Soaring chicken prices — time to opt for other protein sources
By:Noor Syahhira Hady
Date:
KCH-goods-2508-nsh-3

CHICKEN and eggs are among the basic items used in various dishes everywhere – either on their or in combination with other ingredients they are popular. We all love dishes that include both chicken and eggs, like chicken fried rice with eggs, chicken and egg palo rice, and chicken salad with an egg dressing.

For Malaysians, having either one or both is a must in their home cooking.

However, the war between Ukraine and Russia has pushed corn and soybean meal – two of the most common feed ingredients in animal feeds – prices up by 50 per cent between April and June.

Federation of Livestock Farmers Associations of Malaysia deputy president Lee Yoon Yeau said grain corn and soybean meal are crucial as they make up over 80 per cent of chicken feed.

“Since the pandemic two years ago, farmers have been struggling due to the increasing feed cost.

“Grain corn used to cost RM800 per tonne before the pandemic. During COVID-19, it went up to RM1,300 per tonne. Now, it’s more than RM1,800 per tonne,” he lamented.

Chicken in the farm.

Soybean meal, on the other hand, now costs over RM2,650 per tonne, an increase by RM1,000 from RM1,650 per tonne in January 2020.

Poultry farmers have called for the ceiling price of chicken to be set at a minimum RM10.50 per kg, saying that the price was fair considering the high chicken feed prices.

Nevertheless, Deputy Agriculture and Food Industries Minister Datuk Seri Ahmad Hamzah said the new ceiling price of RM9.40 per kg is ‘sufficient’ for farmers.

“The new ceiling price is the right decision. This is because the supply of chicken nationwide is sufficient and stable,” he said.

For the record, on June 29, Agriculture and Food Industries Minister Datuk Seri Dr Ronald Kiandee said Putrajaya has agreed to cap the ceiling price for standard chicken at RM9.40 per kg in Peninsular Malaysia (starting from July 1 To Aug 31), a increase from the previously capped price of RM8.90 per kg for standard chicken.

In Sarawak on the other hand, the ceiling price has been fixed according to districts ranging from RM9.40 to RM12.90 per kg, while the ceiling price of grade A chicken eggs is fixed at 45 sen to 50 sen each, grade B (45 sen to 48 sen) and grade C (43 sen to 46 sen).

What do the experts say?

Professor Dr Anjas Asmara Samsudin

According to Professor Dr Anjas Asmara Samsudin, Deputy Dean of Development, Industry and Community Networks of the University of Putra Malaysia (UPM) Faculty of Agriculture, the issue of chicken and egg price hike is greatly influenced by the effect of the increase in the price of raw materials, such as imported grain corns – the basic ingredient in the manufacture of chicken feed.

“The steep increase has forced many industry players to temporarily stop operations and some even had to close shop.

“The situation is getting more challenging with the lack of workers in this sector, in addition to the rising price of chicken,” he said.

What compounds the problem is that Malaysians are the third highest consumer of chicken meat in the world after the United States (USA) and Israel.

“On average, a Malaysian consumes 50kg of chicken meat per year, in contrast to Indonesia which only consumes 9kg and Thailand as much as 8kg, the average consumption of chicken meat per citizen.

“In my opinion, one way to overcome the increase in the price of chicken and the instability of the chicken supply is to start changing our eating patterns little by little,” he said.

He added that it is undeniable that chicken is a cheap source of protein and is loved and preferred by all. But Malaysians have to start changing their diet by taking protein sources from plants such as tempeh, beans or even fish.

“So there is no need to eat chicken every day. By starting to change this eating pattern, say eating less chicken in a week could help us overcome this issue,” he said.

On the best mechanism to stabilise the price and supply of chicken and eggs in the Malaysian market, he said the announcement on the abolition of import permit (AP) for agricultural products, including chicken by Prime Minister Datuk Seri Ismail Sabri was quite an appropriate move.

Cartons of eggs in the retail store. Photo: Devan Manuel

“However, the approach is seen as only temporary and there needs to be a long-term strategy to ensure the survival of farmers and suppliers.

“There needs to be a mechanism that examines the needs to accommodate the inadequacies produced in the country. In the absence of this control mechanism, it will kill off small and medium industry players.

“Hence, the issue of chicken and egg supply uncertainty will continue to persist in the future if our food source dependence on overseas supplies continues.

“Looking at the issue of the Russia-Ukraine war today, the effects of supply uncertainty can be felt around the world even though not all raw materials are obtained from these two turbulent countries.

“Therefore, the country’s ability to produce its own food is very important in ensuring the our food security continues to be guaranteed,” he said.

Anjas said despite the fact that the issue of the chicken and eggs is also closely related to the cost of raw materials, there is a recommendation from a research carried out previously that the content of the grain corn can be reduced and substituted by palm kernel cake (PKC).

A worker unloads trays of eggs. Photo by Bernama

“From the results of the study, PKC can be used by as much as 20 per cent in chicken feed rations. However, it cannot be given too much as the high fibre content in PKC causes digestive problems in chickens.

“Corn, on the other hand, provides a source of energy for chickens. So if we can reduce the amount of corn in the chicken bran formulation and replace it with PKC, the dependence on corn sources can be reduced.

“Nevertheless, if we look at it now, the government has started to plant large-scale grain corn so that this local source can cover at least 30 per cent of the total amount we import,” he said.

All in all, looking at Malaysia’s food security in this period, he opined that the government needs to increase the national buffer stock, saying that although it will cause a relatively large investment in terms of ringgit, it should be seen that the return on this investment is in the form of domestic security.

“In addition, there is a need for a policy on the allocation of land for food farming activities permanently.

“We already know that land matters are the affairs of the state government.

“Nevertheless, there should be a mechanism from the federal government in providing incentives to states that allow large-scale food crop activities such as Kedah, where most of the land there is used to supply rice to Malaysians,” he said.

Businesses surviving despite the price hike

With the sharp rise in the price of chicken and eggs, many of the entrepreneurs whose businesses revolve around poultry and eggs see it as alarming and they are now in a dilemma.

Venturing into a business is never easy, especially when you have to keep the quality of the products and constantly attract customers while making a profit out of it.

Contemplating between pleasing the customers or increasing the price of the food that they are selling, some eateries choose to retain their prices despite the hike in ceiling price of chicken.

Anna’s chicken rice stall at Ang Hor Cafe.

Anna, 61, who operates a stall at Ang Hor Cafe, Ban Hock Road, said that despite the price hike, she would still retain selling various chicken rice dishes ranging from RM6 to RM8.

“I know that the price of chicken has increased, but I also worry about my customers. Despite the price increase of commodities everywhere, the minimum salary for the working class has not increased. If I choose to increase the price of my chicken rice, how can they afford it?

“Retaining the price would only cost me less profit, but on my part, I am fine with the minimal profit,” she said.

Ting’s chicken rice stall at Woon Lam Cafe 1999.

Meanwhile, Jonathan Ting, 35, who operates a stall at Woon Lam Cafe 1999, Song Thian Cheok Road, said that he too chose not to increase the price of his chicken rice.

According to him, he sells only one type of chicken rice dish for RM8. Due to this, he said, his profit would fully depend on the profit from every plate sold.

“However, I cannot increase the price of my chicken rice beyond the current price. I admit that not doing so would affect my business, but it is now up to the point whether I want to settle for a lesser profit or fewer customers.

“That is why, for me, the best choice is to choose less profit,” he said.

Although these eateries have decided not to increase their prices due to fear of losing customers, other food entrepreneurs have no problem increasing their prices.

Salleh owner of Hawa Catering

For Hawa Catering owner Salleh Kram, 54, increasing some of the prices of the dishes he sells is inevitable.

“Being in this business, we have to increase the price a little but not too much to the point that our customers would leave us.

“In return for the price increase and with us having a catering business and a BBQ steamboat business at the same time, we can still offer discounts and promotions on other things such as on our reception hall and offer more varieties in our steamboat business.

“With this, we are still able to attract and maintain our customers to choose and dine with us. For me, what is more important in the eatery business is the quality service that we provide. That is the secret weapon when you are in a business,” he said.

Awang Amir Azizul Rahman owner of Fabulous Burger

Awang Amir Azizul Rahman, 38, owner of Fabulous Burger, said the new ceiling price had made him readjust some of the burgers available in his stall.

“One of the burgers that we had to increase is the homemade crispy chicken. However, for other burgers that do not have egg or chicken, we still maintain their price.

“This is because even before we wentinto business, we calculated the price of everything and the profit that we can earn.

“For now, we are not on the losing side. Despite the prices of some of the burgers having increased a bit, our burgers are in great demand,” he said.

Crispy chicken burger

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