Excess of production in India approximately 40% surplus, coupled with compounded impact of COVID 19, social media bombardment, sentiments related to chicken and virus attacks, have made the poultry industry to lose approximately 15 billion in few weeks only. It is fairly assumable that when our trade of live chicken is more than 96% of total production in the year annually countrywide, industry needs to restructure itself to combat such unprecedented climb down. The situation calls for strategic planning to determine the size of the market and adjust the feed production accordingly. This is an activity that must be done “In pack” all companies under a professionally managed association. Normally in India companies do not trust each other, therefore hiring a neutral entity such as an auditing company or auditors/management will replace their distress. Benchmark information must be sent to these companies to settle their production in detail, and must be available with every company. So, the company of auditors or association will be in a condition to estimate future quantities that the market can absorb “I am certain this is not the first price crises and most unfortunately it shall not be the last”.
Industry must constitute the council of administration that will approve budget, listen to monthly analysis by auditors/association and not according to individual imaginations. Every player must be committed to it. I am fairly aware many feed companies will not accept this proposal, However, those companies which do not join together, are more likely to disappear. We are very well aware poultry sector will be a low margin sector where feed represents more than 70% of our cost and we do not determine the price of soya beans or maize. The general rule predicts that some companies may disappear and few that survive shall concentrate the activity. There would be always fight for glory of growth but the aim of the companies must be survival. “Making Money” “Expansion” “profit” are the denominations of side benefits of survival than nurturing the industry and cooking the pie together in order to fight for your piece afterwards.
I am very much aware if majority will not accept the concept of “Hunting In pack & Defending In pack”, well then the remaining option “Redo some and wait for few of them to disappear” , Anyone who has a power of doing more, cries less, so wait for those that cry less to emerge”.
Getting rid of the excessive unplanned production in the market.
- Size the market and establish a figure of eggs and chicken that can be sold and not “Given Away” through cries. It gives the excessive stock at the cost of expanding consumer base by strategizing and making chicken and eggs available to those who find difficult to afford our products because of retail price burdens but do not reduce inventories through market channels because that will perpetuate losses and lower prices.
- Reduction of inefficient laying eggs and breeders immediately with below average efficiency and reducing the placements to create judgmental gap which will bring the situation under control, but as I said earlier, the united approach is the only answer and therapy to this crisis. Of course, WALKING DEAD will not help anyone presently.
by OP Singh, Huvepharma