Egg farmers cracking under price spikes
Published:Thursday | March 17, 2022 | 12:06 AMLeon Jackson/Gleaner Writer
WESTERN BUREAU:
DARK CLOUDS are hovering over the businesses of egg farmers in Jamaica. And given a huge and continuous spike in costs in production inputs like feed, it has been predicted that small-scale interests with 1,000 or fewer could collapse.
Larger players with more than 5,000 layers are also at grave risks, industry insiders say.
Mark Campbell, a large-scale egg producer who has been in the sector for 41 years, disclosed in a Gleaner interview that inflation and coronavirus-linked market pressures have cast a shadow over the industry.
“COVID-19 has had a negative effect on us. Despite that fact, it is the worst I have experienced since Hurricane Gilbert,” he said, referring to the 1988 monster storm that battered Jamaica’s farm sector and destroyed many buildings.
“When COVID hit the industry, many farmers had to sell their birds as stewing hens. The market for eggs went flat. Now that there is an improvement, farmers are struggling to replenish their stock,” Campbell added.
The veteran chicken farmer revealed that the value of layer hens has increased to $1,395 for 199 or fewer, while it costs $1,295 for 200 or more. The price of feed has more than doubled in three months from $60,000 per ton to $96,000.
Campbell insists that many small investors simply cannot absorb the increased cost of production.
His concerns have been echoed by Doreen Hibbert, manager of the Jamaica Egg Farmers Association, who has warned said that the current conditions could wipe out many producers.
Citing a 28 per cent increase in feed costs since January, Hibbert warned that the risk arose that smaller farmers would fall by the wayside, thus sparking a supply shortage.
“To start with, the increased feed price is going to result in the death of the small farmer as a business person. Every month there is an increase in the price of feed,” Hibbert told The Gleaner.
INCREASE UNBEARABLE
Melrose Cummings, a small egg farmer, said the rapid price increases have become unbearable.
Cummings said that spiralling price hikes are forcing her to set break-even costs of $1,000 per flat of eggs. A flat constitutes 30 eggs. But that price, she said, is unaffordable for the average consumer.
“I have to buy sawdust frequently. That has gone up. I deliver to my customers. One time to deliver I would buy $5,000 gas. Now to cover the same journey it is $8,000. Only God can help,” she exclaimed, throwing her hands in the air.
Hibbert predicted that a “tightening” of supply could trigger the need for imports to fill the breach – but that intervention, she said, might not be feasible.
“That would be disastrous. Towards the end of 2021, to bring in a 40-foot container was costing US$5,000. Now that same container is US$18,000. That does not include the cost of insurance and freight. I don’t even want to think about it,” Hibbert exclaimed.
President of the Jamaica Agricultural Society (JAS), Lenworth Fulton, argued that there needs to be an industrywide policy review.
Eggs are among the cheapest forms of protein but are increasingly out of the reach, said Fulton, of “the little man”.
“When you look at the production of feed, almost all the ingredients are imported. Look how much idle lands Government has. Why is there no policy to encourage the planting of corn, a key ingredient in the production of feed?” the JAS president questioned.
Fulton has clamoured for greater local investment in research and development .
Citing the two main methods of production – caging and deep litter – Hibbert has urged the authorities to explore cheaper inputs to drive down the operational expenses of farmers.
Cages, he said, are more efficient and cheaper, but those costs have been rising as well as because they are sourced from China. That is constantly being increased. They try to absorb some of the costs.
“Other things influence the farmer. Eighteen months is the life of a laying bird. If they go longer, they don’t lay as frequently, but they continue to eat and produce less,” Hibbert said.
“The eggs for layers come as imported and fertilised. If there is a shortage of fertilised eggs, then layers will be short, hence shortage of eggs. A policy to deal with our situation has to be developed,” Hibbert said.