MUMBAI: Buoyed by favourable socio-economic conditions like rising purchasing power and changing food habits, the country's poultry sector is likely continue growing in the long term, rating agency ICRA has said.
While demand for broiler meat is likely to continue growing at up to 10 per cent, that of egg is expected to rise at about 4-5 per cent in the long term, ICRA said.
The challenges faced by the poultry industry are high feed costs, inadequate cold chain and transportation infrastructure, high vulnerability to disease outbreaks and highly volatile realisations affecting cash flows, according to ICRA.
Developing efficient distribution system with large investments required in cold chain infrastructure and increasing market acceptability of frozen chicken are going to be the key industry drivers in long term, ICRA said.
Indian poultry sector has been growing at around 8-10 per cent annually over the last decade with broiler meat volumes growing at more than 10 per cent, while table egg which is growing at 5-6 per cent is mainly driven by increased domestic consumption.
Farmers in the country have moved from rearing country birds in the past to rearing hybrids which ensure faster growth of chicks, higher eggs per bird, increased hatchability, low mortality rates, excellent feed conversion and consequently sustainable profits to the poultry farmers.
The growth in production of poultry industry are reflected in relatively lower price increases in poultry meat over last five years compared to other meat products - Poultry WPI (wholesale price index) has grown at 12 per cent year-on- year over 2008-2013 as against 21 per cent for overall meat products basket - providing an affordable alternative for meeting protein requirements in Indian diet.
The domestic poultry meat production is estimated to have increased from less than one million tonne in 2000 to 3.4 million tonnes in 2012 with per capita consumption increasing from 0.8 kg to 2.8 kg annually during same period, it said.
Table egg production is estimated to have increased from 30 billion eggs in 2000 to 66 billion eggs in 2012 with per capita egg consumption increasing from 28 to 55 eggs during that period.
The healthy growth in poultry output over last decade makes India one of the fastest growing major world market in the segment, said ICRA in the report.
In 2012 calender year, the second half was a tough year for the industry due to an increase in production costs with feed ingredients touching record highs and realisations suffering on back of oversupply in industry.
However, the efforts of key integrators in poultry industry to control supply through measures like 'hatching holidays' initiated towards fag end of 2012, resulted in improved realisations in 2013, and the industry is expected to register much better profitability compared to last year.
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