One of the silver spots in the otherwise gloomy agricultural scenario in our

country is the Poultry Industry. This sector has been growing at more than

10% per annum and has the potential to grow more at more than 15% if

only they can securitize their feed requirement at competitive prices.

More than two decades back I was discussing with a friend   as to how he

saw the Soymeal and corn exports going forward.  His reply was that India

within five years will cease to be a net exporter of meal and corn and may

actually start importing the same.  His words though prophetic did not

come true till 20 years later (still partly).

Contrary to all predictions in the past the Soya crop continued to grow

from strength to strength.  In due course of time Soya industry became its

own worst enemy as more capacity started chasing too few beans. The

crop increase started plateauing and Soya industry is being pushed to the

wall and is fighting a losing battle. The plight of Soya industry is

being felt by the Poultry industry as well by way of ridiculously

high prices for meal which have no co-relation to international

values.

Corn

The story of corn is relatively better but the writing is on the wall and

going forward availability is going to get tighter and tighter.

Soya crop at around 9/10 million and corn at around 22 /23 mln tons and

not growing should ring alarm bells in poultry industry.  The period of

complacency is over and the industry will have to seriously start

looking at the future unfolding scenario and calibrate their

responses accordingly.

Rising income levels and change in food habits is resulting in more people

shifting to protein rich diets.  No wonder the poultry sector is growing at a

healthy clip of 10% and in future has the potential to top 15% growth. The

current requirement of Soya meal for the animal feed sector is in excess

of 4 million tons and growing year after year.

On the one hand we have growth in domestic Consumption of

Soya Meal and on the other the availability of the same is

shrinking. This is in spite of the fact that our meal exports have

practically become zero.  Soya crop which used to be closer to 10 million

tons is now being talked about at 8 to 8.5 million tons. With farmers

becoming reluctant sellers in view of diminishing returns the bean

availability for crushing industry is negligible.  No wonder the poultry

industry has to fight for securitizing its meal.

The situation of corn is relatively better and supply still outstrips

demand, but for how long?  We understand about 60% of the corn

produced in India goes for the animal feed sector.  The poultry sector

consumes about 44% of corn produced in the country.  With India

producing about 22/23 million tons of corn we are still not in trouble.

However this situation can change dramatically in next few years as with

few big plants coming up for producing starch and ethanol and demand

for animal feed also skyrocketing.

Till now our country has been able to provide both Soya Meal and

corn for the feed industry albeit at very high prices compared to

world values.  Question remains whether we would be able to

meet demand going forward or not.

 As the cities are urbanizing and population is migrating in search of

better living standards food habits are changing big time. Analysts tell us

there is a direct co relation between increase in wages and shift of family

from consuming staple based diets to a high protein one including fruits

and vegetables as well as dairy and meat.  This point is corroborated by

the fact that in 2006 calorie requirement from livestock was 184 which

will grow beyond 300 by the end of next decade. The writing is very clear

on the wall; the next decade belongs to Poultry and Feed Industry. 

Whether the supply of feed ingredients would keep pace is a

moot question?

We have tried to develop different scenarios and the potential

requirement of Soya meal and Corn by 2025.   Some basic

assumptions are as below:

–     Requirement has been plotted on basis of 12 and 15 % growth.

–     Soya Meal inclusion in broiler is assumed at 25% and in layer feed at

30%.

–     Corn inclusion in broiler feed is assumed at 60% and in layer feed at

50%

–     Consumption growth of Soya and corn in other sectors like human and

industrial is assumed at 10%

–     Exports have been assumed as Zero

On the basis of above assumptions the picture which emerges is really

scary and should shake up the policy makers from their deep slumber. 

The total requirement of Soya beans and corn for taking care of domestic

consumption including Poultry is as below.