September 11, 2008

Poultry prices fell this week as the initial burst of Ramadan demand faded and families prepare to spend more on other foods and schooling.

By live body weight, the price of a chicken dropped from between 11 and 12 pounds (EGP) per kilo to EGP10-11. The cost of frozen chicken is down to EGP14.5-15.0 per kilo, said Mohamed El Shafei, vice chairman of the Poultry Council in Egypt.

Ramadan-driven demand helped fueled the rise in chicken prices which were already pushed up by the rise in feed prices, Mr El Shafei said.

While Ramadan generally sparks a rush for poultry, the effect was magnified this year as the opening of the holy month fell on the first of September, when many receive their paychecks. 

Earlier this week, several local press reports suggested the threat of antitrust action prodded poultry firms to lower prices.

Earlier, Minister of Trade and Industry Rachid Mohamed Rachid ordered an investigation into the cause of the sudden rise in prices and threatened state action against companies found guilty of wrongdoing. However no action has been taken so far.

El Shafei said he has explained to the government it was unlikely hoarding had caused the rise in prices as farmers would not be able to hold back chickens from the markets for long. Also, with 20,000 chicken farms in Egypt, it would be difficult for individual companies to collude on prices.

Mr El Shafei said he asked the government to compare poultry prices to those of other goods, like red meats and fish, which were similarly high. He added that he had convinced officials at the meeting that prices would go down next week.