Electricity hike hits Armenian poultry manufacturers

The observed hike in the prices of electric power is expected to affect the poultry manufacturing industries of Armenia.

Sergey Stepanyan, the president of the Union of Poultry Breeders, says the higher tariffs have already caused an increase in the cost price of poultry meat and egg.

“Electric power and natural gas account for the major part of our biggest expenses,” the manufacturer told Tert.am, expressing concerns that many companies may close down due to the damaged caused.

Asked whether the observed trend may cause a hike in the prices of eggs, Stepanyan said he doesn’t think that an abuse of monopolistic positions is a problem in their sector. He stressed the importance of ensuring equal conditions for all companies, including those considered monopolies. “Gazprom, the Electric Networks of Armenia and the South Caucasus Railways are all monopolistic, so they change their prices any time they want. But it is unacceptable in business,” he added.

Stepanyan said further that their company manages to fully meet the domestic market demand. “All [manufacturers] have enough livestock to prevent a shortage until January 1. And the livestock of our laying hen too, is sufficient enough to meet the market demand ahead and during the [Christmas] holidays,” he added.

Commenting on the problem, Director of Nubarashen Poultry Gagik Makaryan agreed that the higher prices of power will affect the cost price of the domestic products.

He said that their company, which now engages only in the manufacturing of poultry meat, works with damages without gaining profit.

“Meat manufacturing is energy consuming, and that will naturally have its effect,” he said, adding that an expected 2% increase in the cost price of meat is not likely to change the prices on the market.

Addressing the possibilities of import, Makaryan said, “The need for exports was felt and will be felt in the coming seven years, as the domestic manufacturers manage to secure only 25-30 percent of the market [demand]; all the rest are imports. The domestic product is always preferable, as we all know it is better and fresher. And what we import from abroad is just frozen meat which nobody knows how long was kept,” added the manufacturer.