The average Producer Price Index for industrial chicken farms in the fourth quarter of the last Iranian year (Dec. 22, 2019-March 19) decreased by 7% compared with the corresponding quarter of the year before.
The overall PPI for the sector in winter, which ended on March 19, using 2011 as the base year, stood at 498.66, indicating a 7.16% decline compared with the preceding quarter.
During the four-quarter period ending March 19, PPI increased by 19.36% compared with the similar period of the year before. The index grew 42.23% in the four-quarter period ending Dec. 21, 2019.
The highest quarter-on-quarter increase of the index among Iranian provinces during the period under review was registered for Chaharmahal-Bakhtiari Province with 57.83% and the sharpest producer deflation was recorded in Gilan with 48.49%.
On a year-on-year basis, Chaharmahal-Bakhtiari Province also registered the highest increase with 96.37% and Gilan posted the biggest deflation with 43.24%, the Statistical Center of Iran reported.
PPI is a price index that measures average changes in prices received by domestic producers for their output. Its importance is being undermined by the steady decline in manufactured goods as a share of spending.
Poultry farmers have been grappling with a production surplus amid a decrease in demand for chicken following the outbreak of the new coronavirus.
“Chicken farmers have suffered more than 21 trillion rials [$127 million] in losses during the past five months due to the surplus production,” said Boroumand Chahar-Aeen, the head of Iran Broiler Breeders Union’s board of directors, recently.
He expects the current trend to continue, considering the ongoing circumstances, saying the losses are bound to pile up further.
According to the official, the decline in purchasing power is also one of the reasons behind the surplus production, Young Journalists Club reported.
According to Mehdi Yousefkhani, the head of Tehran’s Union of Fowl and Fish Sellers, there has been a 50% decline in chicken consumption in Iran following the outbreak of the new coronavirus.
“There is usually a chicken production surplus of at least 30,000 tons per month,” he added.
Iran produces 2.4 million tons of chicken per year, he said, adding that production capacity stand at over 3 million tons.
Duties on chicken exports have been abolished until May 21. The removal of export tariffs is aimed at helping producers cushion their losses by selling at least a part of their surplus production abroad.
The severe shortage of animal feed, including soybean and cornmeal, poses a challenge for poultry farmers, due to which millions of day-old chickens were culled recently, raising much debate and criticism.
Following the release of a footage on social media showing the poultry destruction, the Day-Old Chicken Producers Association wrote a letter to its members banning the cull of day-old chickens, saying any violations will be prosecuted.
Akbar Golshahi, an official with Iran Veterinary Organization, told Fars News Agency that 1.2 billion day-old chickens are produced in Iran per year.
