Bird flu outbreak threatens Russia's egg market

Photo: Collected

One of Russia’s largest egg producers, Volzhanin, has suspended shipments after one of its production sites reported an outbreak of bird flu. The incident can have a significant consequence for the market.

The Russian egg market may experience localised price hikes following the bird outbreak at Volzhanin, commented Alexander Shirov, director of the Institute of Economic Forecasting of the Russian Academy of Sciences.

Based in the Yaroslavl region, Volzhanin is believed to account for roughly 20% of egg production in the European part of Russia.

Under the existing Russian veterinary regulations, quarantine measures at the Volzhanin farms can take up to six months, during which production may be partially disrupted, according to Russian news outlet NSN.

A serious blow

The outbreak is a “serious epidemiological blow” that will drive up prices, Shirov stated. “Many producers will be happy to replace Volzhanin by offering their products,” Shirov said, assuming that competition on the egg market will help keep prices at bay.

In response to media reports warning of an upcoming price hike in the Russian egg market, the Federal Antimonopoly Service has issued a warning to egg manufacturers, reminding them that unjustified price increases are unacceptable and that they must comply with antitrust regulations.

A low season

The timing of the outbreak will make a big difference for the price situation, noted Alexander Afinogenov, independent market analyst. January in Russia is traditionally a period of low demand due to extended New Year holidays, so the absence of Volzhanin products will be barely noticeable, Afinogenov stated.

In the future, much will depend on the Volzhanin’s management, Afinogenov said, adding that the right strategy can allow the company to restore operations within a month.

Source: Online