Poultry industry in doldrums as egg prices decline

Poultry farmers across India are in a quandary, as egg prices did not see any increase on the onset of winter.

According to sources in the trade, the total egg production in the country stands at 600 million annually, and there has been a five per cent increase in production.

Shabbir Ahmed Khan, the convenor of the Poultry Federation of India, said the production capacites had been increased as there was demand in Indian market due to a rise in disposable income. But middlemen have been reaping the benefits.

Poultry farmers seek consultation for new projects to enhance production, but do not learn the marketing skills. The wholesale price, according to him, was Rs 3.50 per egg during this month last year and has now slipped to Rs 3.22 per egg. At the same time, the cost of production per egg has incrased to Rs 2.95 from Rs 2.80 last year.

According Devinder Ahlawat of the Haryana Poultry Farmers Association, prices are sticky as the number of poultry farms have proliferated in the past few years. This business has less hassles in terms of taxes (no sales tax and excise duty), but marketing is essential. The wholesellers negotiate their terms and the farmers get a lower price.

The plight of poultry farmers down south is worse as they are selling an egg at Rs 2.60 against the cost of Rs 3.

P Tamil Arson of Pepe Farms at Namakkal, Tamil Nadu said, “We are incuring a loss of 40 paise per egg this season. The beginning of the cold wave in the upper reaches of the Himalaya may bring some improvement in the coming weeks.”

The sharp increase in the prices of egg feed from Rs 15 per kg last year to Rs 22 per kg this year was the main driver of increase in cost.

“A drop in the cost of soyabean has resulted in the cost of poultry feed to fall from Rs 22 per kg to Rs 18.50 per kg. But we are still selling at a loss,” he said.

Traders in the business observe that a slight cut in the production was imperative for the industry to remain viable. The current year may end up as a loss-making year.