Will your breakfast get costlier? Egg prices jump 40% as ethanol pushes maize to ₹26,500

Egg prices in India have risen sharply over the past year as increasing quantities of maize are being diverted towards ethanol production, pushing up poultry feed costs. According to data from the National Egg Co-ordination Committee (NECC), egg prices have increased by around 35-40% over the past year. Ex-farm prices are now around ₹7 per egg, while retail prices range between ₹8.50 and ₹9.

The increase comes ahead of the winter season, when egg demand typically rises, raising concerns that prices could climb further.

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Maize diversion puts pressure on poultry feed

Maize is a key ingredient in poultry feed, and its growing use for ethanol has tightened supplies for poultry producers. A senior NECC official told The Economic Times, “Roughly 37% of the total maize production is now going to ethanol distilleries.” The official added that egg prices had risen by nearly 40% over the past year and could increase further.

Parliament data shows India's total maize production at around 43.4 million tonnes, with nearly 17 million tonnes currently being used for ethanol production.

The supply pressure has also pushed maize prices significantly higher. Prices have risen to around ₹26,500 per tonne, compared with approximately ₹14,000 three years ago. They have increased by nearly 20% in the past five months, adding to poultry farmers' production costs.

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Poultry industry caught between food and fuel demand

The poultry industry consumes roughly 60% of India's maize, making it one of the biggest users of the crop. With ethanol producers also demanding more maize, poultry farmers are facing higher input costs.

A senior industry executive told the financial daily that maize and soybean prices have a direct bearing on poultry feed costs, and any sustained increase in feed prices eventually reflects in the cost of producing eggs and chicken.

However, the executive noted that ethanol demand is not the only factor influencing poultry prices. Heat stress, mortality levels, weather disruptions and the cost and availability of imported feed ingredients can also affect production costs.

Ethanol production has surged

Maize-based ethanol production has expanded rapidly, rising from around 1 million tonnes in 2022 to more than 6 million tonnes in 2024 and approximately 17 million tonnes currently. Experts expect production to reach around 25 million tonnes by 2030.

The increase follows India's ethanol-blending programme, which requires petrol to be blended with ethanol. As blending has increased to 20%, demand for maize and sugarcane for ethanol has also grown.

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India turns to maize imports

The growing demand has affected India's position in the global maize market. India was previously an exporter to countries such as Bangladesh and Vietnam, but shrinking domestic surplus has increased the need for imports.

According to industry executives, India's corn imports reached a record 1 million tonnes in FY25. The country also sourced non-GMO maize from Myanmar and Ukraine. India is currently importing around 500,000 tonnes, with imports expected to rise if domestic production does not increase quickly enough.