The Ministry of Agriculture will increase egg factories subsidies

In May 2022, egg prices decreased by 8.1% year on year. This trend has been observed since the beginning of the year. In some parts, prices are falling due to government subsidies. In our opinion, the allocation of additional budget funds to support the egg factories, despite the increase in costs for manufacturers will allow prices to be held.

At the same time, according to the Ministry of Agriculture, feed procurement costs account for about 70% of all manufacturer costs in poultry farming. The main part of the feed is imported from China, Uzbekistan, and Russia. The global increase in grain prices leads to an increase in the cost of feed, which naturally affects the price of poultry products. Problems with logistics and production due to the geopolitical crisis make a significant contribution to the price increase.

We believe that subsidizing prices does not eliminate the sources of problems, perhaps a more systematic approach is needed. It is necessary to stimulate the development of domestic production to reduce the dependence of domestic poultry farming on imported compound feed, especially taking into account the growth of their prices, exchange rate, and logistics costs.

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