EGG farmers are demanding that the government remove the ceiling price for eggs as soon as possible and allow market forces to determine the price.

They said this could be implemented immediately to ease the nationwide egg shortage.

Supermarket tycoon Ameer Ali Mydin accused the Ministry of Agriculture and Food Industries (Mafi) of failing to deliver on its promise to overcome the shortage, adding that his supermarket chain had been hit hard.

Ameer said egg suppliers could only meet 40% of his supermarkets’ demand, describing the situation as serious.

Ameer said he had been informed that egg farmers were cutting back on production because they were losing money due to the price cap.

As the shortage persists with no solution in sight, he forewarned of major problems during Hari Raya Aidilfitri in six months, when the demand for eggs is usually high.

He said this demand would start three months before the festival, when people start baking cakes, biscuits, pastries and other delicacies.

Piqued by the government’s continued silence on the shortage, Ameer said the present policy only helps control the price of eggs to make it affordable for consumers.

However, he pointed out, that policy is the cause of the shortage as egg farmers cut back on production to remain profitable.

He said it would be better if there is a policy that helps increase supply.

“I am sure, with the removal of the price cap, the price of regular eggs will not eclipse that of AA eggs.”

Ameer said the government needs to act now to avoid a ‘Raya of Discontent’.

“It does not take one day for farms to produce the eggs needed to meet demand.”

Higher feeding cost

Lee Yoon Yeau, deputy president of the Federation of Livestock Farmers Associations of Malaysia, said subsidies for chicken and egg farmers that ended on August 31, should be reinstated to overcome the shortage.

Lee told The Malaysian Insight the government needs to remove the price cap because it had battered the industry, with farmers trying to balance their books as costs continue to rise.

Feed is mostly imported, he said, and prices continue to rise – by 7% to 8% in the past two weeks – pushing production costs to 44 sen/egg.

Lee said in March, some farms had to scale back production by as much as 20%, culling their older, less productive chickens.

Lee said the ballooning cost of the feed was due to a poor harvest in exporting countries.

Meanwhile, the Malaysian ringgit continues to depreciate against the US dollar, making feed more expensive.

Lee said farmers can expect another price increase next month.

“When that happens, it will no longer be 44 sen/egg. It may cost farms with high overheads 46 sen, already past the ceiling price.

“The government has still not said whether the cap will be removed. We have been transparent about how much we pay for importing the feed and our operating costs.

“The government is aware of our profits and losses, so consumers should ask the government if they want to know why prices keep going up.”

Lee also pointed out that if the price of feed continues to rise, then breeder farms would have problems producing chicks.

“They need to be fed.”

Lee said farms are not “machine factories” and the chickens are not machines, where production could be set at a constant rate.

“It’s not like you can recover production in a day or increase production if you feed the birds a little bit more.

“Poultry farming is dependent on a lot of variables. It’s dependent on the weather.

“Chickens are susceptible to disease and the environment. If the chickens are sick, they can’t lay eggs of the required quality.

“If the eggs are too small, we can’t sell them.”

Eggs won’t cost more than 50 sen each

Lee said the government must subsidise chicken feed.

The feed, he pointed out, accounts for 80% of a farm’s operating costs, while the rest is spent on buying chicks and vaccines, staff salary and paying utility bills.

Lee said if the government removed the price cap, the price of an ordinary egg would not be more than 50 sen and the public could still afford it.

He said even at 50 sen, the eggs in Malaysia would still be the cheapest “in southeast Asia”.

“In Singapore, they cost 87-90 sen, 62 sen in Thailand 62 sen and 60 sen in Indonesia.”

Egg farmer Wong Wei Chang told The Malaysian Insight that last year, the price of the feed was RM1,000/tonne. Now it’s RM2,300/tonne.

“With corn feed up 40%, soybean prices already up to RM3,000/tonne and 70% of the ingredients in the feed going up, the pressure on egg farmers will only get higher,” Wong said.

He said unexpectedly cooler conditions had also caused more egg laying chickens to die, adding to the overall shortage.

“It takes about five months for the chicks to grow and lay eggs, and about three months after that for the shortage to ease.

“If the government wants to solve the problem, that’s the time: five months.”

Wong said to cut his losses, he throttled production at his farm to 120,000 eggs a day, compared to the 160,000 and 170,000 a day in past years.

On August 29, the chairman of the Special Task Force on Jihad Against Inflation Annuar Musa announced that the current price cap would continue after August 31 and that the 3 sen/egg subsidy would also remain unchanged.

Previously, the government announced the ceiling price for Grade A, B and C eggs would be 45 sen, 43 sen and 41 sen respectively, for two months from July 1. – October 2, 2022.