Egg prices have gone through the roof, so much so that at current retail rates of around Rs 7 per piece, it could be more worthwhile for people to eat chicken instead.
Poultry farmers in the Pune region are now selling eggs at Rs 585 for every 100 pieces, which translates into a price of Rs 6.5-7.5 a piece at the retail end. That works out to Rs 120-135 in per kg terms, taking an average egg weight of about 55 grams - which isn’t far too below the Rs 130-150 levels at which dressed chicken is certainly retailing in Pune.
Over the last six months, farm-gate prices of eggs in Pune have risen from Rs 375 to Rs 585 per 100 parts, even as the prices for live broiler birds have crashed from Rs 90 to under Rs 60 per kg.
“Egg prices usually rise at this time due to winter demand, while broiler rates fall because supply goes up, with the birds taking less time to reach slaughter weight. But we have never seen this sort of price spiral in eggs before,” said a leading egg products manufacturer based in Erode, Tamil Nadu.
Raju Bhosale, executive member of the National Egg Coordination Committee (NECC), attributed the jump in prices to an estimated 15 per cent increase in demand. That, in turn, has been primarily driven by vegetable prices. Onions and tomatoes are today retailing at Rs 40-50 per kg, while ranging also higher at Rs 60-100 for cabbage, cauliflower and brinjal. “When vegetables turn costly, people switch to eggs, pushing up its rates as well. This is simple substitution effect,” claimed Bhosale.
M P Sateesh Babu, chairman of the Mysore zone of NECC (which is an association of poultry farmers and traders), however, sought to link the price spike to demonetisation. The collapse of demand from the sudden withdrawal of Rs 500 and Rs 1,000 denomination notes from circulation led to lower realisations for eggs along with broilers. Farm-gate prices for both averaged below last year’s levels right until July (see table at bottom).
“Simultaneously, drought in Karnataka and Tamil Nadu caused prices of maize, the main input for poultry production, to hit record Rs 1,900 per quintal levels. As poultry farmers were squeezed between low realisations and high costs, many of them resorted to premature culling of their birds, the effects of which are being sensed today on the supply aspect,” noted Babu.
One indicator of this is lower inter-area trade that ensures clean supply of eggs across the country. India’s poultry market is divided into 25 zones. “The Namakkal zone alone, for instance, witnesses normal arrivals of 3.5 crore eggs per day. This area normally also feeds the North Indian market, whereas in the current year, there has been very little inter-zone transport of eggs, including from Namakkal,” Babu said.
But why has the cost recovery, courtesy supply pressure, been sharper in the case of eggs than broiler? The response, according to the earlier-quoted egg products manufacturer from Erode, is simple. The broiler production routine is much shorter. A day-previous chick weighing 40 g or so takes just 40-42 days to achieve a live bird pounds of 2-2.5 kg, when it ready to be sold for slaughter. That time is even lower, 37-38 days, during wintertime.
On the other hand, when it comes to egg-laying birds (“layers”), the minimum period needed for the chicks to grow for creation to start is 18 weeks. A typical commercial coating would give roughly 330 eggs until it is 72 weeks old. During the peak production period from around 27 to 40 weeks, the bird will lay an egg every 26-27 hours, going up to 32-33 hours at the end of 72 weeks.
“When egg prices are goods, farmers may maintain the birds till 90 weeks, even if laying happens only once in 35-36 hours. This time, since egg rates were very low till July, with broiler realisations somewhat better, many level farmers went in for early culling. It provides impacted supplies now, just when demand is normally peaking,” the manufacturer explained.
Considering that egg production isn’t going to recover since fast as broiler, consumers may have to wait for a few weeks for prices to ease. In the meantime, it could be better for them to have chicken.
