Officials pecked at the chicken. Poultry farmers threatened with price regulation

Possible fixing of prices for poultry meat will lead to an imbalance in the market, a reduction in supply and is practically impossible from a technical point of view, market participants believe. The fact that the idea is being discussed in the government became known following a meeting of the operational headquarters for monitoring the situation with socially significant products. Retail prices for poultry meat and eggs have already risen by more than 10% in two months and may continue to increase due to a seasonal surge in demand. Producers hope that the government will still not regulate prices, and they recalled the mechanism there as an element of psychological pressure.

The government may decide to set maximum retail prices for poultry meat and eggs, Deputy Minister of Agriculture Oksana Lut said at an April 13 meeting of the operational headquarters for monitoring the situation with socially significant products. According to her, prices for these categories in all regions of Russia over the past 60 days have increased by more than 10%, which gives the right to launch the mechanism.

According to Rosstat, in March, poultry meat prices rose by 7.2%, and by 14.3% in the first quarter of 2021.

Under current regulations, prices can be fixed for up to 90 days. Officially, the Ministry of Agriculture stated that the issue does not fall within their competence. The Ministry of Economy did not receive proposals to fix prices. The government press service did not respond to a request.

The head of the National Meat Association, Sergei Yushin, believes that it is technically impossible to fix prices for broiler meat. According to him, the bird of one manufacturer differs from the bird of another in a dozen parameters: weight, packaging, quality, feed used. The cost, credit burden and production plans of the companies are also different. In addition, he clarifies, if you fix prices for final products, then it is logical to do this along the entire chain - for grain, feed, vitamins and amino acids, veterinary drugs, packaging, fuel. According to the interlocutor of Kommersant in a large grocery company, unlike sunflower oil and sugar, poultry meat and eggs are not exchange goods, therefore it is not clear which indicator to take as a basis for fixing prices. But he considers the statement itself a bad sign for the market, where non-market mechanisms are becoming more and more popular.

Director General of the National Union of Poultry Breeders (includes Cherkizovo, Prodo, Prioskolie, GAP Resource, Agrocomplex named after N. I. Tkachev) Sergei Lakhtyukov said that any regulation would only lead to market imbalance. But he considers Ms. Loot's statement more like a reminder to market participants about the existence of the mechanism than a real decision. Agrifood Strategies President Albert Davleev agrees that this is an additional warning for poultry farmers. According to him, if there is regulation, it will be for eggs, and "poultry meat producers have reduced prices in the last two weeks."

According to a source in the industry, the wholesale cost of broiler meat has decreased from 145-150 rubles. up to 130-135 rubles. for 1 kg. In the first quarter, the production of poultry meat in the Russian Federation decreased by 6-7%, he notes, now many large companies are trying to increase production.

But prices continue to rise on the shelves, admits another interlocutor among manufacturers. Lenta assured that they are holding back the cost of chicken at the expense of other products and promotions. According to Azbuka Vkusa, on average, poultry meat has risen in price on the shelf by only 7.6% year on year. In these categories, the network works mainly with farmers and they will stop shipments when prices are fixed, the company says.

According to Sergei Yushin, the increase in prices for animal protein this year is a global trend associated with an increase in demand for meat in importing countries, primarily in China, a decrease in production due to animal diseases and a long period of low prices. Thus, in the United States , the world's largest producer of poultry meat, wholesale prices for a broiler carcass increased by 17% in the first quarter.

According to Albert Davleev, there are prerequisites for further growth in retail prices for poultry meat in Russia due to the seasonal increase in consumption. The May holidays, he explains, mark the end of Lent.