The chicken and eggs on which many people depend for protein in their diets have been witnessing spiralling increases in prices, with one kg of chicken now hovering around LE100 and an egg at LE4, almost twice the price six months ago.

The problem started with problems in the supply of feed resulting from backlogged supplies stranded in the ports. This led to a drop in supply to the poultry market and the exit of some producers. The appreciation of the dollar against the Egyptian pound since March 2022 to over LE30 to the dollar also added to the pressure.

But these are not the only reasons why the poultry market has been seeing this rate of inflation, said Abdel-Aziz Al-Sayed, head of the Poultry Division at the Chamber of Commerce. The price of a ton of the corn used in poultry feed costs LE10,000 at the ports and LE16,800 on the open market, he said, adding that the prices would likely remain high for another six or eight months.

Al-Sayed said that the prices of all production inputs in the industry are “exaggerated”, adding that the Ministry of Supply should play a monitoring role. The government should have announced the news of the release of the feed from the ports in the Official Gazette and tracked it from the ports to consumers, he said.

Meanwhile, prices in Egypt have been rising across the board, with the annual inflation rate jumping to its highest level in five years in January to reach 26.5 per cent compared to eight per cent in the same month of 2022.

During January, the prices of basic commodities rose steadily. The cost of bread and cereal increased on average by 6.6 per cent, while the price of meat and poultry climbed by 20.6 per cent.

Al-Sayed said that prices were being manipulated by producers, leading some to argue that they should be boycotted. The government should intervene to set the costs of production and profit margins, he said, blaming major producers with large shares in the market and not small-scale producers for the problem.

The shortage in feed had created a gap in the market, leading to the exit of some producers coupled with a sharp drop of 50 per cent in the supply of chicken to the market. The General Authority for Supply Commodities imports feed, and it should be sold for LE10,000 per ton, he said, adding that the prices would eventually drop.

The price of chicken to the consumer will also fall if inputs drop in price, as these make up 70 per cent of the overall cost, Al-Sayed said, adding that a fair retail price for a kg of chicken was LE65.

President Abdel-Fattah Al-Sisi met with Prime Minister Mustafa Madbouli and a number of ministers on Sunday to follow up on developments in strategic agricultural crops, livestock projects, and efforts to increase Egypt’s production of meat and dairy products.

Al-Sisi ordered support to be given to the agricultural sector and farmers and the contract-farming system to be expanded to the cultivation of strategic crops. He asked the government to announce the supply prices of corn, soybeans, and sunflowers to encourage farmers to increase the production of these crops, especially those used for fodder, as a way of reducing imports and regulating prices.

Meanwhile, the government has announced it is increasing frozen chicken imports to provide it at affordable prices, especially with the expected increase in demand during the holy month of Ramadan. Egypt used to import 50,000 tons of frozen poultry annually, a small figure compared to a monthly consumption of 180,000 tons.

Al-Sayed believes that the decision to increase chicken imports will put the brakes on prices in the local market, although it may harm the national industry. He advised supervision of the prices of soybeans and other production inputs to prevent producers from selling chicken at inflated prices.

While it was unlikely that poultry prices would return to last year’s prices, owing to the depreciation of the value of the pound, there was no reason why chicken prices should be so high, he said.

* A version of this article appears in print in the 23 February, 2023 edition of Al-Ahram Weekly