Poultry farmers have blamed the “machinations of middlemen” and “supply-demand mismatch due to disruption in the supply chain” for the sudden price spiral of eggs and chicken, one of the major sources of protein intake for tens of millions of Bangladeshis.
Claiming that farmers had no hands in the recent “price manipulation”, the Bangladesh Poultry Industries Central Council, or BPICC, in a statement on Friday regretted the ordeals consumers had been going through for such a massive price rise, reports bdnews24.com.
“The council expresses its concern and regret the recent sudden increase in the prices of eggs and chicken in the open market, which has increased the suffering of consumers,” reads the statement.
Over the past week, the price of eggs per dozen, produced on poultry farms, across the country, increased to Tk 150 from Tk 110. The price of broiler chicken increased to Tk 200 from Tk 140 per kg.
Farmers say middlemen and supply-demand mismatch drove prices of eggs, chicken
The Bangladesh Directorate of National Consumer Rights Protection, an organisation responsible for addressing consumer complaints over goods and services, went into action immediately as they identified manipulations by several wholesalers for the skyrocketing prices.
As a result, from Friday, the prices of eggs suddenly went down by Tk 30 per dozen and broiler chicken by Tk 20.
In Dhaka’s retail market on Friday, it was found that eggs are being sold at Tk 120 per dozen while the chicken is being sold at Tk 180 per kg.
Suggesting a strong monitoring system be developed in coordination with the Department of Livestock and the BPICC to avoid such situations in the future, the statement reads: "Demand-supply gap and greedy efforts of opportunistic middlemen are mainly responsible for this unintended price hike."
The BPICC statement also referred to its own investigation that blamed the disruption of the supply chain on the government's decision of raising the fuel price to a historic high level on Aug 6.
Farmers say middlemen and supply-demand mismatch drove prices of eggs, chicken
The statement says from the next day, many transport owners simply refused to carry poultry items, and some charged additional rent, which triggered the supply chain crisis
“As 85 to 90 percent of eggs and chickens are supplied by farmers based in the countryside, the supply in Dhaka and other cities was disrupted because of it [transport owners' refusal to carry goods].
The crisis reached a critical mass on Aug 13 and 14, as the prices of brown eggs were increased to Tk 10.9 per piece while the price of broiler chicken went up to Tk 170- Tk 175 at the wholesale level.
According to the Trading Corporation of Bangladesh, the price of each egg at the retail level during the said week was Tk 13.75 while the price of broiler chicken was Tk 200 per kg.
OMINOUS SIGNS FOR FARMERS, BREEDERS, AND FEED IMPORTERS
Every industry stakeholder bdnews24.com had spoken to were worried that the whole industry may take a turn to the worst from an already bad situation if the government does not intervene.
When interviewed, the council’s president, Masiur Rahman, said that currently, the cost of producing one kg of broiler chicken is Tk 140 to Tk 145, and each egg costs at least Tk 9.50 at the production level.
Farmers say middlemen and supply-demand mismatch drove prices of eggs, chicken
According to him, the farmers were already selling broiler chicken at a loss of at least Tk 12-14 per kg while the so-called middlemen were making profits of Tk 27-32 per kg.
"Production costs [for eggs and chicken] have increased by 30 to 40 percent due to an abnormal increase in the prices of raw materials for making feed in the international market, depreciation of the local currency against the US dollar, a rise in shipping cost to import products, and ongoing intermittent power cuts,” he said.
"The concern is that even though the farmers are counting the losses, the middlemen are getting more aggressive to make more profit. As a result, both the farmers and the consumers are deprived of expected returns.”
“In a market system, there will always be middlemen. But the profit-seeking behaviour should be reasonable. If marginal farmers do not get fair prices, the production system will collapse,” Masiur warned.
Therefore, the BPICC president asked the government to make short and long-term plans to protect marginal farmers.
Farmers say middlemen and supply-demand mismatch drove prices of eggs, chicken
Kazi Zahin Hasan, president of the Breeders Association of Bangladesh, agreed with Masiur that the continuing loss had forced a good number of farmers to leave the business altogether
He also broke down some numbers to paint the dreadful scenarios in the industry.
Zahin said the weekly production of one-day-old white broiler chicks in Jan-Feb this year was over 1.8 million, which had come down to 1.30-3.5 million now.
Last May, broiler chicks were sold at an average of Tk 16.65 and layer chicks were sold at Tk 20.74. Within a month in June, the price of broiler chicks went down to an average of Tk 8.07 and layer chicks at Tk 13. In July, broiler chicks were sold at Tk 18.71 and layer chicks were sold at Tk 13.95.
“Even after the breeders sell the chicks at a loss, the farmers are not interested in buying the chicks. It is worrying,” he said.
President of Feed Industries Association Bangladesh Shamsul Arefin Khaled said due to the increase in the price of raw materials in the international market, there has been a chicken food crisis all over the world.
Farmers say middlemen and supply-demand mismatch drove prices of eggs, chicken
"Just when the palpable pressure of the pandemic started to become tolerable, the price of raw materials for chicken feed in the domestic and international markets rose due to the Ukraine-Russia war.
“Since most of the essential raw materials for making feed, including corn, and soybeans, are import dependent, we won’t be able to do business without increasing the price of the chicken feed. The vessel fare and the upshot of dollar prices are making a bad situation worse,” he said.
He emphasised focusing more on producing raw materials of feed domestically and urged the government to keep the massive industry alive by providing farmers with subsidies.
