🇮🇷 Iran’s Egg Industry on the Brink of Bankruptcy: Causes, Consequences, and the Way Forward
Iran’s poultry industry has long been one of the backbones of the country’s agricultural economy, supplying affordable protein in the form of eggs to millions of households. However, since the start of the Persian calendar year on March 20, 2025, Iran’s egg sector has been facing unprecedented financial and operational challenges. Poultry farmers have suffered a net loss of more than 20 trillion tomans (≈ US$48 million), and experts warn that if urgent government measures are not taken, the industry could collapse entirely.
The crisis stems from a mix of rising production costs, chronic feed shortages, and state-controlled pricing systems that are no longer sustainable. This article takes a deep dive into the economic realities of Iran’s egg industry, the root causes of the crisis, its ripple effects on farmers and consumers, and the possible solutions that could prevent a total collapse.
📊 The Current State of Iran’s Egg Industry
Iran is among the leading producers of eggs in the Middle East, generating 3,500–3,600 tonnes per day on average. Eggs are not only an affordable protein source for local households but also a vital part of Iran’s agricultural economy, creating employment and supporting rural livelihoods.
Yet, despite such massive production volumes, poultry farmers are reporting catastrophic losses. According to Hamid Reza Kashani, chairman of the Mihan Poultry Farmers’ Union, the farmgate egg prices range between 30,000 and 35,000 tomans per kg, which is about 45,000 tomans lower than the actual production costs. This mismatch has driven profitability to minus 20%, making it nearly impossible for farmers to continue operations.
💸 Why Are Poultry Farmers Losing Money?
The financial collapse is not due to lack of production but rather the widening gap between costs and farmgate prices.
1. Rising Production Costs
Feed, energy, labor, veterinary supplies, and transportation costs have all increased sharply in recent years. Farmers are now paying twice the price for feedstuff on the open market compared to government-subsidized rates, but the limited supply in state channels forces them to rely on expensive private markets.
2. State-Regulated Pricing System
The government sets egg prices through a regulated system, keeping consumer costs low but preventing farmers from covering their expenses. This system was designed to ensure food security, but it has now become a major burden on farmers.
3. Feed Shortages
The biggest contributor to the crisis is the shortage of key feed ingredients such as corn, rapeseed, and sunflower meal. Without affordable feed, production costs skyrocket, and hens produce fewer and lower-quality eggs, compounding the problem.
🌾 The Feedstuff Crisis in Detail
Iran’s poultry industry depends heavily on imported feed grains. The Agricultural Ministry operates a state-controlled distribution system where feed ingredients are sold at subsidized prices to farmers. However, chronic shortages and bureaucratic inefficiencies mean that the system cannot meet demand.
Farmers are often forced to turn to private traders, where feed costs are almost double. For small-scale farmers, this imbalance is devastating, and many have already shut down their operations.
Feed makes up nearly 70% of egg production costs, meaning that any disruption in feed availability directly threatens the survival of poultry farms.
🛑 Consequences of the Crisis
The ongoing egg industry crisis in Iran has severe implications not just for farmers but for the entire food security chain.
For Farmers
- Mounting debt and inability to pay workers.
- Increasing bankruptcy risk.
- Forced culling of flocks when feed is unaffordable.
For Consumers
- Short-term egg price stability (due to government price control).
- Long-term shortages if farms close down.
- Higher reliance on imports, leading to price shocks.
For the Economy
- Collapse of small- and medium-scale poultry farms.
- Rising unemployment in rural areas.
- Increased burden on the government to subsidize imports or purchase surplus.
🥚 The Role of Government Purchases
In an attempt to stabilize the market, authorities have been purchasing surplus eggs from farmers for state reserves. Kashani and other industry leaders argue that the government must purchase at least 50,000 tonnes of eggs immediately at a guaranteed price of 74,500 tomans per kg to keep farms afloat.
While this provides temporary relief, it is not a sustainable solution. Without long-term reforms in feed distribution and pricing policies, such interventions will only delay the inevitable collapse.
📉 How Iran’s Egg Industry Compares Globally
To understand the scale of Iran’s crisis, it helps to compare its industry to other countries.
- United States: Farmers operate in a free-market system, with egg prices fluctuating based on supply and demand. Feed is expensive but widely available.
- India: Uses hybrid models with government support in certain regions, but farmers have more flexibility in pricing.
- Turkey: Similar challenges with feed imports but better export opportunities keep the industry profitable.
- China: The largest egg producer globally, with highly efficient systems that balance subsidies and market pricing.
Iran’s challenge is that it has the cost structure of a free market but the pricing control of a command economy, creating an unsustainable contradiction.
🧪 Long-Term Risks if No Action Is Taken
If authorities fail to act urgently, several long-term consequences are expected:
- Mass Farm Closures: Thousands of farmers could exit the industry within a year.
- Protein Shortages: Eggs are the cheapest protein source in Iran; shortages would increase malnutrition risks.
- Import Dependency: Iran may be forced to import eggs, spending valuable foreign reserves.
- Black Market Growth: Farmers may sell eggs unofficially at higher prices, destabilizing the formal market.
🛠️ Solutions and Recommendations
Experts suggest several measures to rescue the industry:
Reform Feed Distribution
Instead of a centralized system plagued with shortages, Iran could allow private importers with government oversight to ensure availability while preventing extreme price hikes.
Guarantee Purchase Prices
Farmers need assurance that eggs will be purchased at or above production costs. Guaranteed pricing at 74,500 tomans per kg could stabilize profitability.
Support Small Farmers
Microcredit loans, tax breaks, and subsidies could help small-scale poultry keepers survive the crisis.
Encourage Exports
Iran produces a surplus of eggs at times. Developing export markets to neighboring countries could provide an alternative revenue stream.
🌍 Case Studies of Recovery in Other Nations
Other countries have faced similar crises and recovered:
- Egypt implemented feed subsidy reforms and promoted small-scale farms, stabilizing egg production.
- Brazil encouraged domestic corn production for poultry feed, reducing dependency on imports.
- Vietnam shifted towards cooperative poultry models, lowering costs for small farmers.
Iran could adapt elements from these models to strengthen its poultry sector.
📈 The Road Ahead
For Iran’s egg industry, the road ahead depends entirely on government action. The crisis is solvable but requires urgent, structural reforms rather than temporary bailouts. Poultry farmers are resilient, but without affordable feed and fair pricing, even the strongest farms will collapse.
🏁 Conclusion
Iran’s egg industry is at a turning point. With daily production of 3,500–3,600 tonnes, the sector has immense potential, but mounting losses of 20 trillion tomans have pushed farmers to the edge of bankruptcy. The combination of feed shortages, unsustainable pricing, and lack of government support has created a perfect storm.
Without urgent reforms, Iran risks losing one of its most vital food sectors. The solution lies in securing affordable feed, guaranteeing fair farmgate prices, supporting small farmers, and building stronger export channels. If implemented, these measures could not only save Iran’s egg industry from collapse but also make it more resilient and competitive in the future.