Aug 7, 2020
In India, chicken prices at the farm gate plunged as much as 70%, forcing farmers to cull large numbers birds causing severe loss in business.
India’s poultry industry is in dire state and needs a solid cash after prices decreased earlier this year on speculation fanned by social media that chickens could spread the coronavirus, according to one of the top poultry keepers.
“Chicken prices at the farm gate plummeted as much as 70% in March from January, forcing farmers to cull large numbers and causing huge losses”, said Suresh Chitturi, vice chairman and managing director of Srinivasa Farms Pvt. Prices have now recovered to just above production costs, but banks are still not willing to lend, he said.
Chitturi further said, “Farmers need up to 200 billion rupees ($2.7 billion) in loans. Bank financing is crucial to the $14 billion industry which directly or indirectly employs 5 million people and supports 25 million producers. With an annual output of 95 billion eggs, India ranks second in the world”.
“We don’t want any freebie,” said Chitturi, who is also the chairman of the International Egg Commission. “We just need the cash to expand and we will pay back the money. We have seen an increase in demand recently and prices are also good because of a shortage in supplies,” he emphasized.
“The industry won’t survive if it doesn’t get the funding as there is a risk of default on existing loans totaling as much as 250 billion rupees. We were beaten by rumors which almost killed the poultry business. I’d be making good money if I were in the U.S. or China as people there are consuming more poultry to have good protein intake,” he said.
According to the U.S. Department of Agriculture, chicken consumption in India is seen shrinking about 8% from last year to a three-year low of about 4 million tons in 2020. By contrast, demand in China will probably climb by 11% to a record of more than 15 million tons, while U.S. consumption is forecast to rise to an all-time high of over 17 million tons, stated the department.