Tight egg supply seen as raisers cull chickens


The rising cost of inputs has forced layer raisers to cull birds to prevent further losses, which could cause local egg supplies to tighten ahead of the holiday season.

If the situation worsens, industry players warned of a possible egg shortage in the coming months as small-scale and medium-scale layer raisers would further limit production.

However, a government official said an egg shortage is “an extreme situation.” The official said authorities are now looking at implementing measures that will help producers cope with the spike in production cost.

Two officials of the Philippine Egg Board Association (PEBA) told the BusinessMirror that the layer industry has started culling birds two months ago as they can no longer absorb the rising cost of soybean meal, coconut oil and yellow corn. One official said layer raisers are culling 80-week-old birds, younger than the usual 100 to 110 weeks old.

“Layer raisers started culling two months ago since demand was down and feeds are becoming more expensive,” PEBA President Irwin M. Ambal told the BusinessMirror.

“We are seeing a 40 percent to 50 percent increase in feed costs. From P1,000 per 50-kilogram bag to an average of P1,450 per bag today.”

Ambal said farm-gate prices have remained stable or have registered only slight increases. Raisers are not making money, he said, as farm-gate prices of medium eggs are stuck at P4.50 to P5 apiece.

Peba Chairman Gregorio San F. Diego said yellow corn prices rose to P22 per kilogram from P14 per kg while coconut oil is currently fetching more than P90 per kg from a low of P50 per kg.

San Diego added that soybean meal prices have doubled to P55 per kg due to supply shortfalls in the United States created by lower crop harvests and disruptions caused by port congestion and the lack of vessels.

“If the increase in production costs continue, then everyone will be producing at a loss, forcing layer raisers to cull, therefore, a supply shortage is a possibility,” he said.

Citing historical data, Ambal said the next four to five months would determine if the country will see a shortage of table eggs.

He said a surge in egg prices during the Christmas season would indicate that the raisers have culled a lot of birds in recent months.

“We may not even have enough supply to meet demand during Christmas due to early culling and the decision of raisers to limit production,” he said. “The next four to five months would really determine the replenishment of stocks of the industry. That would be the window time for the industry to react to current market conditions.”

Bureau of Animal Industry (BAI) Director Reildrin G. Morales said the government is aware of the production woes confronting layer raisers and that the government is ready to assist them.

Morales said the government has been in constant talks with US-based soybean and soybean meal suppliers. He disclosed that the arrival of soybeans in the Philippines was delayed by a hurricane which damaged a key US port.

“There are now 4 vessels being loaded with soybean, which may arrive in the country by January and there are three more vessels awaiting loading,” he told reporters.

Morales said the government is also fast-tracking importers’ application to buy soybean meal from other sources like Vietnam, which has a surplus as it imported a lot of the feed material.

“Our layer raisers are trying to sustain production to prevent an increase in egg prices. But if production costs continue to rise, then market forces will come into play,” he said.

“That is why we are continuously working with industry stakeholders and importers to avert this shortage scenario because they will stop raising chicken or implement calibrated depopulation.”

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