Egg producers crack under soaring prices | Main stories
DARK CLOUDS are hovering over the businesses of egg farmers in Jamaica. And given the huge and continuing spike in the costs of production inputs like animal feed, it has been predicted that small-scale interests of 1,000 people or less could collapse.
Large players with over 5,000 layers are also at serious risk, according to industry insiders.
Mark Campbell, a large-scale egg producer who has been in the business for 41 years, revealed in a Gleaner interview that inflation and coronavirus-related market pressures have cast a shadow over the industry.
“COVID-19 has had a negative effect on us. Despite that, it’s the worst I’ve experienced since Hurricane Gilbert,” he said, referring to the monstrous 1988 storm that hit Jamaica’s agricultural sector and destroyed many buildings.
“When COVID hit the industry, many farmers had to sell their birds as boiling hens. The egg market has stagnated. Now that there is an improvement, farmers are struggling to replenish their stock,” Campbell added.
The seasoned chicken farmer revealed that the value of laying hens has risen to $1,395 for 199 or less, when it costs $1,295 for 200 or more. The price of animal feed has more than doubled in three months, rising from 60,000 dollars per ton to 96,000 dollars.
Campbell insists that many small investors simply cannot absorb the rising cost of production.
His concerns were echoed by Doreen Hibbert, director of the Jamaica Egg Farmers Association, who warned that current conditions could wipe out many producers.
Citing a 28% rise in feed costs since January, Hibbert warned the risk was that small farmers would be left behind, causing a supply shortage.
“For starters, the increase in the price of feed is going to kill the small farmer as an entrepreneur. Every month there is an increase in the price of feed,” said Hibbert The Gleaner.
Melrose Cummings, a small egg farmer, said the rapid price increases had become unbearable.
Cummings said spiraling price increases force him to set break-even costs of $1,000 per egg dish. A dish constitutes 30 eggs. But that price, she says, is unaffordable for the average consumer.
“I often have to buy sawdust. It has increased. I deliver to my customers. Once to deliver, I would buy $5,000 worth of gasoline. Now, to cover the same trip, it’s $8,000. Only God can help,” she exclaimed, raising her hands in the air.
Hibbert predicted that a “tightening” of supply could trigger the need for imports to fill the gap – but that intervention, she said, might not be feasible.
“It would be disastrous. Towards the end of 2021, bringing in a 40ft container would cost US$5,000. Now that same container costs US$18,000. This does not include the cost of insurance and transport. I don’t even want to think about it,” Hibbert exclaimed.
Jamaica Agricultural Society (JAS) President Lenworth Fulton argued that an industry-wide policy review is needed.
Eggs are among the cheapest forms of protein but are increasingly out of reach, said Fulton, of “Little Man”.
“When you look at animal feed production, almost all of the ingredients are imported. Look how much unused land the government has. Why is there no policy to encourage the planting of maize, a key ingredient in the production of animal feed? wondered the president of the JAS.
Fulton called for greater local investment in research and development.
Citing the two main production methods – caging and deep bedding – Hibbert urged authorities to explore cheaper inputs to reduce operational expenses for farmers.
The cages, he said, are more efficient and cheaper, but those costs have also increased because they come from China. It is constantly increasing. They try to absorb some of the costs.
“Other things influence the farmer. Eighteen months is the life of a laying bird. If they stay longer, they lay eggs less frequently, but they continue to eat and produce less,” Hibbert said.
“Eggs for layers are imported and fertilized. If there is a shortage of fertilized eggs, the layers will be short, hence a shortage of eggs. A policy to deal with our situation must be developed,” Hibbert said.