The Hindu Business Line : High maize cost worries poultry farmers

Cost woes
Maize accounts for more than 80 per cent of the cost of production of eggs and broilers.
A farmer pays Rs 20,000 more on a truck load (10 tonnes) of maize.
Industry appeal to the Government to stop forward trading in maize.

Hyderabad March 25 The poultry industry, which is beginning to shrug off the severe crisis it faced last year in the midst of avian flu threats, is facing a fresh problem this time in the form of high cost of feed. "The industry has begun to get a good price of late both in layers and broilers. It indeed is a big relief for the industry, which suffered a serious blow last year. But the high cost of feed is resulting in less profits to the farmers," Mr D. Ram Reddy, President of Poultry Breeders' Association of Andhra Pradesh, told Business Line.

Nearly half of the 10-14 million tonnes of maize produced by the country annually is used as feed, mostly in poultry industry.

Maize accounts for more than 80 per cent of the cost of production of eggs and broilers. As against Rs 500-550 a quintal last year, maize is now priced above Rs 760. Andhra Pradesh accounts for one-third production of 18 crore layers and one-fifth of broilers in the country. The size of broilers fell to 25 crore from the normal 33 crore, with at least 20-25 per cent of poultry farmers having stopped raising birds. They succumbed to working capital constraints after last year's crisis.

With the prices of maize and soya shooting up in the last few months, the industry is appealing to the Government to make maize out of the purview of forward trading. The market has started reaccepting eggs and broilers, putting behind the fears of getting infected with the flu.

" Both short supply and increased acceptance have started yielding better prices for the industry," he said.

As against 30-40 paise for one egg during the crisis, the farmers are getting Rs 1.75 now. In the broilers segment, the price is at Rs 45 a kg as against Rs 15-16. But the industry is faced with the increasing prices of maize and soya, cutting into the revenues. "On an average, the farmer is paying Rs 20,000 more on a truck load (10 tonnes) of maize," he said.

Stop futures trading

"We would like the Government to extend the decision of excluding rice and wheat from forward trading to maize also," Mr Ram Reddy said. Citing the example of rice and wheat, he said the prices of these commodities were stabilised after the Government banned futures trading.

"Extending that to maize would do a great help to the farmers," he said. The industry felt that while the threat of bird flu was just a phase, the threat of short supply and high cost of maize and other feed seemed to be a long-term phenomenon.

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