Poultry Sector Experiences Smooth Recovery after Covid Pandemic

The Poultry sector has recovered quite smoothly in last few months, after experiencing the adverse impact of Covid pandemic as well as bird flu over the past one year. Improving poultry demand is also reflected in higher requirements for soy meal and maize (They have the largest consumption share in the poultry feed ingredients). Shortage of birds in the market and revival of demand across different states of India has resulted in sharp appreciation in the live bird/broiler chicks and egg prices.  

The industry has recently come out of the bird flu epidemic with prices of live poultry birds appreciating to nearly Rs. 90-100 per kg. As the prices of birds have increased, so have the prices of poultry feed derived from soybean and corn. The cost of feed is higher by about 8-10 per cent compared with the third quarter, as per sources from the poultry feed manufacturers.  

The prices of broiler chicks are ruling high around Rs. 48-52 as consumption levels are returning to the Pre-Covid level.  At the same time, there is a supply constraint all over the country.  The spread of Covid pandemic had affected the poultry sector badly during early 2020 across many States, forcing the small players to close down their businesses, because they suffered more than 40-50 per cent loss due to falling demand. After this, the emerging bird flu cases affected demand to some extent, which further resulted in lower production by the poultry farmers. All these developments resulted in shortage of chicks and poultry products.  Industry persons feel that the shortage problems will reduce in next few months. The threat of Bird flu scare is receding now as temperatures are rising.  

The poultry sector usually experiences improvement in consumption during April-May every year. But prices have started climbing tight from late February and March this year. Industry persons expect prices to remain firm for next few months on shortage of both live birds and broiler chicks, apart from improving demand situation.  As the lockdown restrictions are getting tighter against rising Covid cases, we may see a moderate easing on the consumption front. 

However it is already clarified by the government and the medical experts that consuming poultry production has no adverse impact over human health therefore it is quite likely that poultry sector shall continue with its growth trajectory moving forward. Another important point is that we may see relatively higher purchase interest for the branded chicken segment since the Covid and bird flu scare are reportedly attracting consumers towards the branded poultry products. Reports say that despite the industry shrinking by 5-7 per cent this year, the branded chicken segment is likely to show a healthy growth, both in the value added and processed categories. 

At present, the quantum of purchase is lesser from marriage ceremonies, professional or personal get-together activities, hotels and restaurants. Once adequate vaccinations occur and Covid cases start falling rapidly, or the lockdown restrictions are relaxed, consumption from these segments may improve noticeably.