December 7 2017 – THE price of eggs is set to increase further after a significant jump in the past few months, owing to the outbreak of the Avian Influenza during 2017, says FNB.
The bank’s senior agricultural economist at FNB Business, Paul Makube, says that the impact of bird flu on South Africa’s consumer was likely to see egg prices increase in the range of 15 percent to 20 percent in the next few months.
“The increase in egg prices is subject to demand and supply dynamics with the Influenza outbreak having a major influence on the recent spike,” Makube said.
“The impact on prices has been more pronounced in the Western Cape due to the culling of layer hens and the subsequent supply shortages on the region’s shelves.”
The Influenza hit the poultry industry as it was starting to recover from the drought which saw many commercial and particularly small farmers struggling to keep up with the increase in the price of feed towards the end of 2016 and the beginning of the current year.
According to the latest data from Statistics South Africa (StatsSA), the price of eggs increased by 8.5 percent year-on-year during October 2017.
The industry has already recorded a 12 percent year-on-year decrease in the average weekly egg production during September 2017, according to the SA Poultry Association (SAPA).
Makube said this trend was likely to continue in the short to medium term as supply shortages were likely to last up to a year, but demand will not change very dramatically with per capita consumption remaining around 7.9kg per person per year.
He said the downstream impact is that retailers will be selling eggs at higher prices this festive season, therefore consumers will pay more for a tray of eggs.
“The upside is that the price increase will help producers to recoup losses as they are still servicing debt incurred during the last drought,” Makube said.
“It will further place them in a better position to repopulate and increase their production which will eventually benefit the consumer in terms of an affordable source of protein.”
– African News Agency (ANA), Editing by Catherine Rice