Lately I’ve been thinking a lot about the golden eggs laid by a certain goose, the one that Jack nipped from the Giant in the Beanstalk story. Losing his precious goose greatly upset the poor Giant, but I’m guessing if he were still around today he’d be truly devastated. You see, the wholesale price of eggs quoted to us by our suppliers has gone up about 60% from a month ago, and looks set to continue climbing as high as Jack ascending his beanstalk.
Granted, Jack’s were goose eggs while I’m writing about normal, everyday chicken eggs. But the latter are an any-meal-of-the-day staple for many, and in some countries they’re a price-controlled item during celebrative seasons to ensure everyone can afford them despite heightened seasonal demand.
So for a food item that we usually take for granted to now cost so much more than it did just a month back, that should warrant a relook at these spheres of golden-yolked yummyness. Afterall we’re talking about eggs, not gold ingots. The rate at which egg prices have increased has outpaced that of gold. Deeper checking out was needed.
A fundamental economic principle is that of scarcity. Put simply, it’s the constant tug-of-war between supply and demand, the outcome of which is whether the price of an item goes up or down.
Currently, eggs produced domestically satisfy only 20-25% of consumption demand. Malaysia remains Singapore’s main source for eggs, and around four million eggs are sent across the causeway to us everyday. Last year, a few Malaysian egg farms were suspended from exporting to Singapore due to concerns over Salmonella enteritidis, a bacteria that causes food poisoning. While the daily supply from Malaysia dropped, hunger for eggs remained the same, thus – Scarcity, immediately followed by big price increases. Other contributors were the higher costs of wages, fuel and toll charges. That explains last year.
This time round it seems a little more “man made”. According to one of our suppliers, consumers in Hong Kong and China are now willing to pay a premium for Malaysia’s eggs, and the farms are likewise willing to sell to them. So much so that after committing to orders from the Chinese territories, Malaysian farms are now working overtime to meet their own country’s demand. Supply to Singapore still flows, but in lesser quantities than before – Scarcity. But now it looks like another factor’s in play: we’re facing stiff competition in the egg-buying scene.
As things would have it, on a recent trip I made a new friend who runs his own chicken egg farm. We had in-depth conversations where he explained egg production and various related issues to me, all of which I found fascinating.
It starts with buying day-old chicks by the tens of thousands. For the next four months, the chicks do nothing but eat and grow. The quality of the eggs depends mainly on the concoction of the feed, and that’s the expensive stuff. On my friend’s farm, feed alone costs about $200,000 a day. No eggs yet from the young birds, mind you.
His chickens are at their egg-laying peak when they’re between six to nine months old. At that time, his chicken houses – each containing anywhere from 60,000 to 90,000 chickens – are at their prime production rate of 90-95% harvest of eggs. On average his farm produces around a million eggs a day, both the regular brown-shelled and the highly sought-after white-shelled “kampung” ones. Almost all the eggs his farm produces are already pre-booked by buyers from all over the country, as well as an “inner circle egg club” of close friends.
My new friend tells me with the pride of a father watching his toddler take those first few unaided steps, for him the ultimate gauge of the quality of his eggs are his friends’ children who will only eat the eggs from “uncle’s farm” (Asians refer to our elders as “uncles” or “aunties”, even when unrelated, as a show of respect. The children of his friends will call my friend “uncle”). It’s all in his own secret concoction of chicken feed, the ingredients of which come from all over, he confides. This sort of thing impresses me.
When the chickens reach 10 to 12 months old, egg production drops drastically and it’s time for the older birds to be processed for meat. Nothing is wasted, even the tons of chicken poop are collected by mechanised conveyor belt systems to be used as fertiliser for vegetable farms. This keeps the chicken houses clean and hygienic.
My friend’s chicken houses are huge, automated closed-systems that maintain the highest health and hygiene standards. I just had to ask: what was the worst disaster he’s encountered. It was a power failure to one of the houses due to a lightning storm in the wee hours. This happened years ago. Temperature control and ventilation were temporarily knocked out, and he was left with $500,000 worth of dead birds on his hands, not to mention clean-up and replacement costs. I started to understand what risky business egg farming really is.
And I started to reflect, with new found appreciation, on the massive amount of eggs that we supply our clients each year.
Take an average cruise ship with 4,000 passengers and crew on board a 7-day cruise. If everyone had two eggs for breakfast, that’s 8,000 eggs cooked each morning, or about 50,000 eggs for the duration of the cruise give or take a breakfast. Add to that the eggs used in all the other free-flow meals, cakes and various desserts during the cruise. You’d have to be impressed by the number of eggs consumed.
Sofresh serves a good number of cruise ships, and they’re each typically scheduled to call at Singapore multiple times throughout the season to take on fresh supplies. Every ship needs plenty of eggs. Add to these numbers orders from our oil and gas, commercial vessels and offshore catering clients – the amount of eggs that we supply each year is staggering even to my imagination!
The bottom line is this: We love our eggs. We need eggs. But the current trend of increasing egg prices, if unabated, is worrying. If it doesn’t trend back down soon, I’ll have to figure out a way to join that “inner circle egg club” at my new friend’s farm to get my hands on those quality “kampung” eggs. I’m already paying a good price anyway. In this chicken and egg story, we don’t know where or when the “cluck” stops, but we’re hoping that it does soon.
In the meantime here at Sofresh, we’ll continue trying our best to keep the supply of eggs flowing undisrupted to our clients, and at the lowest possible prices. We know our clients in turn have thousands of passengers whom they must satisfy. Because ultimately, nothing must be allowed to spoil the fun and wonderful experience of sailing.