Saudi- Egg producers face subsidy cut threat

(MENAFN- Arab News) The Ministry of Finance may cut the financial assistance it provides to producers of eggs after some had exported eggs for enhanced financial gain. The unjustified exporting of part of the production led to an increase in price in local markets. The Kingdom offers subsidies to egg producers to put a price cap on the product, as well as other regulations that include encouraging investments in the industry and increasing egg imports. The Preparatory Committee of the ministerial supply committee adopted the decision to restore the financial incentive at SR2,195 a ton if the producer chose to export his production. Saudi markets recently witnessed a raise in the price of eggs of 15 percent. A carton of eggs now cost SR17 as a result of the high demand. The Saudi Council of Chambers will inform egg producers of the recent decisions of the Ministry of Finance so they can decide whether to sell in local markets and obtain the financial assistance, or export their production aboard. Mahmoud Abdul Rahman Fakieh, chief executive officer of Fakieh Poultry Farms, a major producer and exporter of poultry and eggs in the Kingdom, said that the company has no intention of raising the price of a plate of eggs, nor do they have plans to do so in the future. He told Arab News that his company did not raise the price of a plate of eggs, as other companies competing in the market had done, raising the price to SR17 per dish. Fakieh Poultry farms have priced the plate of eggs produced on their farms at SR12 per dish. The price will be constant throughout the year. Fakieh also said the reasonbehind the high price of eggs by other producers of poultry, is to exploit the upcoming school season, as demand and consumption of eggs by students rises to 100 percent. He said that the company also has no intention to export eggs outside the Kingdom for profit, and they give first priority to the distribution of eggs in the local market. He pointed out that the domestic market has a surplus in the production of eggs covering the Kingdom, which has increased by 110 percent at the level of all egg producers, adding that the Fakieh poultry farms produce a total of 30 percent of egg production Kingdom wide, and that schools consumed half a million eggs a day during school year. He also said that Fakieh poultry farms aims at raising its production capacity to 3 million eggs per day during the next five years.