Corona impact: Poultry farmers bleed as prices plunge below production cost

Many small and unorganised players have been forced to close down and explore other means of livelihood

Poultry prices have declined by a third in the past month because of receding consumer demand amid the coronavirus outbreak.
 

Broiler chicken in the benchmark Bengaluru wholesale market was quoted Rs 61.76 a kg on average in February, as against Rs 91.58 a kg in January. Similarly, broiler chicken in the Hyderabad and Muzaffarpur (Bihar) wholesale markets was sold at Rs 61.28 a kg and Rs 78.66 a kg, respectively, in February, as compared to Rs 86.28 a kg and Rs 90.13 a kg in January. Egg prices have also plunged. 

Though the government and farmers have rejected the possibility of coronavirus spreading through consumption of chicken and eggs, demand for poultry has plunged.

“Poultry consumption has declined sharply since the outbreak of coronavirus. Mammals, not birds, are the main source of coronavirus,” said K G Anand, general manager, Venkateshwara Hatcheries, which sells poultry products under Venky’s brand. 

Poultry farmers are suffering heavy losses following the sharp drop in prices. According to Anand, a broiler chicken is currently being quoted ex-farm at Rs 40 a kg, as against its cost of production of Rs 80-85 a kg. 

 

 

“The entire poultry sector is led by small and unorganised players. They cannot survive at such massive losses. As a consequence, they are cutting their production capacity. In fact, many small farmers have shut down their operations and shifted to other means of livelihood,” said Ramesh Chander Khatri, president, Poultry Federation of India.

Poultry farmers have been suffering for over two years because of a sharp spike in prices of raw material. Though feed prices have moderated of late, the decline in chicken consumption because of the coronavirus fear has hit farmers hard.

Feed prices have declined 6-15 per cent in the last one month. The average soybean price has fallen 6 per cent to Rs 4,067 a quintal in February, as against Rs 4,329 a quintal in January.

Similarly, maize and bajra have become cheaper by 15 per cent and 8 per cent, respectively. Maize and bajra traded at Rs 1,994 a quintal and 1,806 a quintal, respectively, in February as against Rs 2347 a quintal and Rs 1965 a quintal in January.

“We expect demand to return to normal in two months. But by then the summer season will set in and it remains a lean period for the poultry sector. However, reduced availability may have some positive impact on prices,” said Anand.

The data compiled by the Poultry Federation of India shows that the Rs 1-trillion poultry sector employs 20 million people, directly and indirectly.