Ministry of Agriculture: prices for poultry meat will begin to decline in September

The Ministry also notes the positive dynamics in poultry production. During January-July of this year, the production of poultry for slaughter in agricultural organizations increased by 1.3% compared to the same period last year and amounted to 3.8 million tons in live weight.

Deputy Chairman of the Board of the Rusprodsoyuz Association Dmitry Leonov said that average retail prices for chicken MEAT are 205.7 rubles/kg, which is 1.3% higher than a week earlier and 4.5% more than a month ago. In his opinion, this is influenced by the cost of grain for feed production, the share of which is up to 60% of the cost of its production. Exchange rate dynamics also matter: the cost of vitamin supplements and premixes is tied to the DOLLAR exchange rate. “There are other production costs: the cost of electricity, gas, water supply, biowaste disposal, logistics, and so on. Further price dynamics will depend on the above factors, as well as on the balance of supply and demand in the market,” he believes.

According to Rosstat, in July the production of chilled poultry meat amounted to 271.6 thousand tons. This is 2.1% less than in July 2022 and 1.5% lower than in June 2023. Over seven months, production increased by 1.8% to 2 million tons. The statistical agency also reported that in the week from August 15 to 21, among livestock products, prices for pork and chicken meat increased most significantly. During this period, these products increased in price by 1.4%. Prices for chicken meat increased in 79 regions ranging from 0.1% to 4.2%. A decrease in prices for this category of goods was observed only in three regions. Since the beginning of the year, prices for chicken meat have increased by 16.14%.

The HEAD of the InfoLine agency, Ivan Fedyakov, said that prices for poultry meat are now really rising. According to him, producers are sensitive to the ruble exchange rate, and now they can use its weakening as an excuse for raising prices. “Of the meat group, poultry is the most affordable. At the same time, the margins of producers are very low; in previous months they worked almost at zero, afraid to raise prices. Now they have the opportunity to increase the cost of goods and compensate for the losses that occurred in the spring,” he said.

According to Fedyakov, the cost of poultry meat will continue to increase following the weakening of the ruble. Manufacturers have other problems besides foreign exchange rates, he noted. For example, high interest rates on loans, which are also included in the cost of production. Another unpleasant factor is the lack of personnel at poultry enterprises. For example, the Sinyavinskaya  poultry farm , which lacks 25% of its employees, faced such a difficulty. According to Fedyakov, “there is an acute shortage of personnel in the regions.” 

The expert believes that there are no factors on the agenda now that could restrain price increases, with the exception of falling household incomes and low purchasing power. This does not allow the increase in cost to be fully translated into the price of the final product. In this case, the consumer may simply refuse to purchase more expensive products. In his opinion, in September prices for poultry meat are unlikely to decrease, since if you look at the statistics of previous years, the situation was exactly the opposite - in the summer, prices began to decline, and closer to the middle and end of autumn they rose again. 

In mid-August, the Federal Antimonopoly Service (FAS) began checking the validity of the increase in wholesale selling prices for poultry meat, the regulator’s press service reported. Inquiries were sent to the three largest producers of poultry meat, animal feed and representatives of industry associations. The service noted that any measures would be taken after the inspections were completed.

Meanwhile, Izvestia reported that shawarma producers announced a planned price indexation from September at the level of 10-15%. The main reason is the rise in price of poultry meat, which can lead to an increase in the final price for this fast food dish from 210 rubles. up to 300 rubles, while now shawarma can be bought for 190-250 rubles. Price increases are already underway, the final decision will be made in the near future after receiving new supplies of meat, Mosshaurma told the publication.