‘mandis’ are set up to facilitate buyers and sellers. Some urban players eying good returns have entered the market, which is dominated by cattle breeders who have been in the business for decades,” said a market watcher. “It is obvious that the net capital flow is from cities to countryside during this Eid.”

The data pouring in from entry points of major cities indicate that the recent floods did not harm the country’s cattle population as much as feared.

“There were apprehensions but the steady arrival of animals has cleared the illusions. It is too early to make projections, but I am expecting brisk activity over the weekend,” commented a trader. About 300,000 goats and 80,000 buffaloes are reported to have arrived in Karachi from upcountry.

“The designated area on Super Highway has been fully occupied and the late comers had to move to small makeshift arrangements in different localities,” a worker at the cattle mandi on Super Highway outside Karachi commented.

While cattle the overall prices have increased, the change is starker in the rate for goats as compared to other animals. The minimum price quoted four days before Eid for a small goat was Rs17,000, and the minimum for cows was Rs45,000.

Kalil Ahmed Khalili — Chairman and CEO of Al Shaheer Corporation, the parent company of retail chain Meatone — was upbeat. He told Dawn over telephone from Makkah that the value of animals sacrificed this year would be Rs350bn. Some others found the estimate to be conservative, and expected total spending to cross Rs400bn.

Commenting on the price trend, he said: “Price stability is witnessed in bulls and buffaloes because of spreading farm culture in that segment. The goat and sheep population is still raised by a large number of small farmers dispersed all over the country. The improvement in quality and quantity is less than the potential”.

Justifying the price hike of 20pc in goats and 10pc in bigger animals, he said the cost of feed and maintenance has increased manifold. “The rise in the price of cattle head is not so much when compared with the hike in the cost of inputs,” said Khalili, who is also a member of the FPCCI sub-committee on Halal meat.

According to an informal survey, one-sixth of about 33m households actively participate in the sacrificial activity. Some 5m families keep a separate budget for Eid-ul-Azha. While the middle class families have a limited budget for Eid and they struggle to make both ends meet, there is a strong presence of discretionary customers with deep pockets in the market who are ready to pay any price for an animal of their choice.

The cattle mandi at Super Highway, Karachi — the biggest in Asia — has about 50 VIP tents where pricy animals are housed. The average price of animals here is Rs200,000. At the higher end, prices go up to Rs1m.

Where a family cannot afford the religious obligation of independently sacrificing an animal, they form a group and split the cost of the sacrificial cattle.

A number of organisations have sprung up who manage the whole business of ‘qurbani’ at a reasonable service charge. This year, the rate for a one-seventh portion in a cow is Rs7,000-8,000, as indicated in advertisements by these outfits.

Some analysts also pointed out to the role of overseas Pakistanis in the Eid economy. “Those who remit billions of dollars must be supporting this massive activity. Their role in Punjab in particular must be defining,” commented an economist.

“The overseas Pakistanis chip in about 30pc of the total spending during the holy festivals,” he added.

Published in Dawn, Economic & Business, October 6th, 2014