MAFI Explains Decline In Profit Margins For Egg Producers

KUALA LUMPUR: The increase in chicken feed prices and the significant drop in egg prices during the COVID-19 pandemic are among the reasons for the decline in the profit margins of egg producers, said Agriculture and Food Industries Minister Datuk Seri Dr Ronald Kiandee.

He said based on the market price for Grade C eggs, there has been a significant drop of 38 per cent to RM0.21 per egg in November 2020, compared to RM0.34 per egg in April 2020.

“Production costs have increased due to the increase in chicken food prices between four and five per cent. The cost of chicken feed contributes 70 per cent of the total production cost,” he said in a written reply during the Minister’s Question Time in the Dewan Rakyat today.

He was replying to a question from Datuk Jalaluddin Alias (BN-Jelebu) on how much the COVID-19 pandemic has impacted the egg production sector.

Kiandee said the increase in chicken feed prices this year was influenced by an increase in the price of the base ingredients for chicken feed such as corn by 15.2 per cent to RM1,100 per tonne in November, compared to RM955 per tonne in April and soybeans that increased by 9.4 per cent to RM2,100 per tonne in November compared to RM1,920 per tonne in April.

Kiandee said the prices of the these base ingredients are determined by global commodity market prices.

He said the ministry is now holding discussions with the manufacturers and association for animal feed producers to find the best solution as a short-term intervention measure.

“At the same time, to ensure adequate supply of food especially eggs, MAFI always monitors the daily food supplies since the implementation of MCO, besides ensuring the welfare of local breeders.

“Information within the country that is received from government agencies, industry players and agriculture entrepreneurs is always monitored and analysed regularly,” he added.