Egg prices will rise if drought continues
Australian consumers could soon pay as much for locally
produced eggs as they would for imported ones, owing to the extra costs
associated with the ongoing drought conditions throughout much of the
The Australian Egg
says sudden hikes in grain prices have left farmers absorbing
high production costs - with grain being the single biggest variable cost to egg
The corporation's managing director, James Kellaway, said unless there was
a change in weather conditions soon, egg farmers were likely to see further
increases in the price of all grains.
â€œIn recent months, forward wheat contracts have risen from around $180 to
$310 per tonne,â€ Mr Kellaway said in a statement.
This current price increase translates to 20-30 cents extra per dozen eggs,
with prices now reaching import parity.
This will leave egg producers unable to compete with flour millers and
other grain buyers if egg prices remain static.
â€œFarmers have been struggling for some time to absorb these increasing
production costs and keep prices as low as possible for consumers,â€ Mr Kellaway
â€œBut with margins virtually non-existent, egg farmers are now at breaking
point and will have little choice but to pass on these costs.â€
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