March 30, 2011
 

India's chicken prices increase in the South

Costly production and reduced output has caused chicken prices to rise dramatically across the south of India.

Normally, chicken prices drop when summer approaches but the prices of corn which is the main ingredient of chicken feed, have risen sharply.

"Corn prices have gone up by INR3,500 (US$78.16) to INR12,500 (US$279.17) per tonne. This, together with a decline in chicken production, has pushed up poultry prices," said B. Soundrarajan, Managing Director of Suguna Poultry Farms.

Erode-based SKM Animal Feeds and Foods has raised the prices of poultry feed by INR2 (US$0.045) to INR20/kg (US$0.45). The production general manager said a further increase was in store as corn prices are on the upswing.

Chicken prices are currently ruling in the range of INR108-112 (US$2.41-2.50) per kilogramme in Kerala and Tamil Nadu. The prices were less by half this time last year and the surge in the prices has happened despite the Lent season, when Christians abstain from eating meat. "Fearing a drop in the prices, traders did not stock enough birds for the March-April season this year. As a result, there was a severe shortage in the market which reflected in the prices," said a Kochi-based poultry dealer.

However, the early onset of summer has seen egg prices falling by 30%. The festive period of Navratra beginning on April 2 in the north and the Lent season are expected to keep the prices under pressure, said traders and poultry owners.

"Egg consumption has drastically fallen by 20-25%. Prices have come down to INR1.85 (US$0.041) from INR2.60 (US$0.058) an egg a fortnight ago. We expect them to further go down to INR1.70 (US$0.038) by next week," said Rajpura-based Mehta poultry farm owner, Sandeep Mehta. He said chicken prices remained stable with a 5% fall in prices at INR70/kg (US$1.56).

According to the media, egg prices have fallen to INR2.20 (US$15.67) an egg from a high of INR3.02 (US$0.067) two months ago. A drop in consumption and excess stock are the main reasons for the low prices, said the director of Ravi Poultry Farms. As traders are consciously reducing the stock, prices may rise by 10% in the coming weeks.

Falling prices have led to an increase in commercial cold-storage of eggs by traders in north India. "Egg prices are very low at this time of the year compared to last year's rate of INR240 (US$5.36) for 100 eggs. Major traders across Delhi, Lucknow, Kanpur, Jhansi and Patna are keeping them in cold storage which will be sold later after and during the rainy season," said Faridabad-based Arora Egg Sale owner, Surinder Kumar. According to an industry estimate, over 100 to 120 million eggs are kept in cold-storage from March to May.