May 25, 2007

Egg and chicken prices rise in India as summer production falls

Egg and chicken meat prices are rising in India due to a shortage caused by less placement of chickens.

Farmers have been reducing placements since bird flu occurred last year. The disease saw demand for chickens plunging and hundreds of poultry farms have had to close down. Even as India declared itself free of bird flu in August last year, consumption languished for a few months more before picking up again.

Bird placement fell during 2006 and the market is feeling that effect now, Vasant Kumar, member of the National Egg Coordination Committee (NECC) and managing director of Balkrishna Hatcheries said.

Placed layer birds would take more than five months before they begin laying eggs.

Consumption would usually fall by 15 to 20 percent during summer, meaning that farmers would adjust their production accordingly. India normally produces 100-110 million eggs a day but during summer, production comes down to 80-90 million eggs. The production shortfall this summer has worsened the shortage.

Egg prices have now risen from the usual 135-145 rupees per 100 eggs to 190-193 rupees. Meanwhile, wholesale chicken meat price is 45-46 rupees per kg, up from the usual summer price of 35 rupees.

Although production would increase in the next few months, egg and chicken meat prices are unlikely to be reduced as demand would increase further, analysts said. Various studies have said Indians are eating more chicken.