Egg prices in India have risen sharply over the past year and may climb further this winter. This stems from rising cost of maize, a key ingredient in poultry feed. Growing demand from ethanol production is putting additional pressure on the supply of this grain. This comes on the heels of rising sugar prices in the country.
Why Are Egg Prices Rising?
Egg prices have increased by around 35% to 40% over the past year, according to the National Egg Co-ordination Committee (NECC). Farm-level prices have reached around Rs 7 per egg, while consumers are paying roughly Rs 8.50-Rs 9 per egg at retail outlets.
Poultry executives expect prices to remain elevated and possibly rise further during winter, when egg consumption generally increases.
How Is Ethanol Production Affecting Egg Prices?
The pressure starts with maize, widely used as part of poultry feed. A growing share of India's maize production is now being diverted towards ethanol manufacturing, leaving less of the crop available for poultry farmers.
A senior NECC official told The Economic Times that around 37% of India's total maize production is now going to ethanol distilleries, adding to poultry production costs. “In the past one year, egg prices have gone up by nearly 40% and are likely to rise further,” the official added.
Why Is Maize So Important for Poultry Farmers?
Maize is the largest single expense for poultry farmers, accounting for around 65%–70% of total production costs. Its price has increased significantly, from around Rs 14,000 per tonne three years ago to nearly Rs 26,500 per tonne currently.
According to ET, maize prices have also risen by almost 20% in the past five months. Higher feed costs put pressure on farmers' profit margins and can eventually result in higher prices for eggs and chicken.
India's Growing Ethanol Demand
India's ethanol programme is aimed at reducing dependence on traditional petrol by increasing the use of biofuels in petrol blending. The ethanol share in blended petrol has reached 20%, increasing demand for raw materials such as sugarcane and maize.
Maize-based ethanol production has grown rapidly, from around 1 million tonnes in 2022 to more than 6 million tonnes in 2024, and about 17 million tonnes currently. Industry estimates suggest maize use for ethanol could reach 25 million tonnes by 2030, potentially increasing competition for the crop.
Ethanol Is Not The Only Factor
However, the rise in poultry costs cannot be attributed to ethanol alone. A senior industry executive told The Economic Times that factors including heat stress, mortality levels, weather disruptions and the availability and cost of imported feed ingredients can also affect production costs and market prices.
With winter typically bringing stronger demand for eggs, a combination of higher feed costs and seasonal consumption could keep egg prices under pressure in the coming months.
Other Kitchen Staples Also See Price Pressures
Eggs are not the only kitchen staple becoming more expensive. In Delhi, onion is currently available at around Rs 50-60 per kg. The Centre has now expanded its subsidised onion sale to 19 cities, offering onions at Rs 35 per kg, including 1,000 metric tonnes for Delhi to be sold through fair price shops and mobile vans. Meanwhile, jaggery prices have also increased recently, taking the price to Rs 90-100 a kg from Rs 70 in July.
