January 15, 2013

India's egg rate fails to pick up in the New Year

Due to over production, India's wholesale egg rate did not pick up during the New Year.

Average per capita consumption of egg is only 52 per year in India against 349 in China. Farmers claim that the existing wholesale price of INR3.40 (US$0.06) is forcing them to incur loss due to high cost of production, in a season that used to be profitable in previous years.

For more than two weeks, wholesale price of egg has remained at INR3.40 (US$0.06). The last few days in December and first week of January was that part of the year when egg scaled to a new record high price.

"But it was not the same this year," Chairman of the National Egg Coordination Committee (NECC), Namakkal Zone, P. Selvaraj told The Hindu.

"The prevailing price is INR0.25 (US$0.005) less than the highest price of egg - INR3.65 (US$0.07) that was fixed in September 2012. The over production has been estimated at 15% across India - of which Namakkal is not an exemption. Anticipating this situation farmers were advised to bring down production of egg (about two months ago) by selling the old hens for meat at an earlier stage."

He said that this was aimed at realising better prices for eggs, but at that time farmers could not sell their hens to their two main markets - Karnataka and Kerala that account for 60% and 40% respectively of the egg laying birds for meat from Namakkal - due to the ban on poultry items in those States after the bird flu scare.

"Heavy drop in price of broiler chicken forced farmers to refrain from selling hens for a few more days. These hens continued laying eggs," Selvaraj said and claimed it as one of the main reasons for overproduction.

He said that late farmers here have reduced replacement of aged hens with new chicks by as much as 30%. These chicks will start laying eggs five months later. Production of egg will come down only then and help price of the commodity to start picking up.

Poultry farmers said that the cost of production of egg that was around INR3.25 (US$0.059) about four months ago has come down to INR3.15 (US$0.057) now.

"We are getting only around INR3-3.10 (US$0.054-0.056) in hand due to slow movement of egg despite good demand for egg due to the freezing winter in the Northern States," poultry farmers lamented.