The cost of eggs in India has increased sharply over the past one year, and there is the possibility that another hike might be witnessed within the winter season.
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This has been triggered by the high prices of maize, which is one of the most important feeds in chicken farming. The prices of maize have increased significantly due to the growing demands of ethanol industry, hence increasing production costs.
As winter comes, the demand for eggs is likely to go up; therefore, the prices will stay firm.
According to the National Egg Coordination Committee (NECC), egg prices have increased by around 35% to 40% over the past year.
Farm-level prices have reached around Rs 7 per egg, while consumers are currently paying approximately Rs 8.50 to Rs 9 per egg at retail outlets.
The poultry industry expects prices to remain high as demand typically increases during winter.
The rising cost of poultry feed is among the major causes.
Feed constitutes a large percentage of the cost involved in producing poultry.
In the poultry industry, maize is the main ingredient in the feed composition, accounting for about 65% to 70% of total production costs.
As such, when the cost of maize rises, the cost of producing eggs and chickens becomes very high.
The cost of maize has increased sharply.
According to industry figures, maize was selling at around Rs 14,000 per tonne three years ago. It is now close to Rs 26,500 per tonne.
Prices have also increased by nearly 20% in the past five months, adding further pressure on poultry producers.
For farmers already dealing with other production expenses, the increase in feed costs can significantly reduce profit margins.
The surge in the demand for ethanol is another factor putting pressure on maize supplies. India has been increasing the use of ethanol in petrol as part of its effort to reduce dependence on traditional fossil fuels and increase the use of biofuels.
While sugarcane remains an important source of ethanol, maize is increasingly being used by ethanol producers.
According to a senior NECC official cited by The Economic Times, around 37% of India's total maize production is now being used by ethanol distilleries.
This means poultry farmers and ethanol manufacturers are competing for the same crop.
This trend has been increasingly obvious in recent times.
Ethanol production from maize has grown from approximately 1 million metric tons in 2022 to about 6 million metric tons in 2024, according to industry estimates.
This number is currently projected to be about 17 million metric tons.
According to industry estimates, ethanol production from maize may rise to 25 million metric tons in 2030.
