PoultryWorld: Ukraine egg industry in dire straits

Ukraine recently imported eggs from Belarus as the crisis-ridden egg industry fails to meet domestic demand, Sergey Karpenko, executive director of the Ukraine Association of Poultry Producers, said. Since the beginning of 2021, Ukraine’s egg production has plummeted by 25% (3 billion eggs) compared to 2020.

As many as 30 egg farms and 9 broiler meat farms have been shut down, said Karpenko. His comment is in line with the data released by the Ukraine State Statistical service, which estimated that in the first 9 months of 2021, Ukraine cut egg production by 2.4% year-to-year comparison to 6.8 billion pieces.

Ukraine’s poultry stock dropped by 11 million heads during the past 2 years, while broiler meat production decreased by 40,000 tonnes. These factors would inevitably drive poultry and egg prices up on the domestic market, Karpenko said.

Dwindling egg exports

During the first 9 months of 2021, Ukraine exported 32,000 tonnes of eggs, compared to 90,000 tonnes during the same period of the previous year, according to the Ukraine State Customs Service. This is the strongest production decline ever seen. In monetary terms, export dropped by more than half to US$ 33 million. The biggest importers of Ukraine eggs were the UAE, Latvia, and Saudi Arabia, with shares of 39.4%, 23.7%, and 6.3%, respectively.

Rising costs and anticipated green tax

Ukraine poultry producers suffer losses due to unprecedentedly high electricity, natural gas, and feedstuff prices. As explained by Karpenko, some share of the Ukraine poultry industry remains loss-making. An anticipated rise in green tax under a so-called ‘anti-oligarch law’ is expected to become another factor of rising pressure on the Ukraine poultry industry.

“The rise in tax burden expected with the adoption of this law would lead to an even greater drop in egg production in Ukraine, and a further rise in domestic prices,” Svetlana Livin, analyst of the Ukraine Club of Agricultural Business, said.

Skyrocketing price of eggs

Since the beginning of 2021, the price for eggs in Ukraine has jumped by 66%, Livin estimated, adding that the prices are yet to hit the ceiling. The price is likely to stand at 40 hryvnias (US$ 1.5) per 10 eggs until spring of 2022 when a possible growth of industrial egg production could improve market conditions, Litvin said.

The drop in exports is among the factors contributing to the price increase on the domestic market since it entails a decline in foreign exchange revenue for Ukrainian farmers, she added.

 

Vladislav Vorotnikov

Russian correspondent