Increasing power cuts have taken a toll on poultry and egg prices which have surged by more than 25 per cent due to a significant rise in mortality rates of the birds.
Tharwat Al-Zeini, vice president of the Poultry Producers Union, said on TV recently that farms across the Delta and Upper Egypt are grappling with severe crises exacerbated by unprecedented spikes in temperatures, noting that the majority of the farms are small to medium-sized operations, making it financially unfeasible for them to invest in generators.
Even those who possess generators often contend with outdated and ineffective equipment, Al-Zeini said.
“While reducing electricity loads may save hard currency, it is imperative to consider the broader impact on sectors like agriculture and animal production,” he added.
Egypt’s poultry production has been facing challenges since 2023, including soaring feed and vaccination costs compounded by a shortage of these supplies in the local market due to currency fluctuations. The crisis led to the closure of numerous small poultry producers due to inflated costs and raw material shortages.
However, Tarek Suleiman, head of the Livestock and Poultry Development Sector at the Ministry of Agriculture, said that Egypt’s poultry sector had overcome the crisis of the previous year.
Since September 2023, local production has been meeting demand, with a surplus exceeding domestic requirements — even in peak-demand seasons — due to the ministry’s electronic databases and field monitoring meant to ensure optimal utilisation of poultry facilities. The data reveals peak occupancy rates in poultry houses and farms, whether for broiler chicken or table egg production, Suleiman added.
The state’s efforts to secure feed raw materials like corn, soy, and feed additives have paid off, leading to a decline in the cost of raw materials and feed by up to 40 per cent. The state has also prioritised the clearance of feed imports through Egyptian ports, he noted.
Egypt’s dispensing of poultry imports is proof of the domestic sector’s stability, Suleiman stated. The stability is evident in the balance between supply and demand, he added, affirming that the ministry seeks to support producers and breeders towards this end.
Egypt has accredited isolated poultry facilities, complying with the standards set by the World Organisation for Animal Health, Suleiman said. This has enabled Egypt to surpass domestic needs and resume exports after a hiatus of over 15 years. Egypt’s advanced poultry industry, coupled with its strategic geographical location, positions it favourably to export its poultry surplus.
Suleiman anticipates a surge in demand for poultry and fish during the summer months, as is the case every year, because families tend to favour poultry and fish especially during summer vacations. He stressed that the country is well prepared to cover the high demand.
Abdel-Aziz Al-Sayed, head of the Poultry Division at the Chamber of Commerce, rejects claims suggesting a 20 per cent shortfall in poultry production due to power outages, asserting that large farms are adequately equipped with contingency plans, including electricity generators and efficient operational mechanisms.
While the cost of running generators for an hour or two a day does not significantly impact production costs for these farms, smaller operations may experience minor disruptions not exceeding five per cent, Al-Sayed said, cautioning against exaggerating the impact of power outages which may end up being a false justification for price hikes.
The availability of feed and foreign exchange following a shortage period should have decreased poultry and egg prices. Following the end of the crisis, feed was imported for approximately LE20,000 per ton.
Abdel-Aziz attributes the current stability of prices in the poultry sector to the balance between supply and demand despite not returning to the maximum production levels of 2022.
In 2022, Egypt produced 1.5 billion chickens and 14 million eggs, up from the current annual production of 900 million chickens and 8.5 million eggs, he noted.
Despite the decreasing production, supply is meeting demand due to the declining purchasing power and the major producers’ control over the market by adjusting supply to barely meet demand, Abdel-Aziz said, thereby preserving current price ranges.
He stated that state intervention in market control is not entirely unacceptable but should be timed appropriately. An example of such intervention was seen in the fasting month of Ramadan when the Ministry of Agriculture offered table eggs at a reduced price of LE140, compared to the market rate of LE180. The intervention aimed to benefit both citizens and producers, stabilising the market while thwarting any attempts to manipulate prices.
* A version of this article appears in print in the 13 June, 2024 edition of Al-Ahram Weekly
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