High freight costs weigh on Indian poultry exports

India's poultry exports, which halted in April and May due to the war in West Asia, are slowly regaining momentum despite soaring freight costs that are squeezing the profit margins of exporters. Competition from Turkey in the region has further fueled concerns among exporters. According to Valsan Parameswaran, Secretary of the All India Poultry Product Exporters Association, "Demand is currently mixed, and exporters do not see any significant growth yet, though the market is showing some signs of recovery."

Shipping services were severely disrupted by the conflict, leaving about 120-125 containers stranded. However, these were cleared by the end of May or early June. Exports gradually recovered to around 25-30 percent of normal levels in June and July, and have since risen by 10 percentage points each month, currently standing at 50-55 percent of normal levels.

The high freight rates have increased four-fold, with shipping costs from India to the UAE jumping from approximately $1,900 per container to around $9,000. Parameswaran has appealed to the government to mediate with shipping lines to reduce costs and increase sailings. He also urges the government to provide some form of subsidy to offset the high freight expenses.

Despite absorbing losses due to high freight rates, exporters continue to ship products to maintain trade flow, cash flow, and operational workforce, as well as to protect their market share. The UAE remains the largest market for Indian poultry products, primarily eggs. The Namakkal-Erode region in Tamil Nadu accounts for nearly all shipments, with about 11-12 approved compartment farms producing eggs for the export market. Some farms in Odisha have also received approval, but logistical challenges persist.

Last year, egg exports were estimated at around ₹2,000 crore, according to Parameswaran.