Prospects are improving for Indian chicken and egg producers. However, farmers report only just achieving break-even status, despite the recovery in consumer demand and low feed prices.
Over the past two weeks, prices for poultry have increased by as much as 25%, reports Business Standard. Since the start of this month, farm-gate prices for chicken have risen from just 60-65 rupees (INR; US$0.79-0.86) per kilo to INR75-80. A single egg now costs INR4.50-5.00 — up from INR3.00-3.50 over the same period.
Despite the price rises, farmers report they are only just covering their production costs. With output and demand from the poultry sector so low, prices of feed ingredients — corn (maize) and soybean meal—have been tumbling.
Stronger demand for poultry
Strengthening of consumer demand has been identified as the main driver for improving prices. This situation has resulted from an easing in the lockdown conditions imposed nationally in March with the arrival in India of the coronavirus (COVID-19) pandemic. After 75 days, the heavy restrictions were generally eased across the country on June 8.
Lockdown afflicted the country’s poultry producers in a number of ways, reports Business Standard.
According to K.G. Anand, general manager of Venkateshwara Hatcheries (VH), unfounded rumors linking chickens to the COVID-19 infection virus almost halted poultry sales soon after the lockdown started.
Subsequently, transportation was disrupted, preventing the movements of supplies as well as poultry products to markets. For small-scale farmers, the loss of two cycles of broiler production during lockdown led to great hardship.
For the remaining 70% of producers—including the VH Group—business survival was achieved by channeling sales into processed and other value-added products, according to Anand.
According to the report, increased popularity of home delivery services is boosting sales of frozen chickens.
Challenges remain
For the many producers who sell poultry products into the hotel, restaurant and catering (Horeca) sector, the market is still challenging. Previously accounting for around 40% of total sales, many of these outlets remain closed. Recovery of the sector is unlikely until large gatherings such as weddings are permitted again, reports the National Egg Coordination Committee.
Although restrictions are generally being eased across India, identification of local COVID-19 hot-spots led to lockdowns being prolonged or re-instated. One of these is currently in operation in Chennai, according to the U.S. Department of Agriculture’s Foreign Agricultural Service (FAS). Here, only grocery shops are allowed to open — for limited hours daily — over the period June 19-30. In one city district, even grocery shops have been forced to shut.
Meanwhile, false rumors of a connection between COVID-19 and poultry continue to circulate on social media. As recently as this week, India TV News reported that health authorities in Madhya Pradesh have clarified the situation on testing of poultry products for the virus.
The state’s Animal Husbandry Department has termed the allegations “baseless.” It has reiterated that “consumption of chicken is completely safe, and does not cause infection.”
Periodically, highly pathogenic avian influenza (HPAI) is detected in India. Within the past month, the national veterinary authority has confirmed three outbreaks among poultry in two states, and in other birds at three other locations.
