September 4, 2019

Indonesia to discard hatchery eggs to support record-low chicken meat prices

The Indonesian government is asking poultry breeders to throw away 10 million eggs or give them away for free in an attempt to support dismal chicken prices, Bloomberg reported.

The government is hoping that a reduction in the number of eggs that may hatch will cut chicken supplies and raise retail prices that are near a three-year low.

Average retail price of chicken meat has plunged 25% this year to 30,050 rupiah (US$2) per kilogram, according to the central bank-run Center for Information of Strategic Food Price. That's the lowest since at least July 2016, when the Center began compiling the data.

"The only way we can do something about it is by discarding 10 million 19-day old hatchery eggs," said I Ketut Diarmita, director general of Livestock and Animal Health. "It will have a psychological impact on the market," he added.

The plan follows an order in June to cull parent-stock chickens that are older than 68 weeks to help breeders fetch good prices for their flocks.

At least 45 poultry-breeding companies, including PT Japfa Comfeed Indonesia and PT Malindo Feedmill, will join the programme until September 20, according to the agriculture ministry.

The programme may have an impact on the supply-demand situation in October and can help breeders avoid further losses, according to Achmad Dawami, chairman of the Indonesia Poultry Breeding Association.

Shares of poultry producers have suffered a hit from the falling prices. Total losses for shares of PT Charoen Pokphand Indonesia have reached about 34%. Malindo Feedmill shares saw a greater fall of 36%, while Japfa Comfeed dropped nearly 29%.