DYNAMICS AND PATTERNS OF EGG PRODUCTION, PRICES AND TRADE IN INDIA: A SPATIO-TEMPORAL ANALYSIS 3757
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Date
2023-09
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JAU JUNGADH
Abstract
India is the second largest producer of poultry eggs with a share of nearly 6
per cent of global egg production. The present study was conducted to analyse the
growth rate, instability, growth pattern and forecasting of egg production, price and
export and also market integration and price transmission among the major egg
markets. The major egg producing states were selected based on the egg production
volume and the state of Gujarat was also selected. Ten major egg markets across the
country were selected based on the egg transaction volume. Time series data was
collected on all-over India egg production from 1961-62 to 2021-22, major state-wise
egg production from 1997-98 to 2021-22, average monthly wholesale egg prices from
January 2009 to December 2022 and egg exports from India from 1986-87 to 2021-22
from authenticated sources. To fulfil the objectives of the present study, the best
econometric and statistical tools such as Compound Growth Rate, Cuddy-Della Valle
Index, centered twelve month moving average method, Engle-Granger and Johansen
cointegration analysis, Granger causality test, VECM, Impulse response function,
Variance decomposition, ARIMA and SARIMA models were employed in this study.
The overall period growth rate and instability of egg production in India were
6.23 and 38.83 per cent respectively. Among the major egg producing states, the
highest growth rate and instability in egg production was achieved in Haryana
(10.87%) and West Bengal (25.29%) respectively in the study period. The overall
month-wise growth rate of nominal egg prices in all the selected markets in India was
positive and highly significant at 1 per cent level where the highest and lowest growth
rate was achieved in Barwala (2.41%) and Chennai market (1.27%) respectively. The
overall instability shows that the price volatility was high in Barwala market and low
in Namakkal market. The overall month-wise growth rate of real egg prices was
highest in Barwala (2.44 %) and lowest in Chennai market (1.31 %) whereas
instability was highest in Barwala (10.38 %) and lowest in Namakkal market (5.76
%). The market-wise growth rate of egg prices in selected markets showed that a very
high growth rate happened in Barwala market in 2020 (8.54%) and a very low growth
rate in Chennai market in 2010 (0.60%) whereas the instability was highest in
Barwala (5.78%) and lowest in Mumbai (3.78%) market. The growth rate and
instability of egg export quantity, nominal and real value of egg exports and unit price
of egg exports were also analysed in this study. The overall period growth rate and
instability in the quantity of eggs exported from India were 10.34 and 65.84 per cent
respectively. The growth rate and instability in the nominal value of egg export in the
study period as a whole were at 18.70 and 32.26 per cent respectively whereas the
overall growth rate and instability in terms of the real value of egg export were at 12.5
and 57.97 per cent respectively. The growth rate and instability of unit price of egg
exports (Nominal) in the study period as a whole were 7.57 and 27.59 per cent
respectively whereas the growth rate and instability in real unit price of egg export in
the overall period of the study were at 1.95 and 30.69 per cent respectively.
The seasonal indices showed that in all the markets the highest egg price
indices were seen in November or December month and the lowest indices were seen
in April month. The stationarity test showed that all the selected egg markets attained
stationarity at their first difference. The optimum lag order was selected as 3 which is
devoid of autocorrelation. The Engle and Granger test showed that all 45 market pairs
were integrated. The Johansen cointegration method shows that all the selected 10
major markets were integrated in the long run. The VECM shows that the speed of
convergence of short-run disequilibrium towards long-run equilibrium will be faster
in Barwala market (7.18 %). The LOOP does not hold for the selected egg markets.
The Granger causality test revealed that the Barwala market granger causes all
other markets except Bangalore market and it is not granger caused by any other
markets. Barwala market acts as a price leader among the selected egg markets,
exhibiting a strong exogenous effect. The impulse response function showed that the
response of the markets to one-unit standard deviation shock given to other markets
disappeared mostly after period 9 or 10. The variance decomposition analysis showed
that the Barwala market is the major influencer of egg price in other markets both in
the short run as well as in the long run and it is the major influencer of its own price.
The ARIMA (2,1,4) model is the most suitable model for onward forecasting
of egg production in India. It predicts a rising trend in egg production in India,
projecting an increase from 73.75 lakh tonnes in 2022 to 97.69 lakh tonnes in 2026.
The SARIMA (4,1,4) (2,1,1), (4,0,4) (3,0,1), (6,1,4) (1,1,1), (6,1,4) (1,1,1), (3,1,4)
(2,1,1), (4,1,3) (1,1,1), (5,1,4) (1,1,1), (6,1,4) (1,1,1), (5,1,3) (2,1,1) and (6,1,4)
(2,1,1) models were selected as the best models for forecasting egg prices
Ahmedabad, Barwala, Bangalore, Chennai, Delhi, Hyderabad, Kolkata, Mumbai,
Namakkal and Visakhapatnam markets respectively where it forecasted that the egg
price in 2023 will be higher in November or December month and lower in March or
April month. The ARIMA (4,1,5) model is best for onward forecasting of egg exports
from India which forecasted that the egg exports from India will be in increasing trend
up to 2023 and then it will decrease in 2024 and after that it will start to increase