MLBA7: February / March 2009

The chicken egg dilemma

In Thailand, 27-28 million eggs are released daily into the market, while consumption is only 25-26 million a day.  That leaves a surplus of 2 million eggs per day. The situation worsens from October every year when 30 percent of the country's population shuns all kinds of meat, including egg, as they celebrate the ten-day vegetarian festival. This leaves a surplus of 70-80 million eggs at the end of the festival, causing prices to fall dramatically.

Compounding the problem is the rising cost of commercial feeds. Under pressure from feed millers, the government allowed last year a 10-20 percent increase in the price of commercial feeds, under state control since 2004.

Mr. Manoch Chootabtim, president of the 400-member Layer Farmers Association, said that Thailand's egg industry situation is dire. The supply is high while demand is low - resulting in very low prices. The average price per egg now is THB1.90 while cost of production is THB2.10 each. Farmers have been accumulating losses for more than two years now.

Egg farmers cut costs where they can and raise other things, like tilapia in their farms, using chicken manure as fish feeds. Some of them enter into layer-farming contracts with integrated companies. These companies buy all produced eggs from their contractors at guaranteed prices, often higher than the market price. But there's a catch: contract farmer must get their supplies - hens, feeds, antibiotics, etc. - from the contracting company, usually at prices also higher than those prevailing in the market. Contract farmers end up with barely enough to survive till the next cropping season.