Which geography is this for? SKM doesnât export to the US.
Anyone with the understanding of this company and industry can help how should we read last 5 qtrs of subdued results? Not only the sales has come down, but the knock on operating margins is much higher. Following reasons:
- Lower prices of finished goods with stable volumes?
- Stable prices with lower volumes?
- A combination of above 2 options?
Similarly on operating margins side:
- Lower finished goods prices with higher raw material prices?
- Any other combination?
Russia / Japan and Europe are the top 3 places where they were exporting. Bird flu is a seasonal factor and happens every year. Is there anything specific / special that has impacted this company adversely this time? Best of my understanding, egg prices in US are up by ~50% in last 12 months. Donât know how this is playing in SKMs exporting territories, but the probability of anything substantially different should be low.
There is little available in the public domain to develop better understanding. Any industry / domain expert can help.
Thanks
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Egg prices globally in most countries have sky rocketted to lifetime high levels. Especially USA and Japan.
The incidence of bird flu has been severe in both these countries as comoared to last year especially in the birds that are bred to lay eggs⌠called layers.
To replenish the layer stock should take 6 to 9 months which means high egg prices for next 2 to 3 quarters with a hope that there is a milder incidence of bird flu next season.
The negatives of the egg price spike 2 years back was that many formulations were moved to plant based substitutes which subsequently led to higher global inventory levels esp in albumen.
As dried egg powder inventories get run down better pricing will follow for subsequent contracts. My sense is that prices of dried egg powder will see a meaningful increase from 1QFY26.
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