Budget 2020 highlights for Poultry and Dairy Industry

The sheer scale of people who are associated with agriculture is so high in India that irrespective of the trend of contribution of agriculture in overall GDP, the focus of any Govt to ensure its wellbeingcan’t be undermined. In that perspective this budget was no exception. Generation of sustainable income for the farmers through sustainable cooperation through agriculture development beaded through 16 action points, had been the main highlight of budget.
As they say, no matter how good you get you can always get better, and that’s the exciting part. In this budget as well, there had been some aspects which look interesting for Poultry and Dairy industry which can be summed as follows.
The emphasis and stronger will of Govt on incentivizing to go solar is worth noticing. Pradhan Mantri KisanUrja Suraksha and PM KUSUM are proposed to be expanded and its projected to provide 20 lakh farmers in setting up stand-alone solar pumps. This goes in direction of not only sustainability but also towards production with cost optimization for both poultry and dairy farms.Its worth being noticed, more so by poultry farms for embracing, as the payback period of investment on this will become shorter.
One of the important aspects to increase the consumption behavior of the end customer is to make the products and value-added products available at last mile spread. This trend is catching up in consumption behavior of most of the food and FMCG sector products. To facilitate the ‘first mile procurement’ and ‘last mile availability’ of milk and poultry products, the initiative of Govt for building seamless national cold supply chain with Indian Railways setting up Kisan Rail through PPP arrangements, is indeed a good move. The addition of reefer coaches in express and freight trains will also support the poultry and dairy industry players in product movements and facilitating optimization in logistics cost.
For dairy, a noteworthy direction of Govt is to facilitate doubling of milk processing capacity from 53.5 MMT to 105 MMT by 2025. This is in sync with the very clear lining on the wall which loudly says that the whole dairy market is impressively shifting towards value added milk and milk products. Considering it as a future trend, in past couple of years most of the large scale private milk aggregators as well as milk cooperatives had been aggressively investing on CAPEX of processing. As processing is highly capital-intensive activity, therefore this initiative of Govt will be further benefitting the industry to go all the more aggressive on this line which in-turn will propel the industry towards value added direction.
One of the ongoing issues with Poultry and Dairy industry is non predictive availability and pricing of raw materials. Last year, it had impacted the industry a lot and for this year as well, we are keeping our finger crossed. Some concrete policy decisions are solicited on this aspect from Govt to add more confidence of poultry and dairy farmers as well as overall industry.
by Dr (Capt) Tanweer Alam, Kemin South Asia Pvt Ltd