Poultry prices, which saw a decline from April to August, have now begun to rise again. This increase is attributed to the conclusion of the Hindu religious periods of Shravan and Adhik Maas, along with Sri Lanka increasing its imports of eggs from India. Experts anticipate that the demand for chicken and eggs will remain strong, leading to price increases in anticipation of the upcoming festivals and the wedding season in the October to December quarter.
Furthermore, there is an expected increase in the prices of soya, a key component of poultry feed, after the harvest season, which is also expected to put upward pressure on chicken and egg prices. To provide some context, this month, chicken prices have risen to Rs 92-122 per kilogram at farm gates in Kolkata, Bengaluru, and Delhi, with retail prices ranging from Rs 250 to Rs 260 per kilogram, according to spot trading data. In contrast, in July and August, farm gate chicken prices were around Rs 90-100 per kilogram, and retail prices were quoted at Rs 180-210 per kilogram.
Egg And Chicken Prices Rise
Similarly, egg prices in Delhi, Kolkata, Mumbai, and Bengaluru have seen an uptick, reaching Rs 540 per 100 pieces in wholesale markets and Rs 650 at retail outlets in September. In the preceding two months, wholesale egg prices ranged from Rs 415 to Rs 515 per 100 pieces, while retail prices were in the range of Rs 520-550.
The broiler chicken prices have remained strong immediately after the Shravan months. This resilience in prices can be attributed to producers aiming to maintain their profit margins, robust consumer demand, and the anticipation of the upcoming soya harvesting season in October, which may not yield favorable results. Poultry producers have pre-emptively increased prices in anticipation of rising input costs.
Furthermore, the delayed and erratic rainfall in Madhya Pradesh, the leading soybean producer, has resulted in wet soil conditions that are likely to negatively impact both the quality and quantity of the upcoming soybean harvest. This has contributed to poultry producers' decisions to raise prices in anticipation of increased input expenses.
Another influencing factor is Sri Lanka's decision, towards the end of August, to significantly increase its egg imports from India. This move was made to mitigate price fluctuations caused by local egg shortages. Sri Lanka has been dependent on India to meet its domestic egg demand since March, following a foreign exchange crisis that affected the import of animal feed and caused a shortage in poultry supply.
However, it's worth noting that despite the recent rebound in egg and chicken prices, this may not necessarily translate into higher food prices. The 15-day Shradh and Navratri period could lead to a temporary cooling of poultry prices, according to Devendra Kumar Pant, the chief economist at India Ratings & Research. He also mentioned that food inflation is likely to decrease from the previous month, mainly due to a sharp decline in tomato prices and some cooling in other food prices. Food inflation stood at 10.6% in July and 9.2% in August. Chicken and eggs account for 1.23% and 0.43% of the Consumer Price Index, respectively.
