Will 10 crore eggs make any difference?
The decision to allow egg imports was prompted by traders who disregarded the government's fixed pricing guidelines
The green light for importing 10 crore eggs sounds to be good news. The number, good for two and a half days of demand in the country, however, may not truly cool the still uncontrollable price of eggs.
The commerce ministry granted import rights for four crore eggs to four companies on 17 September, and yesterday, six additional companies were given permission to import six crore eggs.
The decision to allow egg imports was prompted by traders who disregarded the government's fixed pricing guidelines.
Despite the government's set retail price of Tk12 per egg, eggs continue to be sold in Dhaka at Tk12.50 or even higher.
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The affordable protein is a great alternative to fish and meat, two very high-priced protein sources and sellers have been doing brisk business with their counters piled high with eggs as low budget families increasingly chose eggs for breakfast or lunch. Until, that is, when egg prices saw a steep rise to go out of reach for most.
Industry insiders say this higher demand amid a 25% fall in production compared to the pre-Covid level has pushed the prices up.
While they currently see no problem with importing eggs, they are concerned with the long term consequences if imports continue to supply the market. They want to address and resolve the challenges faced by poultry farmers.
Md Mahabubur Rahman, secretary of the Breeders Association of Bangladesh, welcomed the decision to permit egg imports, viewing it as an opportunity for local producers to rectify any shortcomings they might have.
"However," he emphasised, "meticulous planning is needed to make the sector stable. Do we have an accurate assessment of the actual demand and current production levels?"
In line with this, Mahbubur Rahman stressed the importance of government intervention in strategising the production of eggs to specific districts or upazilas based on their respective needs. He asserted.
Poultry farmers are also concerned with the rising costs of poultry feed. They are urging the government to consider regulating feed prices similar to what has been done for eggs.
Will imports help stabilise market?
Local poultry farmers report that due to farms failing, domestic egg production has dropped to approximately 3.75 crore pieces per day, falling 25 lakh short of demand.
Therefore, if 25-30 lakh imported eggs enter Bangladesh daily, the phased import of 10 crore eggs is expected to support the market for over a month and help normalise prices by addressing the deficit, they added.
The four companies, initially permitted to import one crore eggs each, plan to source their eggs primarily from India for faster shipments.
They plan to make these eggs available by the coming week.
Saifur Rahman, proprietor of one of the four business entities, Tiger Trading Ltd, explains, "We expect to sell each egg in the local market for approximately Tk9-10 after importing from India. Our calculations estimate the cost of importing each egg to range from Tk5.9 to Tk7.2."
AHM Safiquzzaman, director general of the Consumer Rights Protection Directorate, states, "Indian eggs are smaller in size, which is noticeable upon inspection. Therefore, selling them at a higher price to consumers may not be easy. We will also monitor the situation."
He expressed hope that imports will help stabilise the egg market.
What led to the price hike?
Poultry producers cited challenges such as losses during the Covid pandemic, increased feed prices due to the Ukrainian war, and rising electricity tariffs, which have placed significant pressure on the poultry industry. Many farmers have stopped production facing losses, they added.
According to the Bangladesh Poultry Industries Association, out of 1,58,017 farms in the country, 95,523 are currently in production.
March data from the association indicate that farm closures have reduced daily egg production capacity in the country from 6.64 crore to 4.32 crore.
The Bangladesh Poultry Industry Central Council (BPICC) reports that egg production fell to 3.75 crore pieces in August, while its demand increased due to a rise in prices of fish and vegetables.
As a result, egg prices began to rise from the end of July, reaching up to Tk15 per egg in August.
However, in the wake of market monitoring by the National Consumer Rights Protection Directorate and the revelation of production cost by the livestock ministry, the price of each egg has come down gradually and is selling at Tk12.5.
Potential impact of egg import on poultry sector
Poultry meat and egg producers said that imports of eggs will have a significant impact on the sector, because there are many small, medium, and large farms here.
Through this, which one between import and production is appropriate will become clear and then the government can decide what to prioritise, they argued.
Sector insiders said that the cost of egg production is Tk10.80 at the local level and Tk10.50 at the corporate level. So, if eggs are sold at just Tk10, both segments of producers will lose.
Therefore, the demand of the producers was that if each egg were sold at Tk12.50 at the retail level, it would be fair for the consumers and producers.
Calls to regulate feed prices too
Egg producers said the price of poultry feed is a problem. Maize and soybean meal are the two most important components of poultry feed, they noted, suggesting that either alternatives need to be developed, like India, or the government needs to take steps to keep the prices of these two lower.
Recently, at an event, the president of the Bangladesh Poultry Industry Central Council (BPICC), Shamsul Arefin Khaled, said that due to the increase in the prices of fish, meat, and vegetables, there is an increased demand for eggs, but many farmers have moved away from egg production owing to ongoing losses. Therefore, it is essential to determine the actual demand and create production plans accordingly, he added.
He also recommended that the government allow the import of some alternative feed components from India at zero duty to reduce feed prices.
The price of broiler feed has increased by 51% and layer feed (used in egg production) has increased by 58.97% during February-March 2023 compared to 2020, leading to an average production cost rise of 120%-130%.
Farmers also claimed that just as the price of eggs is determined from the production level up to the consumer level, fixing feed prices in the same way will have a positive impact on egg production.
Dr Nathuram Sarkar, former director general of the Bangladesh Livestock Research Institute (BLRI), stated that poultry production worldwide has dropped by 6% and this has also affected Bangladesh.
"Just like the rest of the world, there has been a significant drop in production among small and medium-sized farmers in our country," he said.
He went on to say, "The most crucial factor in livestock production cost is feed. India is self-reliant in this regard, they can produce it at a lower cost. However, we only produce 60% of the required maize locally, and the rest of the ingredients need to be imported."
He stressed the need for comprehensive planning for the large poultry industry.
