Poultry Industry to Face Feed Ingredients (Maize and Soybean Meal) Supply Challenges in coming Years – Ricky Thaper, Poultry Federation of India
To sustain growth in the poultry sector, the government must ensure supplies of feed ingredients at reasonable prices, which should be ensured through liberalising imports and augmenting production.
Livestock rearing is one of the most important economic activities in rural areas, contributing significantly to the economy. The livestock sector, although half the size of crops, plays a crucial role in driving agricultural gross value added (GVA) growth. This sector is contributing to the economy in a big way, considering the higher rate of growth of the sector in comparison to the agriculture sector.
Presently, the GVA of the livestock sector has recorded an annual growth rate of around 6% at constant prices. The growth of the sector is greater than the crop sector growth rate, which was 1.65% annually. Its contribution to Indian agriculture and economy is increasing steadily, with a share of 30.47% in agriculture and allied sector GVA and 4.75% in the country’s total GVA.
According to basic animal husbandry statistics, in 2023, out of the total meat production of 9.77 million metric tonnes (MT) in 2022–23, the share of poultry meat was 4.99 MT, contributing 51% of total output. The growth of poultry meat production has increased by 4.52% over the previous year. According to the Food and Agriculture Organisation, India ranks 8th in the world in terms of meat production. The poultry sector in India is valued at more than $28 billion in 2021–22, according to the Confederation of Indian Industry’s (CII) vision document, 2047 for the Indian poultry sector, released recently. Over the years, the poultry sector in the country has witnessed remarkable growth, with chicken meat growing at an annual growth rate of 8% in the last 15 years (2006–2022), the report stated.
With rising disposable income and population, the demand for poultry products, including chicken meat and eggs, has been on the rise. The sector has capitalised on this opportunity and expanded its production capability to meet growing consumer demand. This significant transformation in the poultry sector has been attributed to the commercial poultry industry, which accounts for 85% of the total poultry production, and backyard poultry, which contributes 15%. The sector has witnessed a shift from the traditional backyard poultry models to a model production technique including integrated farming systems, contract farming, and value chain integration.
As the share of the meat and egg eating population has increased by 6% between 2015 and 2021, according to the national family health survey (V, 2021), the demand for poultry and other products is set to increase further. Currently, the per capita consumption of poultry products in the country (94 eggs per annum and chicken meat consumption is 4.2 kg per annum) is very low as compared to the Indian Council for Media Research’s (ICMR) recommended consumption level of 180 eggs and 10.8 kg of poultry meat per person per annum. There is a need to bridge the gap between availability and requirements with large-scale awareness campaigns. In order to bridge the gap between availability and demand, there is a need to scale up both the layer and broiler industries.
To enhance the efficiency of the poultry sector, several measures are being undertaken to improve genetics and disease resistance breeds of poultry, disease prevention and surveillance, and the supply of affordable feed, which constitutes 65% to 70% of the cost of production of meat. While stating that the domestic poultry industry is likely to grow at a steady pace of 8%–10% in 2023–24, consulting firm ICRA stated in March this year that earnings of poultry companies are expected to be volatile owing to fluctuations in raw material or feed costs, especially maize. ICRA has stated that due to rising worldwide demand for Indian maize as a result of the Russia-Ukraine conflict and increased exports from India, maize prices have grown significantly by 32% on a year-on-year (YoY) basis in 2022–23, resulting in an increase in the average feed price.
Poultry feed mostly consists of maize, Bajra or broken rice (60-65%), soybean meal (30-35%) and nutrients. The mandi prices of maize because of rising demand for industrial use is ruling much above the minimum support price (MSP) of Rs.1962/quintal announced by the government for 2022-23 and Rs.2090/quintal for 2023-24 kharif season. Stating that there has been increasing diversion of maize towards industrial use and ethanol production, “the current growth level of maize and soybean production in the country will be insufficient to meet the demand of the poultry industry.” As the government plans to promote use of maize for ethanol, the poultry industry can face challenges in getting maize for feed. The Food Corporation has already stopped supplying broken rice to ethanol makers and prices of broken rice have risen sharply in the last few months.
Several poultry and livestock industry associations, including the All India Poultry Breeders Association, the Compound Feed Manufacturers Association, the Poultry Federation of India, and Vets in Poultry, are now pleading with the government to allow imports of GM maize and soybeans because of an ‘unprecedented increase’ in prices. Regional Poultry Associations have also urged the central government to reduce import duties on maize and soybeans to deal with feed supplies. The industry feared that the prices of maize and broken rice would spike in the coming months as the diversion of these raw materials for ethanol production is expected to increase as the government has reduced the allocation of sugar for biofuel production.
In August 2021, the government relaxed import rules to allow the first shipment of 1.2 MT of genetically modified (GM) soymeal to support the domestic poultry industry after a record spike in feed prices. The poultry industry has earlier said the government should allow both the import and cultivation of GM soybeans and maize to fulfil the requirements of these two major feed ingredients in the coming years. Sustainable supplies of feed ingredients in the coming years would be crucial for the growth of the poultry industry.