1 week ago
Ethanol Demand Raises Maize Costs, Pushing Egg Prices Higher
Maize is used to feed chickens and also to make ethanol fuel.
More maize is now being sent to ethanol factories, leaving less for poultry farmers.
This has helped push maize prices much higher.
Since chicken feed costs more, producing eggs and chicken also becomes more expensive.
Egg prices have already risen by about 35% to 40% in the past year.
People may buy more eggs in winter, which could push prices up further.
However, ethanol is not the only reason poultry prices change.
Heat, disease-related deaths, weather problems, soybean prices and imported feed costs can also matter.
Egg prices in India have risen by about 35% to 40% over the past year.
Maize prices have climbed from roughly ₹14,000 to nearly ₹26,500 per tonne in three years.
About 37% of India’s maize production, or nearly 17 million tonnes, is currently used for ethanol.
Poultry farmers face higher costs because maize accounts for about 65% to 70% of production expenses.
Egg prices could rise further in winter as seasonal demand increases, although other factors also affect poultry prices.
- Who
- Poultry farmers, ethanol producers, consumers and the National Egg Co-ordination Committee are involved.
- What
- Growing maize use for ethanol has tightened supplies, increased poultry costs and contributed to higher egg prices.
- Where
- The pressure is occurring in India; maize imports have included supplies from Myanmar and Ukraine.
- When
- Egg prices rose by about 35% to 40% over the past year; maize-based ethanol production grew from about 1 million tonnes in 2022 to roughly 17 million tonnes currently.
- Why
- India’s ethanol-blending programme has increased demand for maize, while poultry producers depend heavily on the crop for feed.
Ethanol Demand Is Raising Costs
Several Factors Affect Poultry Prices
Main cause of higher feed costs
Ethanol Demand Is Raising Costs
The National Egg Co-ordination Committee official linked the diversion of roughly 37% of maize production to ethanol distilleries with tighter supplies and higher egg-production costs.
Several Factors Affect Poultry Prices
A senior industry executive said ethanol demand is not the only influence; soybean prices, heat stress, mortality, weather disruptions and imported feed costs also affect poultry expenses.
Winter price outlook
Ethanol Demand Is Raising Costs
Higher maize costs and increased winter egg consumption could place further upward pressure on egg prices.
Several Factors Affect Poultry Prices
The eventual price movement depends on several supply and production conditions, so ethanol demand alone does not determine consumer prices.
Supply response
Ethanol Demand Is Raising Costs
Continued growth in maize-based ethanol production could intensify competition for domestic maize and increase pressure on poultry farmers.
Several Factors Affect Poultry Prices
India has increased maize imports, including from Myanmar and Ukraine, and imports could rise further if domestic production does not grow quickly enough.
Key facts
- Egg price increase
- About 35% to 40% over the past year.
- Current egg prices
- Around ₹7 per egg at the farm level and ₹8.50 to ₹9 at shops.
- Current maize price
- Nearly ₹26,500 per tonne, compared with about ₹14,000 three years ago.
- Maize used for ethanol
- Nearly 17 million tonnes, or roughly 37% of India’s total maize production, according to the cited figures.
- India’s maize production
- Around 43.4 million tonnes.
- Poultry production costs
- Maize accounts for approximately 65% to 70% of poultry production costs.
- Ethanol outlook
- Maize-based ethanol production could reach around 25 million tonnes by 2030.
- Maize imports
- Imports reached a record 1 million tonnes in FY25; current imports are around 500,000 tonnes.
Quotes
Senior NECC official
An official of the National Egg Coordination Committee commenting on maize use and poultry prices
“Roughly 37% of the total maize production is now going to ethanol distilleries. In the past one year, egg prices have gone up by nearly 40% and are likely to rise further,”
businesstoday.in
livemint.com
Sources
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