Soon, Indians will be able to sink their teeth into Brazilian chickens

• 29 Apr, 2019
• India

After frozen chicken legs from the US, poultry products from far-off Brazil are on their way to tickle the taste buds of Indian consumers.

JBS, the largest meat processor in Brazil, is set to introduce its chicken products, including thighs and leg quarters, in the Indian market soon through its subsidiary Seara.

It was reported last week that Seara has received approval from authorities here to sell its chicken products in the country.

Domestic poultry players are rattled at the latest threat; imports of poultry products rebounded in 2018-19 after India lost a protracted dispute at the WTO to the US.

Per the latest DGCIS (Directorate General of Commercial Intelligence and Statistics) data, poultry product imports rose to 797.73 tonnes, valued at $5.45 million (₹37 crore) for the April-January 2018-19 period. In the previous financial year, poultry imports stood at 572 tonnes at $4.17 million (₹26.87 crore).

Interestingly, poultry imports from the US increased the most, at 136.92 tonnes valued at $1.2 million, in April-January 2018-19, as against 0.01 tonnes in the previous year.

Level playing field sought

Faced with a new threat, poultry players are seeking a level playing field to compete with low-cost producers such as the US and Brazil, where the birds are fed on genetically-modified corn and soyabean.

Besides seeking higher maize imports to tide over short supplies, poultry players also want the Centre to increase the bound duty on chicken product imports to protect domestic farmers.

“While the current duty levels on imports may provide a partial protection, in the long run the cheaper imports will harm the domestic poultry sector,” said B Soundararajan, Managing Director, Suguna, a large poultry player. At present, chicken portions such as legs and sausages attract 100 per cent duty.

“Chicken legs, which are not consumed in the West, are sold at a throwaway price. Despite 100 per cent duty, the imported chicken legs will still be cheap in India,” said Soundararajan. The cost of production for chicken legs is estimated at around $700-800 per tonne in the US. With 100 per cent duty, it would still be available at $1,500-1,600 per tonne, while the cost of production of processed chicken in India is around $1,800 per tonne, Soundararajan said. Further, he said, the government should provide a level playing field by allowing higher imports of maize, the main raw material for the poultry sector. “While maize prices are ruling at $300 per tonne in India, the same is available to poultry producers in Brazil and the US at $160-170 per tonne. The government is now allowing higher imports. How can we compete with such high prices,” Soundararajan said.

Already, the cost of production has increased by over 40 per cent on over the past six months on higher maize prices. “The rising production cost is a big threat for domestic players as India becomes a lucrative market for low-cost producers such as the US and Brazil. Once out of business, it would be difficult for poultry farmers to make a comeback,” said KS Ashok Kumar, founder, MAA Integrators.

India’s per capita meat consumption, according to Compound Livestock Feed Manufacturers Association, is set to grow to 5.98 kg by 2025 from 3.35 kg in 2017 with the population rising and income levels growing.

Source: https://www.thehindubusinessline.com/economy/agri-business/soon-indians-will-be-able-to-sink-their-teeth-into-brazilian-chickens/article26973729.ece