Demand for poultry feed in India has been consistently increasing on account of rising population, increasing per capita income and hence demand for healthy poultry products such as broiler meat and surging demand for compound poultry feed. Broiler poultry feed segment dominates the overall poultry feed market in India. Over the last few years, an increasing number of poultry feed manufacturers in India have been focusing on enriching feeds with prebiotic and probiotic supplements to enhance productivity and quality of poultry products. Furthermore, growing trend of contract farming has also been contributing to growth of country’s poultry feed market.
Increasing household incomes results to improved animal-based protein intake and broiler meat has an advantage of being a healthier choice versus red meat like mutton, pork and beef, as it comes under the white meat category. It is cheaper than seafood as well. Estimates show that India’s per capita consumption of broiler meat grew by a 7.4 per cent compound annual growth rate (CAGR) from 2009-10 to 2013-14, while egg consumption rose by 3.7 per cent CAGR. The per capita consumption of broiler meat is estimated to grow by a slower 6 per cent CAGR from 2013-14 to 2017-18, while egg consumption might improve slightly to 3.9 per cent CAGR, going by the research data.
The poultry industry has been expanding at a rapid pace in Southern India, major growth coming from Andhra Pradesh, Karnataka and Tamil Nadu which presents ample opportunity for individual feed players. Current demand for poultry feed in India is estimated between 21 and 23 million tonnes. Poultry feed accounts for nearly 60 per cent of the total feed market in India and it have a potential to grow by 7 to 8% in next few years.
Domestic broiler industry has been considered the strongest driver behind the development of feed industry in India, and has benefited significantly from the presence of integrators (which is nearly three fourth of the total industry size), in addition to a shorter production cycle. As a result, the Indian poultry industry could achieve feed based efficiencies and rationalization. Roughly 90 per cent of the broiler industry uses compound feed and India is the fourth largest broiler producer and third largest egg producer. Having said that, compound feed in the layer industry remains highly underutilized and usage varies from 5 per cent to 25 per cent. Total feed demand is estimated at approximately 11.5-11.8 million tonnes, based in the current egg production. Future offers a promising growth potential for layer feed industry.
Entry of more organized players, higher integration in the poultry feed industry in addition to stable feed prices will be seen as drivers for growth of poultry feed industry in near future.
The total feed demand is currently expected to be around five to six per cent in context to the egg industry. Studies revealed significant opportunities in egg industry for compound feed demand in the near term. Feed grain demand was largely under threat due to improving chances of a bird flu during the last quarter of 2015. USDA’s global feed demand estimates for the 2014/15 season were steadily adjusted higher from July 2014 to July 2015, a whopping upward revision of 16 million tonnes.
The last few years have observed consistent increase in the demand for animal protein worldwide, including for livestock, dairy and fish. Growth of production particularly in the developing world was more prominent while developed countries showed more or less stable growth. As per the United Nations Food and Agriculture Organization (FAO) the demand for food by 2050 might grow by 60-62% and that between 2010 and 2050 production of animal proteins is expected to grow by around 1.7-1.8% per year. Meat production is projected to rise by nearly 70-71%, aquaculture by 89-90% and dairy by 54-56%. The growth figures imply that production might double by that period.
Industry is quite optimistic about the scope of feed business, due to improving growth prospects in the sector. At the same time it is getting more organized. With the current growth rate, India can soon turn out to be the largest feed market in the coming years.It is noteworthy that the feed industry requirements that are met with the compound feed are only 11 per cent, 14 per cent for aqua feed and 55 per cent for poultry feed. Experts share that in next 5 years, the feed demand from broiler sector will grow at a rate of 6-8 per cent, for layers feed by 4-6 per cent; for cattle feed by 5-6 per cent while demand for aqua feed might grow sharply by 9-10 per cent.
Currently, poultry sector (including broiler and layers) consumes around 12-13 million tonnes, and consumption in next five years is expected to increase to 22 million tonnes. Similarly cattle feed consumption is averaging around 7-8 million tonnes, and there are projections for the number to increase to 67 million tonnes. On the other hand aqua feed consumption is likely to grow significantly from 1 million tonnes to nearly 7 million tonnes.
Summing up, there is immense potential for animal feed business in India and with improving income and increasing animal protein demand, there will be a higher requirement of processed dairy, aqua and poultry product; and hence increased requirement of animal feeds. The trend is expected to have better impacts in Chinese and Indian markets. The per capita consumption is also projected to remain high in the European Union, North America, Brazil and Russia. A number of initiatives including silage, green fodder, hydroponics and bypass protein feed etc are already taken for better production. Still there is an immediate need to further increase the capacities of Indian animal feed industry, since the multinational firms are constantly seeking opportunities to enter in attractive Indian market. The tables given below are for demonstrating global trends.
Tables are available on request: