HATCHING PROFITS

India's appetite for poultry products continues to grow

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The poultry industry in India has made significant strides in recent years, with two distinct trends emerging over the past two decades. Firstly, there has been a growing selection of foods that use poultry products, as is evident from the surge in poultry brands. Secondly, the industry has undergone a transformation from being unorganized to organized, leading to a more stable and efficient business.

As discretionary spending continues to rise in India, the poultry industry is poised to demonstrate steady growth in the coming months. Despite facing sluggish business during the pandemic, the industry is expected to rebound and post strong growth in the upcoming year.

Understanding the fundamentals of this niche industry is crucial to comprehending the reasons behind its projected growth. As India's appetite for poultry products continues to grow, the poultry industry is expected to post stable growth over the next one year.

THE INDUSTRY

The Indian poultry industry has undergone a significant transformation over the past two decades, with organized commercial farms dominating more than 70% of the broiler segment. This shift from backyard farming to large-scale commercialization has resulted in a vertically integrated industry, with companies managing their own hatcheries, feed mills and processing facilities.

While companies primarily source Day Old Chickens (DOCs) from contract farmers to whom they provide credit and veterinary medicines, the distribution and retailing of poultry items remains largely unorganized due to consumer preference for live birds.

The industry presents several opportunities for growth, including increasing demand for protein-rich foods, growing urbanization and increasing disposable income. However, it also faces several challenges, including rising feed and labour costs, diseases such as avian flu and lack of proper infrastructure.