Davada Foods challenging times in Estonia market

 The Estonian egg producer Dava Foods, whose parent company is based in Denmark, managed to maintain almost the same revenue and profit as the previous year, despite competing with cheap eggs from foreign competitors. In 2024, the company earned a revenue of 11.8 million euros, which decreased by only 4% compared to the previous year. The profit remained at 1.08 million euros, the same as the previous year.

Last year, Dava Foods invested over 2 million euros in establishing a farm for free-range hens. The company usually operates with 300,000 caged birds, but the new farm added 50,000 free-range hens. About 55% of the eggs sold in Estonia are produced locally, while the rest are imported from countries where egg production is cheaper, keeping the price of eggs in Estonia lower.

Although Estonian egg producers are moving from caged hens to free-range hens, Dava Foods' CEO Allan Tohver explained that there is no point in increasing egg production in Estonia, as it is not profitable. Consumers may prefer free-range eggs, but they mainly buy cheap caged eggs imported from Latvia, Poland, and Ukraine.

Since last November, countries have started keeping eggs for themselves due to the global shortage. For example, Latvians do not want to sell here because the expected price is too low. In the USA, bird flu has caused a significant egg shortage, leading them to ask for eggs from European countries. However, Estonian egg production is so small that the USA has not asked for egg aid from Estonia.

In Europe, only Malta has smaller egg production than Estonia. Estonia has about 900,000 birds, while Latvia has 3.5 million hens. The Ministry of Agriculture has not yet responded to whether the USA has asked for egg aid from Estonia.

The company notes that there are many Ukrainian eggs on the local market, which pose a high risk of salmonella. Ukrainian eggs are mainly sold by Lidl and Maxima. Usually, eggs produced outside Europe cannot be sold in the European Union, but an exception has been made for Ukraine due to the war. In Ukraine, battery cage systems are used for egg production, which have been banned in the European Union since 2011, making their eggs cheaper but with a higher risk of salmonella.

Dava Foods predicts that due to high inflation and new taxes, the prices of other goods and services will rise this year, putting pressure on the company to increase wages. The company forecasts a decline in egg prices in the second half of the year as European farms recover from bird flu and salmonella.

Source: Aripaev.ee