Bird flu in US could help revive Indian egg exports

A short-term crisis in the poultry sector due to one of the worst bird flu outbreaks in the US could well prove to be an opportunity for Indian poultry industry. Domestic players are expecting a cascading impact of the crisis in global markets, leading to demand for its eggs in some countries.

The industry, which used to export 20 crore eggs a month till about six years ago, now exports only small numbers. There may not be a direct export opportunity from the US as it was contemplating to source the eggs from the European Union to meet the shortfall.

Egg prices shot up by 31 per cent in June over the previous month in the US to a record $2.57 for a dozen large eggs, Bureau of Labour Statistics data published on Friday said.

The US killed about 48 million chickens and turkeys in the six months to stop the spread of the disease.

Could the US crisis trigger demand for imports from India?

“Theoretically, yes. It should help us. But practically there are several technical issues. We can’t airlift eggs because it won’t be viable. You can’t ship them too,” Venkateshwara Hatcheries General Manager KG Anand told BusinessLine.

“If they take it from the European Union, it would result in demand for Indian eggs in other global markets,” he said.

“There are chances that the US might source the eggs from Europe, which is nearer to it. When it happens, it would result in demand from other countries that depended on European eggs,” he pointed out.

The industry expects that impact of the losses might be reflected next year too.

The USDA pegged 2015 egg imports at 41.4 million dozen, up 32 per cent from its May forecast and 26 per cent above 2014 imports.

India, which produces 20 crore eggs a day, used to export up to 20 crore eggs a month till six years ago, mostly to the Gulf and African countries. But they have come to a naught now with the target countries ramping up their domestic production.

“The crisis in the US could help us revive exports. Though it is temporary in nature, this could help us re-establish the old channels,” Subba Raju, a poultry player and a member of the National Egg Coordination Committee (NECC), said.

He pegged the likely export demand at 7-8 containers (each container having five lakh eggs) to some countries because of the egg crisis in the US.

India recently lost a case at WTO that ruled in favour of removal of curbs against dumping of chicken legs from the US.

As it fears flooding of US cheap chicken legs that have good demand in institutional sales, the Indian poultry industry expects to get a pie in the high-value global exports. The shortage would help in increase in overall egg prices, benefitting the industry.