What causes eggs to be 50 percent more expensive?

According to Tejarat News, according to the instructions of the National Program for Quality Improvement, Health and Assurance of Egg Health, from the first of February, the supply of eggs will be only in the form of packaging. This program is first implemented on a trial basis in Tehran province. Producers say the most important achievement of the program is the elimination of speculators from the egg market.
Chicken and egg prices have been rising since a month ago. The increase in the price of livestock inputs, despite the allocation of 4,200 Tomans to supply inputs, and as a result of the decrease in production in October and November, were the two main reasons for the increase in the price of these two high-demand goods. But with the increase in hatchery, poultry and egg production are expected to return to normal and prices to stabilize.

Several programs for egg supply

By setting the price of each kilo of eggs equal to 14 thousand and 500 tomans for the consumer, by the market regulation headquarters, but this price is observed only in the fields of direct supply of goods and the price of eggs in retail stores is higher than the set price. This has led to the multiplication of egg prices and increased profitability of traders in this market.

With the increase of brokers in the egg distribution network, the deputy director of the Livestock Support Company has decided to change the way eggs are distributed in order to eliminate the brokers’ network in the market. Accordingly, from now on, those who buy eggs from poultry doors must have the approval of the Livestock Support Company at the time of purchase. Also, docks in the provinces have been provided to egg production organizations, from which they will meet the market needs directly and at an approved price.

In other programs, any export of eggs has been banned and the production of this product in the country is more than one million tons. Experts attribute the sale of eggs at prices higher than the approved rate to violations in the distribution network. The purpose of this plan is to eliminate the brokerage network. Speaking to Iran about the new program of the Livestock Support Company for the supply of eggs, Seyed Farzad Talakesh, the secretary of the country’s registered egg union, said: “Experience has shown that the implementation of such programs does not meet its goals.”

We currently have 2 models of egg distribution in the country. It is a type of bulk distribution that accounts for approximately 80% of egg sales through the poultry farm. In this method, the major buyers receive the eggs safely from the producer, and the egg is rotated by almost two hands to reach the shop. Egg production is 3,200 tons per day, of which 2,500 tons are distributed in this way. Alternatively, 20 percent of the eggs are sold to packing factories and 20 percent to food factories.

Talakesh added that the Livestock Affairs Support Company has announced that it will provide docks to the provincial cooperative unions so that qualified individuals and wholesalers with egg licenses can buy them for distribution from these docks. But we only have up to 4 licensed wholesalers in the country to sell eggs. Of course, many people have specific identities for buying and selling eggs through associations, but we do not have a licensed wholesaler in this sector. Therefore, nearly 100% of the egg distribution is traditional. Unless the Ministry of Jihad for Agriculture signs a memorandum of understanding with the Egg Wholesalers Association and the association introduces people to buy bulk eggs from the producers, which is limited and difficult to control and monitor its implementation. But the second solution is to cut off the supply of bulk eggs and sell them in packages.

According to the secretary of the country’s registered egg association, the only product that does not have a price on the product in retail stores is the open egg, which makes the supply of eggs in a packaged price controllable and negotiable. We have an agreement that allows the supply of eggs only in the form of packaging. The agreement was signed by the Ministry of Health and the Veterinary Organization last year. According to the instructions of the National Program for Quality Improvement, Health and Assurance of Egg Health, from February 1, the supply of eggs will be only in the form of packaging. This program will first be implemented on a trial basis in Tehran province, and in this province, unpackaged eggs will no longer be offered in shops in this province from February.

The price of packing eggs

But there are concerns that the supply of packaged eggs could push up prices again. Now, eggs in the direct supply market of fruits and vegetables are sold for 14 thousand and 500 tomans per kilo, which means that each 30-ounce egg is priced at about 29 thousand tomans. But a 20-digit pack of eggs is priced at around 38,000 tomans, and this price is slightly higher or lower in retail stores, according to the packing company that supplies the eggs.

The secretary of the country’s registered egg association, in response to concerns about the increase in the price of eggs with the supply of packaging, said: The price of packaging eggs is determined based on its quality as excellent or ordinary or the same grade one and two. Premium eggs have a higher price in terms of weight, freshness, uniformity of eggs in the packaging. But a typical egg may weigh less and its yolk is not saffron. Of course, this does not mean that the quality of this type of egg is low. According to the decisions, the supply of 30 packaged eggs will be 33 thousand Tomans from the first of Bahman, meaning that the price difference between the 30-shoulder eggs that are now offered in the markets is about 3 thousand Tomans. The average per capita consumption of eggs in the country is 216 per year, and this consumption is about 330 in the lower three deciles. According to the calculations made, one to three deciles may consume 2 to 3 eggs per month, so the increase in the price of packaged eggs compared to bulk for this decile is about 3 thousand tomans per comb.

Of course, the secretaries of the country’s certified eggs union emphasized that the price of packaged eggs is high due to packing costs and the reason is less use of capacity in packing factories, but if the supply of eggs is only packaged, the production capacity of these factories will be reduced. Packaging will be effective. He stressed that selling eggs from producers to packing factories would cut traders out of the egg market.

He added: although the market regulation headquarters has set the selling price of each kilo of eggs at the poultry farm door at 12,000 Tomans, but in practice the sale price through the poultry farm door is higher than the figure set by the market regulation headquarters. Poultry farmers announce the production cost of more than 12 thousand tomans per kilo of eggs.

Yesterday, the market regulation headquarters was scheduled to meet with the producers and producers of eggs to review the producers’ claims regarding the costs of egg production, and if this claim is confirmed, the new egg prices will be announced by the headquarters. But at the time of writing, no official announcement had been made about the price of eggs.

Another plan to reduce the price of eggs is to ban its export. However, according to the secretaries of the country’s registered egg association, although export is prohibited, there is an incentive to export due to the exchange rate, and 30 to 40 tons of eggs per day are exported illegally from the country.

Increased hatching

As for the chicken market, with the increase of hatchery to 108 to 110 million per month, there is an expectation to reduce and stabilize the price of chicken. Mohammad Ali Kamali Sarvestani, CEO of the Broiler Poultry Farmers’ Union, said: “Due to the reduction of hatchery in October and November, production had decreased. On the other hand, due to lack of inputs, less produced chickens were introduced to the market and these two factors increased prices.” But as the corona continues, demand for chicken in the market will not increase. On the other hand, with the increase in hatchery, we expect the price of chicken to remain stable and stable as before. At present, in the bases of direct supply of goods, chicken is sold for 20 thousand and 400 Tomans per kilo, but in chicken retail stores, it is sold at several prices and at prices of 30 to 34 thousand Tomans per kilo. The increase in the price of chicken has led to long queues in the squares to receive chicken at a lower price, but with the increase in supply in recent days, the queues have become shorter and it is expected that the chicken will be sold at a fixed price as before.

Source: Iran