Good price of eggs in 1997 (upto Rs 143 per 100 eggs) had resulted in too many small players entering the field and flooding the eggs market in 1998.

Overproduction of eggs had led to consistent fall in egg prices to as low as 88 paise per egg in April 1999. This accompanied by doubling up of maize prices last year, had resulted in farmers suffering heavy losses. And around 3,600 poultry farmers in Namakkal, a major poultry centre in Tamil Nadu, had gone bankrupt and shut shop last year. Consequently, egg production in the state dropped and is currently not able to meet the demand.

Also, other metros in the country are also witnessing peak prices ofeggs now - Rs 174 per 100 in Delhi, Rs 167 in Calcutta, Rs 158 in Mumbai and Rs 150 in Bangalore, as of Tuesday. Therefore, poultry farmers in Andhra Pradesh and Karnataka, who earlier had to defer to the prices of the Chennai market, have now started diverting their produce to other markets thereby forcing the Chennai market to revise its prices.

Despite the ongoing Ayyappa season (November 15 to January 15), during which the egg consumption in Chennai usually drops by 30 to 35 per cent, 25 to 30 lakh eggs per day are being consumed in the city. Last Ayyappa season, only around 22 lakh eggs per day were sold in Chennai. If the present trend of peak market prices and demand of eggs continues for at least one month, farmers can cover the losses they made last year, according to M Ashok Kishan, assistant manager - co-ordination, Chennai Zone of NECC (National Egg Co-ordination Committee).

Market analysts say that the trend is also expected to bring small farmers back into the fold of layer (egg production)business.