Egg price falls, farmers sell eggs at loss

Prices of commercially produced eggs have fallen recently. High prices over the last few years motivated farmers to increase production.

Unfortunately, production is now higher than demand, leading to very low egg prices and losses for farmers.

Farmers sold white eggs at Tk 7.10 per egg and brown eggs at Tk 8.10 per egg in Rajshahi on 4 December. Farmers estimate that they are now losing at least Tk 1 per egg on average.

Zearul Islam (32), a farmer of Kolipur in Godagari, Rajshahi, said, "We have seen egg prices decrease during winter, but this year the price is too low for us to survive. Perhaps the production is much higher than the market demand." He has 6,500 hens which lay about 5,300 eggs each day. He said that prices of white and brown eggs have decreased by Tk 1.00 per egg, from Tk 8.1 and 9.1 in October. He said that he made a loss of Tk 50,000 in the month of November.

Asked why egg price decreased so much, Zearul Islam observed that the number of farms has increased, and production of eggs has also increased.  Winter vegetables and local varieties of fish are now abundantly available, so many consumers are eating less eggs.

Sujon Ali (26), a layer farmer who owns 2200 hens in Dohachhi, Gadagari, said production of eggs at his farm was more than 90 per cent, but he had to sell each white egg at Tk 7, though his production cost was not less than Tk 8 per egg. "If the current price continues, we have spend money from our pockets to run our farms," he said.

Mohammad Asaduzzaman (27), a graduate and new farmer of Afi Nepalpara in Poba, said, "I am happy that I am producing around 1250 eggs every day from a farm of 1300 hens, but I am wondering whether I will be able to continue if the egg price remains low," he pointed out.

Mizanur Rahman (32), manager of Rocky Traders, an egg trading house at Moslemer Morh in Poba, said that they buy around 55,000 eggs each day, and sell to wholesale traders in different districts. "These days there is less demand for eggs in different markets. We see that the farmers are suffering due to the low price," he said.

Joynal Abedin, a middle-aged trader and poultry farmer in the same area of Poba, buys more than 150,000 eggs each day from surrounding areas and supplies them to different markets. "We struggle to sell eggs. I have halved my egg production at my own farm to 15,000. I think many marginal farmers will not survive in this market," he added.

On the price situation, Kazi Zahin Hasan, Director at Kazi Farms, said, "The market price of eggs depends on supply and demand. Over the last couple of years, egg prices were high. This has motivated farmers to increase production. There are no accurate statistics on total egg production, as no one know how many eggs are produced by backyard chickens owned by village households. However, we estimate that commercial egg farms are now producing over 5.2 crore eggs each day. Last year at this time, commercial egg farms were producing about 3.5 crore eggs per day.  The present low egg price indicates that supply now exceeds demand."

He added, "Many government officers have alleged that there is a cartel controlling the price of eggs. But if there were a cartel, and if it were able to control the price, why would it allow the price to fall? The truth is that thousands of farmers sell eggs every day. Markets with thousands of sellers are always competitive markets."

A professor of economics at Jahangirnagar University, Asrar Chowdhury said that as eggs are perishable, and can't easily be stored, the price falls when production exceeds demand. He said, "In winter we observe the availability of substitute foods like vegetables. If these substitutes are reasonable in price, people will tend to buy them for variety in their diet."

The economist also expressed his view that the egg market is highly competitive. "It is very difficult for a group of sellers or a group of buyers to influence the market. Market forces, the availability of substitute foods and the perishability of eggs have all contributed to the low price of eggs," he said.