How they will combat the rise in chicken egg prices in Russia: three solutions have been found

Eggs are becoming more expensive.

Photo: Nikolay OBEREMCHENKO

Have you noticed this too? Eggs are becoming more expensive. According to the president of the Russian Consumer Union, Pyotr Shelishch, eggs repeat the fate of chicken meat, the price of which has increased by 36% since the beginning of the year. Eggs – already 32%.

– In addition, over the last month, according to Rosstat, the price has increased by 15%. This represents almost half of the year’s total growth, adds the expert.

What are the reasons for this jump?

“First of all, there is a seasonal increase, which always occurs before the New Year and before Easter,” says Galina Bobyleva, head of the Russian Poultry Union. – Secondly, inflationary processes also had their impact. You yourself will be able to see how the prices of feed, spare parts for poultry farm equipment, packaging, etc. are rising. Third, demand is increasing. But at the same time, the volume of egg production does not decrease. This year it will be at the same level as last year: approximately 46 billion units. That is to say, there is no shortage of eggs on the market! You can see for yourself how much is presented on the shelves! Any store has different categories from different manufacturers.

Elena Stepanova, deputy general director of the Russian Poultry Union, explains that the price frenzy was started by retail chains.

“There are not many long-term contracts in which volumes and prices are set,” says the expert. – The remaining volumes are purchased through tenders on the exchange. There prices are usually higher than those for long-term contracts.

5% MARKING

Since eggs are included in the list of products of social importance, their prices are controlled by the state. For this reason, the Federal Antimonopoly Service proposed that retail chains limit profit margins on eggs to 5%. The experts are in favor with both hands.

“The Russian Poultry Union has been presenting this proposal for several years,” says Galina Bobyleva. – The FAS proposal is very reasonable.

The president of the Russian Consumer Union, Petr Shelishch, also supports the FAS decision. He will help stabilize prices for the benefit, first of all, of low-income Russians.

“Eggs are included in the category of essential products,” he explains. – We can substitute the types of meat with each other, but not the eggs. But it is not necessary to make it too cheap either: the price should establish a balance between supply and demand.

EXPORT AND IMPORT

To stabilize egg prices in the domestic market, the Ministry of Agriculture proposes two more measures. The first is the reduction to zero of duties on egg imports.

“Eggs are imported to Russia from Belarus and Kazakhstan,” explains Elena Stepanova. – This is a close established collaboration. Do we need a tax-free measure if we are able to solve the problems of our internal market ourselves? You just need to create competent interaction with retail chains.

The second measure is a six-month limitation on export supplies. On November 3, the Ministry of Agriculture prepared a draft government resolution “On the introduction of a temporary ban on the export of edible eggs from domestic chickens of the Russian Federation” from December 1 to May 31, 2024.

“On the one hand, in the event of an export ban, more products will be destined for the domestic market,” says Peter Shelishch. – On the other hand, producers will lose a part of the profits because we sell eggs abroad at a higher price.

Elena Stepanova, representative of Rosptitsesoyuz, explains this in more detail. The current volume of egg exports is about 500 million. This is only 1% of the total production. And this percentage is unlikely to have any influence. But she will add a series of other problems.

“Basically, our eggs are exported to Mongolia and the exporters are companies from the Irkutsk and Chita regions,” says Elena Stepanova. – And if today they are prohibited from exporting eggs, they will stay in these regions, which already have a very high percentage of self-sufficiency (in the Irkutsk region, 156%). This means that there will be no demand in the domestic market for this volume. Companies will be forced to cut production and employment. In addition, they will incur serious expenses and losses in relation to the payment of the penalties provided for in the contracts. Companies from the Irkutsk region have been supplying products to Mongolia for more than 20 years and have proven themselves well in this market, occupying a significant part of it. And if the Ministry of Agriculture imposes an export ban for six months (as planned), our companies are unlikely to return to this market. As a result, we will lose much more than we gain.