July 22, 2012

 

 

Following the bird flu outbreak which has so far prompted the destruction of 3.8 million chickens, Mexico's egg exports could be "jeopardised" and leave a hangover of a production drop extending into next year.

 

Mexico's egg production will fall some 10.5% to 2.3 million tonnes in 2013, in addition a hit this year from an outbreak of so-called high pathogenic avian influenza in the state of Jalisco, responsible for half the country's table egg production, USDA officials said.

 

The bird flu variety, H7N3, has caused human infections, but is not easily spread from person to person, according to the United Nations.

 

While Mexican egg processors are attempting to turn to imports to fill the void in supplies, and meet export contracts which represent an important part of their earnings, "there is considerable industry doubt" that buy-ins are "commercially feasible".

 

The outbreak leaves "jeopardised" the foreign shipments which accounted for 11% of domestic production last year, the USDA bureau in Mexico City said, adding that "exports could be restricted due to supply".

 

Mexican officials earlier this month opened a 221,000-tonne tariff-free quota on egg imports from China, Poland, Turkey and Ukraine, in part to help bolster domestic supplies of a product which represents a staple food in the country.

 

Mexicans each eat 22.5 kilogrammes of eggs a year, equivalent to nearly one egg per day, making them amongst the world's keenest consumers. However, egg prices in Mexico City soared more than 50% in the first week of July alone because of reluctance to source eggs from Jalisco, even areas outside those quarantined because of the bird flu outbreak.

 

This has further tested consumers already facing higher tortilla prices thanks to persistent drought which has dented domestic corn production. However, sources have termed the effort to boost egg imports "somewhat confusing", the USDA staff said in a report.

 

"Importing eggs from China is not a feasible option" while Polish exports are aimed at other EU countries, which are "paying a higher price compared to those that Mexico could pay".

 

"Ukraine will be in a similar situation," the briefing said.

 

Meanwhile, imports from Turkey "would take up to 40 days for transit and costs would be passed along to consumers at prices likely beyond their purchasing power".

 

"Some private sources have declared that the [import] announcement appears to be a manoeuvre to calm prices from escalating further and to unveil the possibility of using legal tools to control speculation."

 

According to official data, food safety inspectors had visited 253 poultry farms in Jalisco as of July 16, of which 82 were found free of the virus, 33 infected and the rest awaiting test results.

 

Some 3.8 billion birds have been "depopulated" so far in an effort to control the spread of the disease.