Dr Uday Patel is a renowned veterinarian who completed his master’s in animal Genetics and Breeding, and his first placement was with NDDB as a Class-II officer. Due to his affection for the Poultry industry, he soon shifted to the poultry industry and joined Narmada Hatcheries which is now owned by Venky’s. In 1995, he started as an independent consultant in Gujarat with the primary objective of improving the bottom line of customers and making them more profitable. In a few years’ time, he expanded his services to different geographies in India and Abroad. Today he is one of the most renowned nutritionists in the world catering to ~200 clients.
Feed formulation without Soybean and Corn
The feed commodity crisis can impact industry at any point in time and the intensity of the crisis depends on various factors like supply & demand, climate change, etc. Hence, the industry keeps on trying alternatives that are no longer unconventional. Dr Uday Patel says, “Since the soybean crisis in 2022, we are trying to use alternative ingredients more regularly. At present, regular soya costs INR 46-50 per kg while normal De-oiled Groundnut Cake with the same protein content is cheaper by INR 10 per kg than soy and DDGS (rice) is also available at a cheaper rate.”
Soymeal was introduced as a key feed ingredient in India in 1996–97. Since the soya price touched the INR 100 per kg mark, the industry was in the doldrums, but it also started studying alternative ingredients at higher levels. Dr Uday opines, “100% soy replacement is possible if the Value Conversion Ratio is considered instead of the Feed Conversion Ratio which may vary by ±5 points in FCR. Personally, I stopped using soya in layer feed formulations since it touched INR 100 per kg mark.”
He adds, “For energy sources, when corn touched INR 28 per kg, broken rice and wheat were available at cheaper rates. Moreover, corn is preferred in the layer diets for the yellow color of egg yolk, but it can also be availed by using pigments. Other than that broken rice, foxtail and pearl millet are also good sources of energy that are in regular use.”
Still, a regular supply of raw materials is an issue and alternatives are also not immune to this. Dr Patel shares various other available options available in different geographies. Like rapeseed meal, ground nut meal, blood meal and MBM which are available at a reasonable price, til (sesame) cake, and imported sunflower cake is a more common practice in Telangana and some parts of South Karnataka. The alternatives are used as per the quality and availability, maize gluten meal, is one of the best rich options at certain levels.
Insect Meal – A non-viable ingredient
In the US, the Food and Drug Administration (FDA) approved insect meal to be used in pet food and Europe also approved it for certain types of feed. But the cost of production of insect meal is a huge constraint for the poultry sector, though it is viable for pet food and shrimp feed. Dr Uday says, “Still, worldwide it is used on an experimental basis for research purposes to test its efficacy for digestibility, meat quality, and egg quality. Though now it is a well-proven nutritional ingredient, cost remains a constraint. As the input cost or larvae production cost is on the higher side so even volume will not make it feasible for the poultry industry.”
GM Feed Ingredients & Sustainability
When it comes to throughout-the-year availability of quality feed raw materials at a reasonable price, GM feed ingredient is considered a solution not only benefiting the industry but also agricultural farmers. It is important to understand its impact on sustainability.
Dr Patel shares, “As per US studies, the carbon footprint of GM crops is 1.6 -1.7 times compared to non-GM crops. Will it benefit or harm the planet? Like in the Netherlands, animal production is reduced by 30% to protect the environment, but the consumption pattern is still the same. To meet demand, the Netherlands will import from South America without considering its higher carbon footprint. Such implications would only harm the planet.”
Though the poultry industry is adopting global trends. A renowned expert from USDA mentioned that 2 decades ago, Europe adopted antibiotic reduction; 5 years later, the USA started following it and now the whole world is following the trend. But this will not happen with GM ingredients, which is more geo-political rather than science based.
Antibiotic Microbial Resistance (AMR)
The antibiotic withdrawal period is being followed in India for a long time in the poultry, buffalo, goat, and shrimp & fish sector. Still, there are media reports which suggest otherwise. Dr Uday shares that even in the US, 60% of broilers are raised as antibiotic-free or no antibiotics ever production, and the rest is not, as premium claims for antibiotic-free are not affordable to everyone. India is a price-sensitive market, more than 95% of consumers prefer affordable poultry products, hardly 1% is a niche market where a premium can be claimed, and the rest 4% is an occasional consumer of organic or antibiotic-free products.
He further shares, “Two decades ago Europe banned 2 antibiotics used for animal production and yet it is not concluded whether the susceptibility of antibiotics to human bacteria is improved or not.”
When there is more supply than demand in the market, the whole industry suffers, and it gets corrected naturally if not manually. Dr Patel shares, “For the last 3 decades, I observed a 5-year cycle in the poultry sector where 1 year the industry earns profits followed by an average performance in the next 2 years where efficient industry players sustain, and then 2 years of crisis where players without strategic planning suffer a setback and may declare force closure from the industry. The industry is struggling for the last 2 years, can improve in the coming 3-6 months if there is no other disease outbreak or shock.”
Mapping of Supply & Demand
There is always uncertainty about the production & consumption of poultry meat & eggs in India. Is there any way that we can map this supply & demand? Dr. Uday says, “There is only one country on the world map that can map supply & demand which is Canada. During the COVID-19 period, they asked to close 40% of facilities of animal production and restricted both supply & demand. Hence, managed placements and selling prices, cannot be replicated unless we have strategic control.”
Impact of Consolidation
With consolidation, there is a lower cost of production as the input cost and coordination cost go down. Dr Patel admits, “With cut-throat competition, players will opt for the required margins only and hence, consumers are to benefit. Big giants like Venky’s, Suguna, IB, Sneha, Shalimar, etc. are future leaders who can control the whole process, starting from breeding up to finished products like ready-to-eat or ready-to-cook. It is tough for companies like Licious which procure from various sources and cannot control the quality of the final product.”
Venky’s, Baramati, Godrej, Shalimar, IB, Sneha, etc. have set an example in terms of branding, with franchise outlets, own outlets, an online presence, home delivery services, and supplies to most of the restaurants across regions of India. Though processed or frozen chicken, demand is still the same as that of 2 decades back i.e., 5 percent.
A new era of Poultry Farming
After COVID-19, the industry has gone through many ups and downs, many farmers have become financially weak, and many have withdrawn. Dr Uday updates, “A new phase is also coming where big farmers are planning their own farms rather than contract farming which has many benefits like better quality control, better disease management, and others. It has been a stable phase for contract farming but now it has started to reverse a bit.”