The demand for broiler meat would continue to grow at eight to 10 per cent a year while table egg demand would increase four to five per cent in long term, ratings agency ICRA has estimated.

According to The Times of India, domestic poultry meat production (broiler - carcass weight) is estimated to have increased from less than 1 million tonnes in 2000 to 3.4 million tonnes in 2012 with per capita consumption increasing from 0.8 kg to 2.8 kg per annum during the period. Table egg production is estimated to have increased from 30 billion eggs in 2000 to 66 billion eggs in 2012 with per capita egg consumption increasing from 28 to 55 eggs during that period.

"The healthy growth in poultry output over the last decade makes India one of the fastest growing major world markets in the segment with future growth potential remaining strong on the back of a wide gap against global per capital consumption norms and favourable socio- economic factors," ICRA said.

The poultry industry has been growing at around eight per cent to ten per cent annually over the last decade with broiler meat volumes growing at more than ten per cent while demand for table eggs has been increasing five per cent to six per cent driven by increased domestic consumption.

The productivity gains of poultry industry are reflected in the relatively lower price increases in poultry meat over last five years compared to other meat products. Poultry WPI (wholesale price index) has grown at 12 per cent y-o-y over 2008-2013 compared to 21 per cent for overall meat products basket, providing an affordable alternative for meeting protein requirements in Indian diet.

The industry however continues to face challenges such as high feed costs, inadequate cold chain and transportation infrastructure, high vulnerability to disease outbreaks and highly volatile realisations affecting cash flows. The average production costs for a typical commercial broiler farm which was in the range of Rs. 45-50 per kg in 2011 increased to more than Rs. 62-65 per kg in the second half of 2012 as prices of feed ingredients touched record highs.

"Transition from a predominantly live bird/wet market to a chilled/frozen market is crucial for the future expansion of domestic poultry industry as well as to increase presence in international trade where India has negligible presence," ICRA said.

"Developing efficient distribution system with large investments in cold chain infrastructure and increasing market acceptability of frozen chicken are going to be the key industry drivers in long-term," it said. The industry, which faced rough weather in 2012, is expected to recover this year as it has managed to control supply through measures like hatching holidays, ICRA said.