As meat prices continue to rise, making it unaffordable for many people, Ahmed Abu Ghazala tries to find the truth behind the crisis At a butcher's shop in Nasr City, Abdel-Moneim, a man in his 20s who did not want to give his last name, asked for half a kilo of veal. Mahrous, the butcher, explained that he no longer sold this kind of meat as it has become too expensive. Although Abdel-Moneim is aware of the soaring prices of veal, he doesn't know what has caused them. "I'm thinking of buying a calf myself instead," he said. An older woman asks Mahrous for a kilo of beef, but the LE54 price tag startles her, since it has increased by LE4 since last month alone. "I can't afford that kind of increase, as I have other things to pay," she said. "The only solution is not to buy meat, as the press has been telling us." However, the butcher doesn't seem to mind. He believes that a boycott will lower prices, since he has to pay expensive prices for his meat as well. "I used to buy a kilo of beef for LE30, but now it costs LE36, including bone and fat that is disposed of and not sold. The public doesn't understand that we have to pay higher prices as well," he explained. His assistants said that they had stopped selling veal when the price went over LE43 a kilo at the wholesalers, reaching the public at LE84 three weeks ago. Now that veal has gone up by another LE5, it can cost LE90 for the public. Mahrous said that he no longer sells veal, and he hopes consumers won't want to buy it. Over the past three years, meat prices have been increasing by LE2-3 every now and then, especially during feasts or on occasions when people tend to eat more meat. However, a LE15 increase in one month in veal prices was too much for people to bear, though the fact that demand has now increased for other types of meat has meant that these prices have jumped by LE4-6 as well. Prices of meat are high throughout the country regardless of the governorate or an area's social mix. Even in districts like Masr wal-Sudan Street, veal is sold for LE73 with fat. If a customer wants lean veal, this will cost LE80 or more. Locally produced meat covers nearly 60 per cent of national consumption, with the rest being imported from countries like Australia, Brazil, India, Ethiopia, Sudan and others. Last February, the government announced that it was importing more meat, including 2,400 tons of frozen meat, 10,000 calves from Ethiopia and 20,000 more from Australia. However, in March opposition newspapers launched a campaign against this imported meat, alleging that 21 shipments of Indian meat had been contaminated by parasites. MP Saad Khalifa then raised the issue in the People's Assembly, calling on Amin Abaza, the minister of agriculture and land reclamation, to reply. According to press reports, the Veterinary Quarantine Agency had refused the Indian shipments because they were infected by parasites. However, the agency had then broken the law by examining other samples in order possibly to allow these to enter the Egyptian market, instead of ordering that the entire shipment be dumped. However, Azza Ramadan, director of the Cairo Veterinary Medicine Directorate (CVMD) at the Ministry of Agriculture and Land Reclamation, has a different story and told Al-Ahram Weekly that although the parasites in question, known as sarcocyst worms, can live in many kinds of meat, they are easily killed by freezing or cooking. Ramadan said that frozen meat was strictly inspected by three official bodies, the General Organisation for Export and Import Control, the Ministry of Health, and the veterinary authorities. She added that these bodies had conducted thorough inspection campaigns and had never found the parasites in Indian meat. "We haven't heard any complaints of people buying infected meat, which leads us to believe that this is a war between some big players," and not a health problem at all. In earlier statements, Minister Abaza said that local meat producers benefited from such rumours, which emerge whenever large shipments of meat are imported. Imported meat was 100 per cent safe, he said, warning that rumours about its contamination would lead to a shortage of meat and would send meat prices sky-high to LE200 a kilo. He called on people to buy poultry or fish instead. However, despite such statements, meat prices skyrocketed after the press reports about the Indian meat, and they have not fallen since. Many theories have been put forward to explain the shortage of local meat. An increase in the price of animal fodder is one main reason why the crisis has escalated, according to the owner of the Gezaret Al-Amana butcher's shop at Souq Al-Attaba in Cairo. At the Attaba market there is a huge area selling meat, and the butchers there have their own version of the crisis. The owner of the Gezaret Al-Amana shop, who is both a retail and wholesale butcher, said that he had stopped dealing in veal over the past three weeks because of its price. Fodder prices had increased dramatically a year and a half ago, he said, causing farmers to slaughter more calves and cows to circumvent the high prices of feeding their cattle. "As livestock numbers decreased, the farmers increased their prices, a situation that has affected the local meat supply," he said. It is true that prices of fodder did increase a year and a half ago, due to the global financial crisis and the increasing amounts of land being used for crops to produce ethanol for fuel. Mohamed, the owner of the Gezaret Al-Madina butcher's shop in Nasr City, northeast Cairo, is also a retail and wholesale butcher, but he says that fodder prices alone cannot explain the crisis since prices have been steady recently. "All I can say is that this increase comes from the farmers themselves, and not from the butchers." According to Mohamed, a calf costing LE700 and giving 50kg of meat now costs LE2,000-3,000, which means that retailers pay LE47 a kilogramme at least. A cow cost LE17-19 per kilogramme before the crisis, but costs LE23 nowadays. "This price forces wholesalers to increase prices to LE36 when selling to retailers just to cover the costs of shipment, workers' wages, abattoir fees, and to get a small profit margin." Nabih Abdel-Fattah, a butcher at Awlad Ragab supermarket, told the Weekly that some farmers slaughter calves because they cannot afford to raise them. Only farmers that have money and don't suffer from economic problems can afford to wait and raise their cattle. For her part, Azza Ramadan from the CVMD said that the main reason behind the veal crisis was the fact that too many cows had been slaughtered, meaning that there was a shortage of animals to reproduce. "Last Adha feast (when Muslims celebrate the Prophet Ismail's sacrifice by eating and donating meat), a quarter of a million animals were slaughtered, three quarters of them females," she said, adding that much of the slaughter took place outside abattoirs because slaughtering female animals less than five years old is a felony possibly leading to a fine and imprisonment. Yet, there is more to the story than just slaughtering calves, as smuggling appears to be a problem as well, as Mohamed Al-Rakeeb, one of the biggest sheep and veal wholesalers, told the Weekly. "Sheep and calves are being smuggled to Palestine on a massive scale in a phenomenon that has increased since the last feast," he said. "Breeders take LE30-32 per kilogramme for a calf and LE27 for a sheep and prefer to see them smuggled rather than sell the calf for LE22 per kilogramme and the sheep for LE23.5 on the Egyptian market." Al-Rakeeb said that prices for calves had reached almost LE1,500 after the Adha feast and up to LE3,000 today. "This crisis is reminiscent of how the government mismanages any sector. We had livestock, but we let people smuggle it and slaughter the females until we have almost destroyed it. And here we are searching for alternatives, such as importation, to solve the problem." Don't even think about seeing any reduction in prices as long as these things continue, he said. Mamdouh Mohamed, director of the Al-Basateen abattoir, told the Weekly that the number of calves slaughtered there had decreased dramatically over the past three months, from 6,800 in January to 5,900 in March. "The number of calves slaughtered is usually never lower than 10,000, and since winter is the season for veal in the past the number of slaughtered calves was never less than 13,000," he said. Mohamed suggested that another reason for the current crisis could be the prohibition on slaughtering pigs because of swine flu. Some 5,000-6,000 pigs used to be slaughtered every month at the abattoir. "Demand for pigs has been converted into demand for veal and beef, causing more damage to our livestock." As the experts discussed the reasons behind the problem, it appeared that importing meat was one way of solving the meat crisis, though this could lead to additional problems for the consumer. Al-Rakeeb said that importing meat was a bad idea, since "we import the worst types of meat. Egypt imported cattle from Sudan infected by foot-and-mouth disease a few years ago, which destroyed a lot of our livestock. I had cattle and sheep at the time, and I had to get rid of all of them." This was corroborated by the minister's statement last Friday, in which he said that one of the main reasons for Egypt's current meat crisis was the loss of 25-35 per cent of livestock due to infected imported animals. However, Ramadan, the director of the CVMD, nevertheless argues that imported meat is healthy and hygienic. "All the five-star hotels and restaurants use imported meat," she said. "These statements are just prejudice." According to Mohamed of the Gezaret Al-Madina butcher's shop, there has been a lot of imported meat on the market, but this has not led to a decrease in local meat prices. For Emad Al-Hagar, director of the veterinary affairs directorate at the Al-Basateen abattoir, the solution lies in government action to inspect the industry better, particularly in stamping out illicit sales of meat meant for the subsidised market to supermarkets. "Huge amounts of meat are sold for LE50-60 at butcher's shops and supermarkets instead of at subsidised prices of LE28," he said. Al-Hagar said that the imported meat slaughtered in Egypt's abattoirs was in good condition, and a lot of low-income people asked for it. "It is sold for LE28 in Mansheyet Nasser, and there is a huge demand for it," he added. Last Friday, press reports indicated that the governorates of Gharbiya, Assiut, Suez and Al-Wadi Al-Gadid had lowered local beef prices from LE50 to LE48, following the introduction of huge quantities of imported meat at between LE29 and LE35. Meanwhile, the government is increasing sales of imported meat in order to reduce prices elsewhere. Al-Ahram announced last week that 5,000 calves were now being imported from Ethiopia monthly, and Fayza Abul-Naga, the minister of state for international cooperation, has also announced that the government intends to increase the number to 10,000. Some 2,000 calves had already arrived at the Safaga abattoir, she said, and these would be sold to the public at LE30-32 per kilogramme. Yet, even imported meat prices have increased recently. According to Umm Mohamed, who was buying meat at the Awlad Ragab supermarket, the problem is getting bigger by the day. "We are a low-income family," she said. "While local meat is much better, we can't afford to buy it. A kilogramme of Brazilian mince was LE16, but now it is LE25. Liver was LE7-8, and now it is LE13. I don't know what we are going to do if this continues." Nader Sweilam, a meat importer, told Al-Ahram last week that a tonne of Brazilian beef cost $3,000 last year and $3,700 today. Controlling prices through government intervention has been one solution discussed in the press, though this would be difficult since the government is committed to price liberalisation. Nevertheless, the governor of Aswan, Mustafa El-Sayed, intervened in the market to fix beef prices at LE34 in the governorate and prohibit the transport of cattle, either alive or slaughtered, outside it. In the longer term, another solution might be to revive the 1982 veal project that aimed to support breeders by giving them small loans to raise cattle at interest rates of six per cent. The Ministry of Agriculture and the Principal Bank for Development and Agricultural Credit (PBDAC) then bought the cattle, called in the loans, and gave the breeders their profits. The government then sold the meat in official outlets to the public at reduced prices. The project ended in 1990 on grounds of cost, though a more limited version of it continues to exist thanks to an American loan. According to Youssef Mamdouh, advisor on veterinary services at the Ministry of Agriculture, this project should be looked at again in the light of today's problems. "Would the government provide the loans this time round, or would a third party? Would breeders use the loans properly or not," he asked. Mamdouh added that the private sector should be encouraged to enter the field. "Companies should buy cattle and raise them. The problem is that all the businessmen in the country are investing in constructing tourist villages when they should be thinking about entering the field of nutrition." "I want to say to businessmen: have mercy on Egypt and Egyptians. Think about developing the country and invest a small amount of your money in breeding and raising cattle to develop our livestock," he said. Along with other wholesalers, Al-Rakeeb assured the Weekly that the kind of poor villagers who once used to own three or four cattle now no longer exist. Large concerns control the industry today, they said, along with meat prices. While the media has been calling for a revival of the veal project as a possible solution, it appears that something like it has been taking place on the ground for several months. In August 2009, Abaza apparently decided to revive the project, and Ali Shaker, chairman of the board of directors of the PBDAC, allocated LE100 million to help breeders fatten calves to 450kg in the form of loans at seven per cent interest. In December 2009, Shaker stated that the agricultural banks were ready to help breeders join the project and encouraged farmers to take part. Furthermore, two weeks ago Abaza announced procedures for increasing loans to LE2,000, instead of LE1,500, for cows and buffaloes less than 250kg, and to LE3,000, instead of LE2,500, for those above 250kg, in order to encourage breeders to invest in the meat industry and thereby help lower escalating prices. However, the revived veal project could in itself be a factor in the current crisis. Ismail, 61, a retail butcher, has been working in meat for 50 years, having inherited the trade from his father. At his shop in Doqqi, he has his own explanation for the crisis. "This crisis has occurred because the government decided to revive the veal project to encourage breeders to raise their calves instead of slaughtering them, as the livestock of the country had drastically decreased. They told the farmers, 'instead of slaughtering calves for LE2,000, we will give you the same amount of money to raise them and buy them from you later. That way, you get more money.'" This incentive had made breeders stop slaughtering calves, which had led to a decreasing supply of veal. "Only three or four calves now come from each village, instead of the 500 to 600 that was the case before." This situation had led to an increase in demand for beef, causing it to increase in price as well and leading to today's generalised crisis, he said. Al-Rakeeb told the Weekly that the PBDAC had offered loans to breeders, and that many of them now kept their calves to fatten them. "I was offered a loan, but I didn't accept it because I found that I would have to pay 14 percent interest on it, what with administrative expenses and other things." However, Al-Rakeeb said that the loans could be useful for breeders with large farms who could pay the interest while securing their profit margins. Questions are now being raised about the government's management of the crisis. Although reviving the veal project looked promising in the long term, it caused a huge problem in the short-term, especially since the policy of meeting short- term problems through increased imports has failed because of business conflicts. Another question raised by the crisis is how the media could help to manage similar problems in the future. However, neither question is easy to answer, since officials seem to have different information about the crisis. Both Ramadan, director of the CVMD, and Mamdouh, advisor on veterinary services at the Ministry of Agriculture, apparently did not know that the veal project had been revived. Instead, they both denied it, asserting that it would be a good solution to the crisis if it were properly applied.
