Poultry farmer Jeeten Thapa is a distraught man after rising costs and plunging earnings brought his business to near ruin. It was only a few months ago that he had established Jeeten Poultry Farm in Lalitpur by spending Rs5 million.

“Poultry feed prices were increasing every day while egg prices started to drop. My layer chickens were dying and prices were also falling at that time,” said Thapa.

“Now, my farm is almost empty. I have lost my entire capital which I had borrowed from banks and relatives. I do not know what to do now.”

Many poultry entrepreneurs say they stopped production after not getting a fair price for their products and feed prices soared continuously.

“The production of poultry products dropped sharply by 30-35 percent in the past month mainly because hotels and restaurants were buying less,” said Junga Bahadur BC, president of the National Poultry Traders Association.

The National Statistics Office on Tuesday said the production of meat and eggs did not grow, causing worries about the slowing demand for protein.

According to poultry entrepreneurs, the mortality rate of poultry has been rising as a result of different diseases, and the government has not been paying compensation to the farmers on time.

“Egg production has fallen to about 3.5 million from 4.2 million a month and a half ago mainly because construction workers were eating less eggs,” said Shivaram KC, president of the Egg Producers Association.

“Consumption would have increased if building workers were employed in development and construction projects,” KC said.

“High prices of basic kitchen staples like rice, edible oil, legumes, lentils, spices and vegetables have slashed the purchasing capacity of people, and they have less money to buy eggs and meat products,” he said.

“The deeply entrenched problem of middlemen in the poultry sector has also been hurting the egg market. Consumers are paying high prices for products, but the money is not going to the farmers.”

According to Nepal Rastra Bank, the consumer price index-based inflation increased by 7.44 percent in mid-March this year compared to the same period last year. Inflation in meat and fish products increased by 3.67 percent, and in whole milk and egg products by 4.76 percent.

“A sharp rise in raw material prices has led many farmers to sell off their poultry, thus reducing output,” KC said.

“The decline in consumption has also led to a drop in farmer incomes. A crate of eggs used to cost Rs400-Rs425 wholesale a few months ago, now the price is Rs370-Rs375. The retail price of an egg is Rs15.”

Janak Poudel, central president of the Nepal Poultry Farmers Association, said, “There is no tentative data but through my observation, I can say that around 50 percent of poultry farms have been empty in the past one and a half months.”

He added, “Traders are bringing chicken through different trade points illegally which has hit the business of domestic producers. The unscientific way in which chicken prices are being fixed has also reduced the income of poultry farmers, leading them to shut down their farms.”

Poudel said that only 10 percent of the old poultry entrepreneurs were still operating as the trend of starting a farm and leaving it after a few months or years had been rising due to constant losses.

“Poultry feed producers have been frequently raising the price citing rising raw material prices. They increased the price of feed by Rs10 per kg when the price of maize rose by Rs2 per kg. The government has failed to regulate the poultry business due to which entrepreneurs are leaving it. The recession has also impacted consumption,” Poudel said.

“The price of poultry feed has increased by 20-25 percent within a year to about Rs4,200 per bag,” said Rabin Puri, president of the Poultry Feed Association.

According to him, 80-85 percent of the poultry feed produced in Nepal is made from maize and soybean oil cake which is imported from India, the United States and Brazil. The Russian invasion of Ukraine has pushed up the price of maize and soybean besides transportation costs, he said.