India's rising appetite for poultry products will boost domestic demand for animal feeds corn and soymeal this year by about 9 per cent, traders said on Thursday.
The higher local feed demand could further reduce overseas sales that are already under pressure from cheaper grains from Latin America. India, however, is still the leading seller of corn and soymeal in Southeast Asian markets. Domestic demand for the two main feed grains are expected to rise by 9 per cent to 12 million tonnes as demand for products such as eggs and chickens rises in India, the world's fifth biggest producer of broilers.
Corn will make up most of the feed demand growth because supplies are ample and prices cheaper. Demand for soymeal may not rise as prices surged after late rains hit the soybean crop.
"Consumption of feeds, mainly corn is expected to increase because demand for poultry products are likely to rise by at least 6 per cent this year," said Sanjeev Chintawar, Business Manager, National Egg Coordination Committee.
Demand for corn could rise by at least 1 million tonnes to 9 million tonnes this year; demand for soymeal is seen almost flat at 3 million tonnes. In domestic markets, corn was quoted at 12,000-13,000 rupees ($193-$209) per tonne, much cheaper than soymeal at 34,500 rupees ($554) per tonne. Soymeal prices are up 18 per cent from a year earlier due to the poor harvest.
"We expect about one million tonnes per month demand for corn and soymeal over the next two months," said Ricky Thaper, an official of the Poultry Federation of India. He said the monthly demand for corn would be 750,000-800,000 tonnes, while demand for soymeal would be 200,000-250,00 tonnes.
Thaper said demand for poultry products is growing 7-8 per cent a year due to preference for cheap sources of animal protein in Asia's third largest economy. Poultry is the leading animal protein in India as beef and pork are discarded due to religious reasons despite lower prices. Fish and lamb are available but more highly priced.
India's per capita chicken meat consumption is 3.1 per kilogram against the global average of 10.5 kg. Traders expect the consumption to nearly triple to 9.1 kg by 2030.
Taiwan-based company Charoen Pokphand will set up five modern units including feed mill in the field of poultry and pig farming with capital outlay of Rs 571.20 crore.
A memorandum in this regard was signed between Punjab government and the company here today, said an official release.
A spokesperson of state government said that a delegation of Charoen Pokphand (Thailand) Company led by its Vice-Chairman Chaiyaporn Montha called on Punjab Chief Minister Parkash Singh Badal at his residence this afternoon and apprised him company's decision to invest in Punjab.
As per plan, the company will set up a feed mill at a cost of Rs 120 crore, a hatchery at Rs 24 crore, a breeding farm at Rs 102 crore, a broiler farm at Rs 324 crore and a swine farm Rs 1.2 crore in the state, release quoting Montha said.
The CP Group intended to commence commercial production by the year 2014 and complete the proposed investment by the year 2018.
Badal assured the company that the government would extend full support and cooperation to the company for further setting up their operations in the state.
He also asked them to initiate some project in the field of fishery particularly in the waterlogged areas of Punjab.
Regarding the issue of importing animals for setting up of a swine processing unit in Punjab, Badal said that this issue was under the jurisdiction of the Union Government.
However, he offered that in this regard the state would write to the Centre in favour of the company whenever needed.
He said that SAD-BJP government was fully committed to boosting allied farming in the state to enhance the profitability to the farming community.
Over 400 companies across various sectors are likely to participate in the forthcoming agricultural event, Progressive Punjab Agriculture Summit-2014. This is the first time in the history of Punjab that a mega agricultural summit is being organised by the state government. The event organised in association with PHD Chamber of Commerce will be held from February 16 to 19 in Mohali.
Director of PHD Chamber of Commerce Dalip Sharma said the forthcoming summit is being held with the objective of reaching out to farmers through stakeholders of technology. Companies such as Mahindra & Mahindra, Monsanto, Bayer Crop Science, ITC, BCS-Ferrari, Dabur India, Pepsico, Tata Chemicals, Syngenta, Godrej Agrovet have already confirmed their participation.
In addition to national companies, firms from Holland, Italy, Israel, Taiwan and South Africa will also participate in the summit. A mega state pavilion is to be created at Agri-Tech 14 that will offer opportunities to nodal agencies, corporations and government department to showcase their success stories through attractive displays. The state pavilion will also play host as many as 12 other states.
Further, the summit would introduce live demonstrations and exhibit cattle farm stalls over an area of about 100 acres.
The exposition will have four categories, namely AgriEx, LivestockEx, FoodEx, FarmEX. In AgriEx category, companies in the field of chemicals, bio-technology, implements, irrigation systems, fertilizers, pesticides seeds, etc. will showcase their products. While LivestockEx will showcase dairy management, poultry management, fishery management and livestock management. Technology related to processed and packaged food, packaging, ingredient research will be showcased in the FoodEx group and tractors, farm equipment, machinery storage and farm power will be displayed by the FarmEx group.
It is expected that world class agriculture equipment/machinery manufacturing companies would display their products in the exhibition to benefit the farmers and give impetus to the agro-based economy of the state and to elicit maximum participation of renowned agriculturists, agri-experts and progressive farmers from across the globe.
The state government will soon prepare an action plan for growth of the poultry sector. On Saturday, fisheries and animal resources development secretary Bishnupada Sethi held a discussion with senior officials in this regard.
This followed chief secretary J K Mahapatra directing the fisheries and animal resources development department to chalk out a plan in step with a suggestion from the Centre, official sources said.
Earlier, the Union animal husbandry, dairying and fisheries ministry had told the state government it was going to unveil a National Livestock Mission (NLM) programme this fiscal and advised the latter to prepare an action plan for poultry sector, sources said.
Official sources said Union finance minister P Chidambaram, in his budget speech in February, had promised launching NLM in 2013-14 with an investment of Rs 307 crore. The mission would aim at supporting poultry, dairy farming and fisheries, which are critical for small farmers to maintain a steady income when crops fail.
In 2011, the state government had drawn up an ambitious plan to boost fisheries and animal resources development sector, including poultry. The department's Vision-020 document not only aims at achieving self-sufficiency in milk, egg and meat production, but also becoming a state surplus in livestock productivity by providing sustainable livelihood to the poor, sources added.
India on Tuesday declared itself free from the highly contagious avian influenza or bird flu that may augur well for the country's poultry sector, promising boost to exports.
It will help traders to tap overseas markets for poultry products as the outbreak of bird flu in certain parts of the country three months ago had led many countries to impose ban on imports of such consumable items from India.
"India has declared itself free from notifiable Avian Influenza (H5N1), commonly called bird flu, and notified it to the World Organization for Animal Health (OIE)," said an official statement of the department of animal husbandry under the agriculture ministry.
It, however, emphasized that even though India was free from bird flu, regular surveillance to be continued throughout the country "especially in the vulnerable areas bordering infected countries and in areas visited by migratory birds".
Bird flu affects mainly the domestic poultry (chicken, duck etc). "Very occasionally, humans may also be infected with this virus when they come in close contact with infected poultry and their droppings," says the manual of the All India Institute of Medical Sciences (AIIMS) on H5N1 avian influenza.
It explains that the disease spreads from infected birds to other winged creatures through contact with nasal and respiratory secretions and also due to contamination of feed and water.
India had notified outbreak of bird flu at Poultry Production Unit, College of Veterinary Sciences and Animal Husbandry at Anjora in Durg and Government Poultry Farm at Jagdalpur in Chhattisgarh on August 5.
The Centre had subsequently alerted states and Union Territories to take all possible precautionary measures to contain the spread of avian influenza. The directive led to heavy loss to poultry farmers as government agencies had to destroy the birds in substantially high numbers to prevent an outbreak.
The measures are stamping out of entire poultry population including destruction of eggs, feed, litters and other infected materials in the radius of 1km around the outbreak location, restriction on movement of poultry, disinfection and cleaning up of infected premises and subsequently issuing of the Post Operation Surveillance Plan (POSP).
The POSP was issued by the government on August 12.
A team representing officials from the Ministry of Regional Municipalities and Water Resources (MRMWR), the Ministry of Awqaf and Religious Affairs, Muscat Municipality and the Public Authority for Consumer Protection is in India to check methods of slaughter and processing of poultry to give farms the certificate to export their products to the sultanate.
In a decision in May this year, the Ministry of Agriculture and Fisheries lifted the import ban on poultry and its products from India but with certain clauses which makes necessary for an Indian company to get its premises and husbandry procedures verified by Omani officials first.
The new measures were taken to avoid on and off ban on poultry imports from India, which lasted about 12 months in a 15-month period before May, due to recurrent outbreak of bird flu in the country.
With the new decision, all exporting units in India must follow World Organisation for Animal Health’s (OIE) concept of ‘zoning and compartmentalisation’ for purposes of disease control and international trade.
Also, the certificate to export to Oman is subject to field inspection by a technical team from the sultanate to ensure companies honour the conditions stipulated.
The visiting team is being led by Mohammed bin Reda, assistant director-general for health and inspection, MRMWR.
The team’s week-long programme includes visits to four poultry farms producing eggs in Bengaluru, as well as meeting with the relevant government agencies with regard to export of eggs.
The team will also visit slaughterhouses and poultry processing units to see that procedures are in line with Islamic slaughter.
Speaking to Muscat Daily from India, Dr P V Senthil, secretary of Livestock and Agri Farmers Trade Association, India, said that process laid down by Oman is proactive, and if it is adopted by other countries, it will be a win-win situation for all.
“A team from Oman visited Namakkal in Tamil Nadu, which is the largest egg producing and exporting region in the country, in July and inspected many poultry farms here.
“Since then, the export of eggs to Oman has touched 40-50 containers per month (472,320 eggs per container). The latest visit by Omani officials will open doors for many other production units,” he added.
Senthil added that exports from Namakkal saw a big drop last year because of Oman ban, but with new procedures in place it is slowly getting better.
“The domestic industry incurred huge losses and is still running under losses, but it is far better placed than last year with exports to Oman now open,” he said.
The district administration has taken steps for setting up poultry farms in the wake of the Chief Minister Jayalalithaa’s recent announcement.
In an official press release issued here on Saturday, Collector Anu George, said about 230 poultry farms would be set up in the district which fell under the Villupuram zone of poultry development scheme.
Explaining the advantages of this subsidy-based programme, the Collector said farmers, individual entrepreneurs and members of self-help groups were eligible for the scheme.
One of the members of the group should possess a piece of land for setting up the shed. Persons interested in expanding their existing farms could also benefit under the scheme, the release said.
The Collector said a five day training would be imparted to the selected applicants by the Tamil Nadu Veterinary and Animal Sciences University,.
With prices of soyameal and other key feed ingredients rising, prices of poultry feed products may become dearer by the end of this week.
Lower supply and concern over crop output may push poultry feed products further up by at least Rs 100 for a 30-kg and 50-kg bag by the end of this week, said Mr Subhash Sharma, Financial Head, Sarvottam Poultry Feed Supply Centre. Soyameal prices have increased by Rs 1,100-1,150 a quintal over the last one month. On Wednesday, soyameal prices increased by Rs 400 and quoted at around Rs 4,300 . Similarly, maize prices went up by Rs 80 to Rs 1,350 a quintal.
Bajra increased by Rs 90 and settled at Rs 1,200 a quintal, DCP went up by Rs 5 and quoted at Rs 41 a kg, while fish oil sold at Rs 85 a litre, Rs 3 up from previous level.
After a price rise last week, prices of poultry feed products have been kept unchanged since then. Broiler concentrates feed quoted at Rs 1,830 for a 50-kg bag. Broiler Starter Mash sold at Rs 1,350 .
“Broiler Pre-Starter Concentrate 30 per cent” sold at Rs 1,540 for a 30-kg bag, while layer concentrate cost Rs 1,390 for a 50-kg bag. Pre-lay mash quoted at Rs 900 while broiler finisher sold at Rs 1,330 for a 50-kg bag.
Meanwhile, slack demand pulled egg, broiler and chick prices further down, on Wednesday. Broiler prices were at Rs 85-90 a kg (Rs 95). The price of an egg went down by 11 paise to Rs 2.54, while that of chick went down by Rs 7 toRs 15.
Andhra Pradesh Poultry Federation has demanded the Centre to allocate two lakh tonnes which is damaged and unfit for human consumption wheat and paddy to the poultry industry at subsidised prices.
Due to higher prices of maize and soyameal, the cost of production of an egg has increased to Rs. 3.25 and that of broiler chicken to Rs. 90 a kg, federation's joint secretary N Nageswara Rao said in a release issued in Vijayawada.
In order to save 25,000 poultry farmers, the central government should take initiatives to supply damaged wheat and rice from its stocks at subsidised prices, Mr Rao said.
The poultry federation also requested the government to ban futures trading in soyameal and maize, in the interest of poultry farmers.
It also requested the government to consider the needs of the local markets before allowing export the soyameal.
INDIA - Dearer soyameal and other ingredients have led to the prices of poultry feed products rising further.
Due to low rainfall this year, stockists have started to hold the stocks and that has driven prices up, said Mr Satpal Singh, Proprietor, Sarvottam Poultry Feed Supply Centre Pvt Ltd.
“If the monsoon fails to pick up even this week, prices of poultry feed products may increase further in the coming days,” he added.
Higher export of soyameal is also a big reason behind the rally in soyameal prices, said Mr Satpal.
According to The Hindu Business Line, soyameal has rallied and prices have increased by Rs 850 a quintal in the last three weeks. It may go up further, he said.
On Wednesday, 11 July, soyameal prices increased by Rs 100 and quoted at around Rs 3,900 a quintal. Similarly, maize prices went up by Rs 95 to Rs 1,270 a quintal.
Bajra increased by Rs 70 and settled at Rs 1,100 a quintal, DCP went up by Re 1 and quoted at Rs 36 a kg, while fish oil sold at Rs 82 a litre. Poultry feed products
Prices of poultry feed products went up by Rs 70 and Rs 200 for a 30-kg and a 50-kg bag respectively. Broiler concentrates feed went up by Rs 200 and quoted at Rs 1,830 for a 50-kg bag.
Broiler Starter Mash sold at Rs 1,350 for a 50-kg bag, up Rs 70 from its previous level.
‘Broiler Pre-Starter Concentrate 30 per cent’ increased by Rs 120 and sold at Rs 1,540 for a 30-kg bag, while layer concentrate went up by Rs 130 and cost Rs 1,390 for a 50-kg bag.
Pre-lay mash quoted at Rs 900, up Rs 70 from its previous level while broiler finisher went up by Rs 70 and sold at Rs 1,330 for a 50-kg bag.
Meanwhile, after touching a record high earlier this month, egg and broiler prices witnessed correction while chick went further up on Wednesday. Broiler quoted at Rs 95 a kg against Rs 125 last week.
The price of an egg went down by 65 paise and cost Rs 2.65, while chick went up by Rs 4 and sold at Rs 22. Buyers’ resistance is the prime reason behind the fall in the prices of broiler and egg, said Mr Satpal .
The world is fast acquiring a taste for eating chicken and this is going to offer huge opportunities for poultry producers in Europe and beyond. That was the optimistic scenario painted by Inma de la Vega, commercial director of poultry for McDonald's Europe, who outlined some current trends in the foodservice industry. She cited her own company as an example of how fashionable chicken has become. Back in 1955, when McDonald's was launched, only hamburgers and cheeseburgers were served and it was not until 1983, nearly three decades later, that chicken was finally added to the menu. "It was an instant success and we now see 5% growth in sales of chicken dishes compared with 3% for beef," Ms de la Vega told the World Poultry 2012 conference. "In fact, in the next 20 years we expect to sell more chicken than beef." There was a growing public perception, she said, that chicken was the healthier product as well as being more affordable than both beef and seafood.Turning to current and future food trends, she said that globalisation had increased consumers' exposure to foreign flavours and cuisine, with many formerly "exotic" products now part of the mainstream. And, with ever-more of McDonald's customers adopting busy lifestyles, the public was increasingly plumping for "on-the-go" options. She advised poultry industry representatives to focus very carefully on such trends in order to tap into the huge potential offered by booming chicken production and sales. EDUCATING THE CONSUMER The poultry industry has a "cracking" story to tell, but has been relatively ineffective in getting its message across to customers, according to Peter King of the 2 Sisters Food Group. "Let's be honest, we've not been great at telling our story. There is a lack of clear information in the shopper's mind about production," he told the conference. This was despite the fact that consumption of chicken had easily overtaken beef, and was rapidly closing in on pork for the top spot among European consumers. A survey carried out by 2 Sisters showed that families ate chicken at least two or three times a week, and that children ate at least one more portion than the rest of the family. Even so, he believed the industry needed to connect with the customer more effectively and provide confidence and reassurance in what it does. All too often, headlines such as "Man dies of bird flu in Far East Asia" gave a disproportionate impression of the public risk from poultrymeat, said Mr King. In order to tackle this disconnection, the poultry sector had to "sell the benefits of poultry, inform and educate". Celebrity chefs, he suggested, had fuelled consumer anxiety about food safety, once again reinforcing the need to engage more in open discussion. "We have a fantastic product that lots of consumers want, but producing a great product is not enough. Let's work together to reconnect the consumer with our modern farm-to-fork supply chain," he suggested. FACING THE THAI CHALLENGE European broiler producers and processors are expected to shrug off the return of Thai raw chicken exports to the EU market, following the removal of restrictions imposed after an outbreak of bird flu nine years ago. Dutch analyst Nan-Dirk Mulder of Rabobank, the leading Dutch-based food and agricultural bank, explained that the EU markets will reopen to Thai imports of raw chicken from 1 July, now that Thailand has successfully eradicated H5N1 avian influenza. The lifting of the curbs meant Thailand was set to use all its 92,000t quota of salted breast meat exports to the EU, which is the world's third-biggest broiler meat import market after Japan and Saudi Arabia. "This is going to be a big issue for the poultry industry and will mark a shift in global trends," he remarked. But European processors were expected to be protected from the impact by their focus on fresh chicken, while the biggest losers would be Argentina and, especially, Brazil. "The EU's fresh meat market will be relatively safe," said Mr Mulder. His overall advice to producers was to quickly adapt to the challenges posed by increased competition from emerging countries, a sentiment endorsed by James Sumner of the US Poultry and Egg Export Council, who believed India could soon overtake China as a dominant global poultry player. Mr Sumner predicted that trade issues, compounded by the emergence of possible new animal disease, would continue to dominate the industry in the coming years. "Let's remember," he told the meeting, "that while earlier consumer scares, such as avian flu, may have subsided, the incidence of HPAI infection is on the increase." FOOD SAFETY RECORD A senior EU Commission official told the conference that efforts to tackle EU-wide food poisoning have, so far, proved "very successful". Ladislav Miko, deputy director general of the commission's health directorate, said he was "very satisfied" with ongoing attempts to control salmonella and campylobacter - the most common form of food poisoning. This was partly the result of a Commission-led strategy launched in the wake of recent food scares such as avian influenza. "Our strategy has resulted in the number of human cases being reduced by more than 50%," he said. Cases had fallen from more than 200,000 in 2004 to less than 100,000 in 2010. Mr Miko said that, since the end of 2011, the two most important types of salmonella - Enteritidis and Typhimurium - were believed to be absent in fresh poultrymeat. But while biosecurity and hygiene measures had been successful in the control of salmonella, they had been less effective for campylobacter, he added. "Additional tools must be considered," he argued. He told the conference the commission had asked EU member states to carry out a survey of campylobacter in broilers. "Based on these findings, we are currently evaluating the economic and social impact of the suggested control measures," he said. On the subject of antibiotic resistance, Mr Miko said the industry itself could contribute to solving the problem, by putting pressure on poultry farms to minimise the use of antibiotics. "The purpose of our strategy is to reduce the use of antibiotics by increased awareness and prudent, justified use without jeopardizing animal health." INDUSTRY CHALLENGES Volatile feed markets and excessive red tape are among the many hurdles facing the industry, British Poultry Council chief executive Peter Bradnock told the conference. "Much of the world's poultry production depends on feed, particularly soya, imported from other regions and on access to markets," he told the audience. Market volatility was exacerbated by exchnage rate volatility, he added. The sector also needed to guard against local and narrow legislation that added costs and distorted competition in open markets. "We need to guard against the possibility of EU regulations threatening to hobble the genetic breeding programmes that have driven the success of our industry." There was evidence in Europe, and elsewhere, that the "high cost model" of government was unsustainable. "The high cost of legislation includes a high cost of enforcement, which governments can no longer afford." Mr Bradnock went on to say that the poultry industry needed to demonstrate that there were viable, industry-managed alternatives to prescriptive and costly official regulations. His key message to delegates was that the whole industry had to take a lead in tackling these and other issues. MARKET VOLATILITY Fluctuating feed costs may not be the only commodity risk facing poultry firms, but it forms by far and away the biggest threat to company profit, accounting for 60% of the cost of the finished product. And according to Jane Biss of Bernard Matthews Farms, such volatility is set to continue, and perhaps get even worse, in the foreseeable future. "Those of us who have been part of the meat/feed industry for a number of years will be able to remember back to the easier, less volatile market of six years or so ago," she said. "Prior to that, market prices moved within the season, but with a 10% movement being the norm. "But during the past six years we have seen market price movements beyond those we came to expect, with some seasons showing price movements for the main agricultural commodities of over 100%." Buying feed at the right time had always been an important factor, she argued, but this had become increasingly so as time had progressed.
After scaling to a record Rs 3.33 a piece last week, the egg price has cooled down. Faced with buyer resistance and to perk up poultry consumption, the National Egg Coordination Committee (NECC), Namakkal zone, has slashed the price of an egg by 13 paise to Rs 3.20. The commodity hit a record Rs 3.33 on rise in demand following the onset of South-West monsoon. From May 26 to June 28, the wholesale price was raised 15 times from Rs 2.75 to Rs 3.33 (an overall increase of about 20 per cent). Industry sources attributed the price cut to buyer resistance. “We see a lag in the offtake owing to higher prices at retail level and we don't want to pile up these perishable products. Hence, we have trimmed prices to perk up consumption,” a source said. Mr P. Selvaraj, Zonal Chairman, NECC, Tamil Nadu, said that a host of factors such as rise in consumption, spiralling input costs, pricey vegetables, ban on fishing in the neighbouring Kerala & Karnataka (major markets for TN's poultry trade) pushed egg prices up. “Prices are likely to remain at the same level in the coming days to boost offtake,” he added. “Of our average production of 2.75 crore eggs, we used to send 30 lakh eggs to Kerala. It has almost doubled owing to a fishing ban in that State,” said a poultry-unit owner in Namakkal. On the export front, the industry is pinning hopes on neighbouring Bangladesh that has opened its gates to poultry imports to meet Ramadan demand. Exports plummeted to a 10-year low of 240.88 lakh eggs in May against 330.62 lakh eggs last May. Prices of layer birds have been trimmed to Rs 44/kg (Rs 48), while the Broiler Coordination Committee has slashed chicken prices to Rs 55/kg (Rs 60). Broiler prices touched a record Rs 76/kg a fortnight ago.
The price of an egg increased to a new record of Rs 3.33 on rise in demand following the onset of South-West monsoon. The price is expected to go up further in the next few days, though marginally, according to the Chairman of NECC, Namakkal Zone, Mr P. Selvaraj. Sources in the poultry industry expect even chicken prices to rise further in coming days. “Of our average production of 2.75 crore eggs (in Namakkal), we used to send 30 lakh eggs to Kerala. Now, it has almost doubled owing to a ban on fishing in that State,” said a poultry-unit owner in Namakkal. Since last week, the National Egg Coordination Committee (NECC), Namakkal zone, has hiked the price by 11 paise from Rs 3.22. Mr P. Selvaraj said that the increase in egg price was due to continued demand. From May 26 to June 28, the wholesale price of egg has been raised 15 times from Rs 2.75 to Rs 3.33 (an overall increase of 19 per cent). A host of factors such as rise in consumption, spiralling input costs, pricey vegetables, ban on fishing in the neighbouring Kerala and Karnataka have catapulted egg prices. Also soaring cost of soyameal – a key ingredient in poultry feed is also one of the reasons. Soyameal at Indore ruled at Rs 33,330-33,600 on Thursday against Rs 17,300 - 17,400 during the corresponding date a year ago. Feed costs account for two-thirds of production cost at a poultry unit. On the export front, the industry is pinning hopes on neighbouring Bangladesh that has opened its gates to imports to meet Ramadan demand. Exports hit a 10-year low of 240.88 lakh eggs in May this year against 330.62 lakh eggs in May 2011.However, prices of layer birds have been cut to Rs 48/kg (Rs 54), while the Broiler Coordination Committee has slashed chicken prices to Rs 60/kg from last week's record Rs 76. Industry sources said that the price of layer birds had come down as the production of broiler chicken – that dropped in the summer – had started picking up with the onset of the monsoon. This has led to drop in the prices as layer bird prices are based on the demand and price of broiler chicken.