The Hindu Business Line reports that egg prices are also increasing and are likely to peak around the Diwali festival in November, according to industry sources.

Short supply in tandem with rising demand has contributed to the upswing in poultry product prices, the sources said.

A representative of the Broiler Coordination Committee (BCC), an industry body that sets the price, said the BCC had fixed the farm-gate price at ₹120/kg (live bird) on Wednesday. But following "stiff resistance in the market", it is cutting back by about ₹10, he said.

However, the record high of about ₹200-240/kg in the retail market in Chennai has caught the industry by surprise. This is the trend across major cities in the South, he acknowledged.

The BCC expects the prices to sober down in the coming days. The high retail price is more a ‘knee jerk’ reaction to the overall trend and is bound to come down, he felt.

However, trade sources expect the high could likely sustain at least until Diwali when demand peaks. Poultry farmers had cut back on stocking their farms because of the Kerala floods, which hit consumption there.

The neighbouring State is a major market supplied from the western parts of Tamil Nadu. Also, this was followed by the ‘Navaratri’ festival season, when people generally go vegetarian for about a month.

Normal production is about 8,000,000 birds a week in Tamil Nadu, a major production centre. BCC estimates the drop at about 7,000,000 birds.

According to the National Egg Coordination Committee, egg prices are also buoyant and the increase is likely to sustain for some more days. “Prices are still in the negative for us,” an NECC representative said.

Demand is rising after the low during the festival season. The NECC set price in Chennai is ₹4.15 a piece as compared with ₹3.55 at the beginning of this month. In Bengaluru it is ₹4.05 (₹3.62) and Hyderabad, ₹3.83 (₹3.42).

GBP£1=INR₹94.74