The revenue of the Indian poultry industry could increase by 8-10% in the current financial year. According to a report by rating agency CARE Edge Ratings, the operating profit margin of the domestic poultry industry may rise by 180-220 basis points in the 2024-25 fiscal year. The agency anticipates that the coming year will also be favorable for the poultry industry.
The report states that by 2024, India has made significant progress in egg and broiler meat production, producing over 140 billion eggs and approximately 4.5 million tons of chicken meat annually. The demand for eggs and chicken has surged due to urbanisation and rising incomes, which has fueled the industry's rapid growth. The industry is also benefiting from stable input costs, improved feed management, and government support. Additionally, the demand for meat and eggs increases during festivals and winter, which further boosts the industry.
The report further mentions that egg and meat production in India has consistently grown over the past decade, playing a key role in meeting the country’s protein needs. In the food sector, meat, fish, and seafood fulfill about 31-34% of the total protein demand. In the coming years, egg production is expected to grow by 7-8% and meat production by 5-6%.
During the COVID-19 pandemic in 2020, the poultry industry suffered significant losses, reducing income and revenue. In 2022, however, earnings for major poultry companies improved, although rising maize and soybean prices increased production costs in 2023 and 2024. Maize and soybean are primary components of poultry feed, and their prices surged due to supply issues. Nevertheless, with a good harvest and government support, prices have now stabilized.
Key Challenges for the Industry
Fluctuating Input Costs: The poultry industry relies heavily on maize and soybean, which make up approximately 65-70% of the total feed cost. In the 2024 fiscal year, the stabilization of feed prices has improved industry profits. Large companies are addressing this challenge by focusing on better breeds and feed conversion ratios (FCR).
Impact of Diseases: Diseases like avian influenza negatively impact industry profits by reducing sales and increasing costs for preventive measures. Major companies in the industry are working to develop vaccines and disease-resistant breeds.
Feed Conversion Ratio (FCR): FCR is crucial for profitability in the poultry industry. Enhancing FCR through improved breeds and feed quality can increase profitability.