Pune: Hit by cash crunch, poultry sector sees Rs 100 crore loss

On Saturday, a kilogram of dressed chicken was sold for Rs 90 in Aurangabad. This, according to Sanjay Nalgirkar, director of K Delight Poultry, is the lowest recorded price in Maharashtra this year.

“Two years ago, the price of dressed birds had also dropped, but that was due to overproduction,” he said. The recent fall in prices is due to low sales and accumulated stock with farmers as well as retailers, which have remained unsold. Nalgirkar said in the immediate days after withdrawal of old notes, the effect on the poultry market was not particularly severe, but sales have dipped drastically since then. “Currently, the sales are down by 60 per cent,” he said.

On an average, Maharashtra consumes about 1,300 tonnes of chicken per day. In November and December, the consumption increases by 20-25 per cent, hiking the price of poultry. “This year, the prices fell instead… due to the cash crunch,” said Nalgirkar.

The total turnover of the industry in Maharashtra per month is about Rs 300 crore. The unorganised retail sale of live birds constitutes 80 per cent of the total business, while 16 per cent of the sales are of fresh, chilled chicken, which are sold to hotels or food chains like KFC or McDonalds. The remaining 4 per cent of the market comprises frozen chicken; companies such as Godrej and Venkateshwara Hatcheries (Venky’s) are part of this segment. The retail, unorganised sector barely has any connection with organised banking, as most of the sales are made through cash.

Prasanna Pedgaonkar, deputy general manager of Venkateshwara Hatcheries, said poultry farmers have incurred major losses. Maharashtra has 15,000 poultry farms and 7,00 farms for production of eggs.

However, Pedgaonkar said the industry has started taking steps towards digitilisation of the retail sector. A meeting of retailers was held in Panvel to address the issue. “We have to bring the retailers within the banking network,” said Pedgaonkar.