Feed Industry in Bangladesh (Part 2)
Feed milling industry in India can be divided into organized and unorganized sector. The products are used by the poultry farms and fish farms throughout the country. There is a huge gap between production and supply of the feed items. Bangladesh is an Agro-based country. Its agricultural products are used as basic raw materials of the industrial products such as Poultry feed, Fish Feed Shrimp Feed and cattle feeds. With the growth of the population and rapid increase in Poultry and Fish culture, these feed items have tremendous demand throughout the country. The growth and stability of Poultry, Fishery and Dairy depends on the balanced protein diets that are to be produced by maintaining international standard and quality. But the number of such types of industries so far in the country is very few and they cannot meet-up the increasing demand of this sector. As a result, a significant amount of gap is always prevailing. On the other hand, the feed industries established in the country, region wise, do not have a minimum balance throughout the country. As such, some parts of the country have sufficient feed industry and the supply is also higher than the actual demand but some parts of the country are suffering from short supply compared to their demand. For this reason, the poultry industry could not grow to cope up with the increasing demand. Their production cost is also high and as a result, they are in big trouble in continuing their business in a competitive market.
Feed market is nearly 50% of the total poultry industry size. Total demand is estimated to be 240,000 MT/ month which is met roughly 50% from the top 7 producers. The balance is produced on home mix basis at the farm level (roughly 25%) and by smaller low quality local level producers (roughly 25%). However, there is a major difference in quality between the two different forms of feed. Primarily as home mix feed is produced without expert supervision at the grassroots level in small farms and does not include some key vitamins and additives that are included in ready feed mixes. Furthermore, home mix feed is often made from maize and soy-bean that are past its expiry life contributing to the low quality. Based on our discussion with owners of several large wholesale feed outlets, the demand for ready mix is increasing at a rapid pace at the cost of home-mix feed. The industry trend is shifting towards relatively higher-priced balanced feed manufactured by mechanized feed millers due to high feed conversion ratio leading to greater commercial benefit. Increased demand from the ready mix feed segment is expected to come at the cost of declining home-mix feed market and exit of smaller, low quality producers having lower economies of scale. With the course of time some companies have earned a good reputation in the field of business and as a result, their customer base is increasing strongly. To meet up market demand for the feed industry, these companies are going to increase its production capacity from existing per hour production capacity in recent years. Among the major feed mill companies in Bangladesh, Agro Industrial Trust, Rupsha Poultry Feeds Ltd., BRAC Poultry Feeds Ltd., Paragon Poultry Feeds Ltd., Surma Poultry Feeds Ltd., Kazi Poultry Feeds Ltd., Provita Feeds Ltd., Aftab Bohumuki Farms Ltd., Narish Poultry Feeds Ltd., Saudi-Bangla Fish Feed Ltd., New Hope Feed Ltd., Aman Feeds Ltd. are the major players.
These poultry feed Mills are now in operation but the actual demand is higher than the real production because the feed mills are more capital intensive than that of a poultry firm. As a result, the growth of feed production industry could not cope with the poultry industry.
About 90% of the ready poultry feed is consumed by the broiler and layer birds. The remaining 10% is consumed by grandparent and parent birds. At present, over 52 local animal feed producers are operating in Bangladesh with CP, Paragon, Aftab, Quality, Kazi, and Quality controlling the bulk of the market. Both entry and exist barrier is high for the commercial feed industry. Capacity of the mill should be relatively large i.e. >15MT/hour capacity and hence, it is very capital intensive. Feed business is volume driven. Attaining economies of scale in the production process is hence the key dynamic in this business. Smaller commercial ready feed makers are hence facing survival risks in the face of competition from larger, more efficient top producers. Based on discussion with owners of wholesale feed outlets, it is important for a ready-mix producer to be well-positioned for future growth by adding substantial capacity to existing production levels. The unanimous agreement in the market is that this segment is growing at a minimum of 10%-15%/annum and enhanced capacity levels to tap into future expansionary demand pattern and to ensure the maintenance of economies of scale are key dynamics in this business. Among these, only three large companies – Kazi Farm Ltd, Paragon Poultry and Nourish Feed Ltd – practice formal input-marketing contracts.
Công ty TNHH Khoáng Sản Xanh / 0 Bình luận / 02/ 08/ 2017