Why is your chicken getting expensive
A thread.🧵
A thread.🧵
Have you felt chicken prices inflating lately?
Well, thanks to the pandemic, supply is still in shambles and higher input costs are pushing prices upwards. How?
Spoiler alert - Soyabean is to blame.
Well, thanks to the pandemic, supply is still in shambles and higher input costs are pushing prices upwards. How?
Spoiler alert - Soyabean is to blame.
First, let’s get some context on how prices in the chicken market work. In this market, there’s a ‘Farm Gate Price’ and a ‘Retail Price’.
The Farm Gate Price reflects the price at which poultry farmers sell live birds to retailers, and this has risen from Rs. 90 per kg, just a few days ago to over Rs. 128 per kg now. Why?
The thing is that the chicken’s food is getting expensive. Feed prices have been skyrocketing since 2019, the components responsible for this price hike being soya meal and maize.
Prices of soya meals have escalated by a massive 82% since last year, and this has translated into a 25% rise in the overall price of feed.
In fact, just over the course of the last 4 months, the price of soya went from Rs. 35 to Rs. 76 per kg and that of maize went from Rs. 15 to Rs. 22 per kg, thus making the feed more expensive.
Now, when you add the costs of storage, transport, & profit margins of the chicken sellers to this, you get the Retail Price.
And this retail price has soared from Rs. 140 to over Rs. 260 per kg in a span of 2 months.
And this retail price has soared from Rs. 140 to over Rs. 260 per kg in a span of 2 months.
Ultimately, it’s the bottom line of the poultry industry that’s taking the hit. The sector’s profit margins are dwindling and industry reps are lobbying the govt. for duty-free import of soya meals.
This might help cool down the exorbitant domestic prices. But as of now, as much as 30% of poultry farmers in the country have shut shop due to the rising cost pressures.
What are your thoughts?
What are your thoughts?
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