Egg prices rising but poultry farmers hit due to high input cost

The price rise is expected to continue until the advent of Shravan in July, when some Hindus turn vegetarian for a month

The recent price rise in eggs is expected to continue till the commencement of ‘Shravan’ month that begins on July 20, when a number of observant Hindus turn vegetarian for the period. The demand for eggs is typically declines during this period and is expected to recover only after the festive season gets over in late November.
 
The farmgate prices of eggs have remained at an all-time high in the month of June this year and farmers have been earning an average Rs 4 per egg this month. On the flip side, escalating feed  ingredient prices, particularly maize and rapeseed, have burnt a hole in the pockets of poultry farmers.

 
Egg prices jumped as farmers reared fewer birds after incurring losses in the past two years. While that helped product prices to go up and improve realisations to an extent, many small poultry farms in Namakkal (Tamilnadu) and Barwala (Haryana) suspended operations due to non-viable products. This created a scarcity in supply and prices firmed up after April. According to P Silveraj, Chairman, NECC Namakkal, the farmgate price was 3.40 an egg in April, which has increased by 50 paisa an egg in a span of only two months.  
 

But poultry farmers are worried that this may only be a flash in the pan as prices of eggs would revert again in July but the feed ingredients will remain higher till the arrival of next crop, which is only after October-November.

 
According to Dinesh Bhonsale, vice president, Poultry Federation of India, “Maize is the major ingredient in poultry feed and constitutes 50%-60% of all the inputs so an increase from an average Rs 14 per kilogram in April to Rs 17 per kilogram in June has put the poultry sector in stress. The delay in monsoon by almost three weeks has added speculation in the commodity prices and any further delay may splurge price pushing up costs of farmers”.
 
Meanwhile, poultry farmers are also scouting for new locations to compress their costs even as incentives provided by Uttar Pradesh Government under its Poultry Development Policy-2013 have provided some succour to the ailing poultry sector in Punjab and Haryana.

 
A significant number of poultry entrepreneurs from Barwala-Derabassi-Lalru cluster are exiting this traditional and largest poultry cluster of north India and migrating to Uttar Pradesh. Interest subvention on loan, concessional power tariff and proximity to the market that cuts the logistics costs (UP is the major market for eggs produced in Haryana) has encouraged many poultry farmers to close down their operations in Barwala and set up shop in Uttar Pradesh.