Economy, Domestic Economy

The Cracks in Egg Industry

The Cracks in Egg IndustryThe Cracks in Egg Industry

The egg production sector needs proper management to curb price fluctuations that severely damage the industry, secretary of the Egg Producers Union said.

“In the Iranian year of 1393 (March 2014-15), in collaboration with the Ministry of Agricultural Jihad, we made plans to adjust production in proportion to domestic demand,” Farzad Talakesh was quoted as saying by the Persian daily Forsat-e Emrooz.

“Until then, the ministry had set the target of annually increasing the hatchings by 6%, without taking into account a market for the surplus production. The industry was hit hard as a result.”

According to the official, the new plan enables the country to export 90,000 tons of eggs every year, but if the distribution system is not modernized, problems will persist.

“Production has been modernized, yet we are lagging behind in the distribution sector, which still operates traditionally. We have not been successful in creating brands either,” he said.

Talakesh noted that producing certified eggs seems a good solution to the problems facing the egg industry.

“Chain stores and hypermarkets have helped us greatly in selling certified and branded eggs, since they are interested in signing contracts with companies that are accountable for their product quality. Moreover, they balk at unreasonable price fluctuations of wholesale eggs. Over the past seven years, the price of certified eggs has changed only three times,” he said.

What the union insists on is for the government to allocate a 50% share of the market to certified eggs in the sixth five-year development plan (2016-21). The government seems reluctant to go ahead with this plan since it is worried about the high prices of such products.

“It is true that wholesale eggs are half the price of certified ones, but if the government agrees to the proposal, it will help stabilize the prices and balance the market,” he said.

Five-year development plans are medium-term roadmaps designed by the government to help achieve sustainable growth.

“According to the Central Bank of Iran, egg constitutes 0.07% of Iranian household expenses, which is insignificant. Iran’s per capita egg consumption is 190 a year, whereas it needs to be 250,” said Talakesh.

Some 95% of Iran’s eggs are exported to Iraq, Afghanistan and Central Asian countries. Trade in this field is limited to the neighboring countries since eggs cannot travel long distances.

Talakesh said Iranian eggs are among the best in the world and that the country, alongside India, Pakistan, Ukraine and Turkey, are the main suppliers in the region.

“In the past few years, we helped some Central Asian countries build the required infrastructure for the industry. This made them self-sufficient in the field and therefore we lost some of our markets,” he said.

Nasser Nabipour, head of board of directors at Tehran’s Union of Producers of Egg-Laying Chicken, said since a month and a half ago and after Turkey entered the global market, Iran’s egg exports have halved.

Lower exports, together with overproduction, have led to the decline in prices in the domestic market.

“Investment for the modernization of egg distribution system can be very profitable,” Talakesh said, adding that terminals for collecting eggs are being created in seven major provinces, from where they would be distributed.