November 25, 2010

Indian poultry sector soars with rising demand

Despite sharp increase in production costs, India's poultry sector is poised for a 10%-12% layer growth and 15% broiler growth on prospects of higher consumption.

Revenue-wise too, the INR55,000-crore (US$12.02 billion) industry might register a growth of 15% this financial year.

Estimates have put layer population in the country at 18-20 crore and 20 crore monthly replacements of broilers.

"We expect growth rates of 10%-12% in layers and 15% in broilers against 6% last year. We see a steady growth in consumption with income levels and awareness going up. The consumption might go up by 10%-15% this financial year," said Mr K Mohan Reddy, President of the Hyderabad Layer Farmers' Association.

Increase in production costs, however, could reduce margins. "Cost of maize went up to INR1,000-1,050 (US$21.86-$22.96) a quintal against INR700 (US$15.30) last year. Prices of soya went up to INR19 (US$0.42) a kg against INR14 (US$0.31) last year and INR10 (US$0.22) the year before. As a result, cost of production could be in the range of INR2.15-2.30 (US$0.047-$0.050) an egg," he said.

Mr P. Chakradhar Rao, Treasurer of Indian Poultry Equipment Manufacturers' Association (IEPMA), said India's cost of production was very low thus giving the industry an edge over others.

Mr Subbaraju, Zonal Chairman of NECC, said that prices of pulses would rule above INR1,000 (US$21.86) a quintal and that the industry would have to live with it. "With prices of eggs and chicken going up, the industry could expect good growth rate. Egg is emerging as a cheaper option for families as prices of vegetables continue to go up," he said.

IEPMA has said it would organise a three-day meet beginning November 24 in Hyderabad. The association said the expo would showcase latest technologies targeting different stakeholders in the poultry industry.