Commodities

Egg trade to hold prices on low offtake

Chennai | Updated on February 11, 2011

A scene from a wholesale egg shop in Broadway, Ernakulam - Photo: H. Vibhu   -  Business Line

Shell egg trade in Tamil Nadu has decided to retain last week's price level of their produce due to reduced seasonal consumption and changes in the market place, including low inventories maintained by traders.

To save the poultry farms from possible accumulation of stocks, the National Egg Coordination Committee's Namakkal zone has chosen to retain last week's rate of Rs 2.35 apiece. Egg prices had reached a record high of Rs 3.02 during the second week of January.

NECC Zonal Chairman Dr P. Selvaraj said the price reduction is mainly due to the stagnation of over 10 crore eggs during the Pongal holidays. Closure of government schools and Sankranti holidays led to excess stock of 2.1 crore eggs. Daily production stands at three crore. Mr Selvaraj added that it would take a fortnight to clear the stock and prices are likely to rule steady.

Industry sources attributed the drop in prices from January's peak to the stabilising weather conditions in North India which used to consume around 20 lakh eggs a day till January. The demand from North has now dropped to five lakh eggs a day.

Apart from fall in consumption, wholesalers and retailers prefer to keep the inventories low because high temperatures result in low shelf-life. Therefore, eggs tend to stockpile at the production centre, according to market sources. “Egg production has to be maintained even if profits are minimal because it's a long-term investment of around two years,” said Mr R. Nallathambi, President, Tamil Nadu Poultry Farmers' Association.

Meanwhile, chicken prices continue to be at rock-bottom levels. NECC has slashed the prices of layer birds to Rs 23/kg (Rs 26) while the Palladam-based Broiler Coordination Committee has raised the prices of cull birds to Rs 54/kg (Rs 51). On the export front, trade is now focusing on Sri Lanka as the country has decided to import until shortage is met and domestic prices stabilise. India, since mid-December, has exported around 18 lakh eggs to the island nation.

Published on February 10, 2011

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