KEY POINTS:
Egg prices are set to rise on the back of soaring worldwide grain prices.
The cost of producing a dozen eggs has shot up by 40c - around 20 per cent - because grain prices have risen $100/tonne over the past few weeks.
"Egg farmers exist on slender
profit margins and unfortunately cannot continue to insulate consumers from the effects of this massive increase in grain prices any longer," said national marketing body Eggs Incorporated chairman Dennis O'Meara.
Another major egg producer and chairman of Independent Eggs Producers, Ron Turk, said more wheat, corn and other grains were being sought by food manufacturers at the same time land was being diverted to biofuel crops, and droughts were affecting graingrowers in places such as Australia.
Wheat has doubled in value on the world market since April, reaching US$9.1125 ($12.96) a bushel on United States commodity markets.
"We are experiencing a worldwide grain shortage where levels are the lowest they have been since World War 2," said Mr Turk.
"It is not just egg producers who will be forced to put their prices up," he added.
"Milk, pork and meat producers will also be hard hit due to the high dependence on grain for the production of these foods."
New Zealand's Pork Industry Board has also warned that rising barley and maize prices were becoming too steep for pig farmers .
According to a board director, Colin Kay, who farms 900 sows in the Manawatu, feed costs make up around 70 per cent of pork production costs.
"We are going to have to see the schedule payments to producers rise to account for the extra costs and that will mean that retail prices for pork and pork products will have to rise."
Hamish Sutherland, general manager of the nation's biggest egg producer, Mainland Poultry Ltd, said NZ companies buying feed grains were having to compete on the global market.
"The escalating world prices are being driven up further by demand for biofuels," he said. "It would appear that the world prefers to feed cars rather than people."
- NZPA
