raise the price of eggs and push those of other products in the basic basket

The Mexican economy has been affected by the sustained increase in the prices of basic basket products. Among them, the increase in the price of eggs stands out, a fundamental food in the diet of Mexicans. According to the national consumer price index (INPC), the average price of eggs has increased significantly in recent months, surpassing other basic products such as corn and beans.

This rise has generated concern among consumers, since it affects not only the pocket, but also access to adequate and balanced food. In this context, it is essential to analyze the causes of the increase in the price of eggs and their impact on the economy and the diet of the Mexican population.

Frequent and essential on Mexican tables

Mexico is one of the world’s main consumers of this product: about 345 eggs per person per year, which is equivalent to almost one egg per day. However, the increase in their prices generates a situation of vulnerability in the population, especially in low-income households.

This increase has been caused by internal and external factors, such as variations in supply and demand, the increase in production costs, the exchange rate and other circumstances that directly affect the Mexican poultry industry.

It is also important to keep in mind that prices vary depending on the region and the season. If we do an analysis, we can mention some of the variables that influence prices:

• Production costs: this includes feeding and maintenance of the birds, medicines, electricity and water, among others. The increase in the prices of these inputs can increase the production cost of the eggs. In addition, at the beginning of 2023 the wages of workers in this industry increased and also the prices of energy, something that influences its distribution in the market.

• Demand: it may be due to factors such as consumer preferences or seasonality in production. Seasonality affects the consumption cycle because, physiologically, in winter the caloric and protein requirement is higher than in summer. Historically, egg protein is used for food supplements and is the basis of the diets of many who are trying to change their habits at the beginning of 2023.

• Weather conditions: they can influence the price because the weather affects the production of bird feed. In addition, droughts or low temperatures affect the health of the birds and, therefore, the performance of egg production.

• The threat of bird flu: This has had a significant impact on egg production in the Jalisco Highlands (a leading area in this field) and in other regions of Mexico. Bird flu is a highly contagious viral disease that affects birds, including laying hens. The threat of this disease causes concern and forced poultry farmers to implement new sanitary biosecurity measures and, as a last resort, to slaughter chickens at the end of 2022 and beginning of 2023, the impact of which was related to the decrease in production efficiency. . According to figures from the National Agrifood Health, Safety and Quality Service (Senasica) and the National Poultry Farmers Union (UNA), to deal with the outbreak, in 2022 they were slaughtered, only in Jalisco, which is the leading producer nationwide. , 360 thousand chickens.

a temporary rise

When the price of eggs rises, other products in the basic Mexican basket that are produced from that ingredient are directly affected, such as flour tortillas, cakes and breads. In addition, some consumers replace them with other cheaper foods (tortilla, milk, beans). Also products that are made with eggs are replaced by cheaper options.

This variation in the prices of substitute products exacerbates the economic and food precariousness of less favored families. It is a kind of Domino effect in the configuration of the Mexican diet.

The price crisis has a negative impact on the intake of protein and other essential nutrients. This can be of particular concern for those groups that rely on eggs as a major source of protein, such as children, the elderly, and people on low incomes.

price rebalancing

The good news is that this price increase is temporary since agricultural and livestock products are more susceptible to three variables: proximity to the product, useful life, and consumer preferences.

Shorter distances to travel in its distribution, expiration (which prevents its prolonged storage) and the tendency of consumers to seek better prices will end up causing a rebalancing in the prices of Mexican eggs.

María de Jesús De la Mora, International Business, University of Guadalajara

This article was originally published on The Conversation. Read the original.