When feed prices crack the egg market

An unusual warming of the Pacific Ocean, nearly 12,000 km from Telangana, is casting a shadow over the State’s poultry industry. El Niño may seem far removed from the price of an egg, but its ripple effects are being felt in the cost of maize and soybean, the two principal ingredients of poultry feed. For farmers, the question of what came first, the egg or the chicken, has a clear answer: feed comes first.

Prices of maize and soybean have surged even as the harvest is under way. Against the Minimum Support Prices of ₹2,410 and ₹5,708 a quintal, respectively, open-market rates are around ₹3,200 and ₹6,000, up from ₹2,000 and ₹3,500 six months ago. Poultry associations also allege deliberate hoarding.

“We are all worried. What will we be able to feed them in the coming months,” asks a representative of the Telangana Poultry Breeders’ Association which recently approached Chief Minister A. Revanth Reddy for urgent measures. They sought broken rice and rice unfit for human consumption from Food Corporation of India and Markfed godowns at a marginal subsidy. “We don’t want it for free,” he adds.

But rice cannot simply replace maize and soybean. Poultry feed is scientifically formulated to meet birds’ nutritional requirements at different growth stages. A commercial chicken needs about 1.5 kg of feed to gain 1 kg in body weight, enabling it to reach 2 kg in 36 days. This is its feed conversion ratio (FCR).

The ICAR-Directorate of Poultry Research (ICAR-DPR) has developed feed formulations, while the Bureau of Indian Standards specifies 15 types according to birds’ age and purpose. In 2022, ICAR-DPR published over 1,100 region-specific formulations. A typical 100-kg mix for breeder and layer birds contains 50% maize, 30% soybean, 15-18% de-oiled rice bran, and 1 kg each of mineral mixture and probiotics.

Former Animal Husbandry Department director V. Lakshma Reddy says standardised feed ensures balanced nutrition, digestibility and feed efficiency, helping reduce FCR and costs. “The present feed composition is a remarkable achievement by our scientists, animal nutritionists and geneticists,” he says, adding that a commercial layer chicken in Telangana produces about 320 eggs a year, comparable to output in the United States and Europe.

Research institutions such as ICAR-DPR in Hyderabad, Central Avian Research Institute-Bareilly, National Institute of Animal Nutrition and Physiology-Bengaluru and Indian Veterinary Research Institute-Bareilly are exploring alternatives such as Azolla, seaweed, oilseed meals, distillers dried grains with solubles (DDGS), gluten meal and tapioca. The Kerala Veterinary and Animal Sciences University has also tested Black Soldier Fly larvae as feed; processing units now produce it for poultry and fish.

Telangana, the country’s third-largest egg producer after Andhra Pradesh and Tamil Nadu, produces 3.80 crore eggs daily, according to the National Egg Coordination Committee (NECC). More than 2,000 farmers manage 5.5 crore layer birds, with 1.80 crore eggs shipped daily to Maharashtra, Madhya Pradesh and Uttar Pradesh.

On November 6, a dozen eggs at an egg syndicate in Netaji Nagar at Kapra, Hyderabad, cost ₹94, while a tray of 30 was priced at ₹210. The NECC’s suggested farm-gate price was ₹660 per 100 eggs. “Prices usually rise in November and peak in December because of cooler weather and Christmas and New Year demand. But the increase has come early,” says Raju, who sources eggs from farms in Medchal and Keesara.

The average NECC price in Hyderabad was ₹570 per 100 eggs in November last year and ₹655 in December. On November 6 this year, Chennai and Kolkata were already quoting ₹730, the highest in the country.

“Vernacular media readily writes kondekkina kodi (the chicken climbs the hill) when prices turn volatile. I want them to write kondekkina kodi dhaana dharalu (the price of chicken feed climbs the hill), too, so people understand the logic behind the increase,” says Krishna Reddy, president of the Siddipet Layer Farmers’ Association. Feed accounts for nearly 80% of production costs; the rest goes towards electricity, labour, rent and other expenses. Any disruption in prescribed feed can reduce egg and meat output and increase mortality, he warns.

El Niño’s impact on poultry is indirect: dry conditions can affect crop acreage and grain supplies, while heat stress adds to production costs. With feed prices rising and farmers operating on thin margins, consumers could feel the pinch in the cost of eggs and chicken.

November 6, the birth anniversary of Hyderabad’s Dr. B.V. Rao, is observed as NECC Day. His 1981 rallying cry, “My egg, my price, my life”, became the committee’s motto. It faces another test as the industry grapples with rising feed costs.