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Resource centre on India's rural distress
 
 

Indian economic growth in 2011 improves poultry farmers' prospects by Caroline Stocks

The Indian economy is moving back into the fast lane, with agriculture playing a leading role. A new financial review presented by the government in mid-December anticipated economic growth of up to 9% for the year to March 2011, and forecasters believe double-digit expansion is on the cards for later in the year.

"Faster growth is expected to continue as agriculture recovers sharply from last year's drought and inflation starts to fall," said the government review. "Both in turn will boost demand in rural and urban areas and improve investor confidence."

And poultry production is very much part of this more buoyant Indian picture.

Sanjeev Gupta, managing director of Khushboo Feed Mills and a large-scale poultry producer, has seen his business steadily expand over the last decade, but he predicts the next few years will see huge developments in the industry.

Since he opened his feed mill in Gurgaon, about 30km from Delhi, in 1972, Mr Gupta has grown his business by 7% every year. But over the next year, he plans to almost triple that growth to 20%.

Like many poultry farmers, Mr Gupta has seen his business' expansion mirror that of the country's economy. India is the second-fastest developing country in the world behind China.

The economic growth has seen wages in India rise and with that people have begun to start spending more money on food. The westernisation of Indian diets has also meant a greater amount of animal protein is being consumed, resulting in significant growth in poultry consumption.

"As our economy has grown, average income has also increased," says Mr Gupta. "People are spending more on good, healthy food and as eggs are the cheapest source of protein, we are seeing huge growth.

"About 80% of Indians are also vegetarian, but younger generations are adopting a western lifestyle and are eating more meat, meaning there is huge potential for growth in poultrymeat."

Mr Gupta currently produces more than 80,000t of feed a day on his largely unmechanised unit, using farm-grown corn, soya imported from Rajastan - a neighbouring state - and a vitamin premix.

Alongside a 50,000-head broiler unit, he also has 60,000 layers and an 80,000 chick hatchery, selling two-day-old chicks on to five farmers in the region.

The hatchery is high-tech and marks the start of Mr Gupta's plans to mechanise the business. He is currently building a climate-controlled broiler unit which will take him to 150,000 head, and hopefully reduce his flock's 5-8% mortality rates.

He also plans to move into processing within the next few years, with a view to exporting chicken meat.

Like many farmers in India, Mr Gupta is constantly looking to the West to find the latest developments in technology as well as poultry welfare and hygiene standards.

In 2002 he travelled to the USA to enroll on a feed, machinery and poultry farming course at Kansas University, while animal health technicians regularly visit the farm to check nutrition standards are being met.

His laying flock is not currently free range as he cannot command a premium from the market. But his birds are housed in bigger-than-average 18in cages, while his broiler birds are housed in sheds with automatic feeders and watering systems.

"If the birds are happy they will produce more eggs and better meat," he says. "It makes sense to have high welfare systems in place. I am confident my units would meet international standards to allow me to export."

Ricky Thaper, spokesman for the Poultry Federation of India, says poultry production is India's "sunrise industry".

"Within the next five years, the broiler industry will be the biggest in Indian agriculture," he says.

"In six weeks farmers get a return on their investment. That initial investment is also small, meaning there are no barriers to people entering the industry."

Mr Thaper says the government is also investing heavily in poultry as a potential source of employment.

"As agriculture here becomes more mechanised, we are seeing a change in employment. Students are looking to the poultry and dairy industry for jobs. Agriculture is being seen as a modern industry and people want to work in it."

Infrastructure is now the biggest constraint to India's poultry producers. Poor road systems and high transportation costs mean producers like Mr Gupta can only sell the birds within 200km of their farm.

Facilities to keep meat chilled are also limited, says Mr Thaper. But he hopes the growing involvement of international companies in the Indian poultry market means investment in a cold chain will increase soon.

"The concept of a cold chain is new to India. Energy shortages throughout the country make it even more difficult, as costs are high with this kind of system.

"Big poultry companies are developing the cold chain, but it takes time to develop on the scale required for the vast Indian market.

"That development will come though. Within 10 years this will be an industry capable of competing internationally."