Livestock production accounts for about a third of Egypt agricultural output. In the 1970's, increases in the consumption of livestock products outstripped increases in production. Livestock prices rose rapidly, even faster than crop prices, and it was necessary for the country to increase imports sharply. In contrast to crop production, livestock production enjoys substantial economic protection: domestic prices are higher than their international equivalents, and inputs are subsidized. In developing a comprehensive strategy for livestock development, more emphasis should be places en the traditional farm sector, which is the predominant livestock production sector. Small farms specialize more in livestock production than larger farms" and they are relatively efficient in doing so. While traditional sector livestock serve many functions, including providing draft power and manure for crop production, they are primarily milk animals. In this system, red meat is a by-product. Egypt appears to have a comparative advantage in producing milk and poultry meat, but not in producing red meat. There is a variety of opportunities for increasing productivity in milk and poultry as well as in red meat production. Given these improvements, Egypt can expect to become self-sufficient in milk and poultry meats. Expanded production of these two items also makes sense because they are relatively inexpensive sources of protein. Expansion of milk production from traditional herds would have the added benefit of making more inexpensive protein available to the rural poor, where it is critically needed. There are several types of potential improvements in feeding, including the introduction of new green summer forages and the enhancement of crop by-products and wastes. Current feed subsidy policies hinder the development .of new feeds, however, and current feed allocation policies, are irrational in the sense that they serve to distribute disproportionate amounts of feeds to farms which have lower productivity. Farm mechanization is often cited as a means of improving livestock production. Studies show, however, that some 80 percent of livestock work is for transportation which current modes of mechanization seem unlikely to affect greatly. Further mechanization of ploughing should increase milk production. Although Egypt has an appreciable pool of genetically improved milk animals, no workable system has been devised to use this pool to upgrade the traditional farm herd. Artificial insemination has not worked well to date. Furthermore, no viable system has been devised for delivering other veterinary services and medicine's to Egypt's large number of small scale livestock producers. It is necessary that such systems be developed if Egypt is to take full advantage of the vast amount of resources which reside in this sector.