Can't predict impact of US imports on India's livestock feed mkts: Cargill

Company opens largest dairy feed plant in South-Asia in Punjab today with an investment of ₹300 crore

Cargill, the global food, ingredients and agricultural solutions major, on Thursday opened its largest dairy feed plant in South Asia in Punjab’s Wazirabad (the company’s second in the state after Bathinda). The plant involves an investment of Rs 300 crore and will have an annual production capacity of 400,000 tonnes. It covers 15 acres and will provide direct and indirect employment to nearly a 1,000 people.

 

Cargill said the Wazirabad plant will give dairy farmers access to world-class feed solutions. Ravinder Balain, country president of Cargill India and senior managing director of Cargill Animal Nutrition and Health, South Asia, in a video interview with Sanjeeb Mukherjee, discussed the company’s plans in the animal feed business and the impact of the US-India trade deal on India’s animal feed markets. Edited excerpts:

 

You are inaugurating a new facility in Punjab. What exactly is Cargill doing in animal feed?

 

We are taking another major step in our dairy feed business with a new manufacturing facility in Wazirabad, Punjab. A few years ago, we invested in a plant in Bathinda. This is our second investment in the state and our largest dairy feed plant in South Asia, and one of the biggest in the Asia-Pacific region. It reflects our long-term commitment to India’s dairy sector.

 

What is the capacity of this new plant?

 

The facility will have an production capacity of around 34,000 tonnes per month, translating to roughly 400,000 tonnes annually.

 

How large is this plant in the Indian context? Compared to competitors, would you call it among the biggest?

 

Given the spatial nature of the dairy feed business, plants need to be close to markets rather than extremely large and centralised. Within Punjab, this will certainly be among the largest facilities. In the broader Indian context, it ranks among the bigger dairy feed plants.

 

Cargill is often associated with edible oils, oilseeds and cotton. How significant is your animal feed business in India?

 

Cargill has been operating in animal nutrition in India for over two decades. Beyond dairy feed, we are also involved in dairy health and pet health. Over the past decade, we have scaled up investments significantly in dairy feed and poultry-related solutions.

 

Do you manufacture and sell feed locally? Is any of it imported?

 

Dairy feed imports are not permitted in India. In fact, all feed is produced domestically. The raw materials used in dairy and poultry feed are sourced within the country. Cargill manufactures and sells dairy feed under its own brands. We are one of the leading players in this segment and work closely with dairy producers nationwide.

 

What are your total dairy feed volumes in India?

 

The new Punjab plant will have n annual capacity of about 400,000 tonnes. Our existing Bathinda facility produces roughly 250,000 tonnes annually. Combined, we operate in the range of about 650,000 to 700,000 tonnes per year, though I cannot share precise sales numbers.

 

Is this your entire animal feed business?

 

This is specifically dairy feed. In poultry, we operate under a different model.

 

What is that poultry model?

 

Rather than manufacturing poultry feed at scale in India, we focus on bringing Cargill’s global R&D expertise to the Indian market. We work with global poultry companies across Brazil, North America and Europe, and leverage that technical knowledge to support poultry production here.

 

What raw materials go into dairy feed?

 

The primary ingredients include rice milling byproducts such as rice bran and de-oiled rice bran, rapeseed meal and corn. We also use various byproducts from food and commodity processing industries. These ingredients are formulated to ensure optimal nutrition for dairy cattle.

 

Soybean meal is widely discussed in feed markets. Do you use it?

 

Soybean meal is primarily used in poultry feed. It is not a key ingredient in dairy feed formulations.

 

How has the market behaved in recent years? Maize prices were elevated earlier. Distillers Dried Grains with Solubles (DDGS) prices have risen sharply— from Rs 12–15 per kg to Rs 23–25 per kg. Has the market stabilised?

 

Feed ingredients are commodities, so price fluctuations are inevitable. Some ingredients rise while others stabilise or fall. However, the broader dairy nutrition market remains robust, growing steadily at 6–7 per cent annually.

 

What is the size of India’s cattle feed market?

 

Excluding poultry, India’s cattle feed ingredient market is about 120 million tonnes annually. This includes cottonseed cake, pulses by-products and other feed inputs. At current growth rates, the market could expand to roughly 170 million tonnes over the next five years.

 

How much of this market is organised?

 

Around 12–15 per cent of the total market consists of organized, quality-assured feed manufacturers like us. The rest comprises unorganized and local players.

 

Isn’t 12–15 per cent relatively small?

 

Not necessarily. The organised segment is growing faster—at about 10–12 per cent annually. Over time, it will capture a larger share of the overall market, especially as quality and compliance standards become more important.

 

How have raw material costs increased for you?

 

As you mentioned, DDGS prices nearly doubled at one point. Other ingredients have also fluctuated. Managing this volatility requires constant balancing of input costs while maintaining nutritional quality.

 

Have you raised retail prices?

 

Pricing adjustments are largely market-driven. All players have made changes depending on commodity trends. Our priority is to maintain feed quality. A nutritionally balanced dairy feed requires optimal protein, fibre and energy levels. Regardless of cost fluctuations, our objective is to ensure animal health and sustained milk productivity.

 

Do you expect prices to normalise?

 

Yes, normalisation typically depends on cropping cycles and milling activity. As fresh crops arrive and supply improves, commodity prices tend to stabilize.

 

Let’s turn to trade. There is debate around possible imports of US DDGS under a trade agreement. How do you see this affecting the industry?

 

It is still premature to comment. We need clarity on the final terms of any agreement between India and the US. Based on public statements, it will not be a completely free import regime. The implications will depend on volumes, conditions and safeguards.

 

US DDGS is considered high quality with lower aflatoxin levels and is currently priced competitively. Could this benefit Indian feed millers?

 

Aflatoxins are a critical issue. They affect animal health, milk productivity and ultimately enter the human food chain. Improving aflatoxin management is an area where the Indian industry must strengthen compliance. If imports meet high-quality standards, they could contribute positively. But pricing and impact will depend on multiple variables.

 

Reports suggest around 0.5 million tonnes of US DDGS could enter annually. Is that large enough to cause disruption?

 

It is difficult to predict. The impact depends on how companies use DDGS in their formulations and how it fits into the broader commodity basket. We need to see the final contours before drawing conclusions.

 

Some argue large players will benefit more from the imports. What is your view?

 

The market ultimately balances itself. It is not simply about company size. The key is maintaining overall industry stability.

 

There is also talk of US red sorghum imports, mainly used in poultry feed. Could this create major churn in domestic markets?

 

Red sorghum is largely a poultry ingredient. Again, the impact will depend on import volumes and agreement details. Commodity markets operate on balance: Availability, substitution and demand all play a role.

 

So predictions of maize price crashes or major farmer distress are premature?

 

Yes. Until agreements are finalised, it would be speculative to forecast outcomes. Markets respond to concrete policy measures, not assumptions.

 

Where does this new investment position Cargill in India’s dairy feed sector?

 

With this new facility, we will be among the top three dairy feed players in India. There are about four or five leading companies in this space, and Cargill will certainly be one of them. Our focus remains on working closely with dairy farmers in Punjab and across India to improve farm management practices and enhance milk productivity.