How the US trade deal will change India’s feed market

In March 2025, barely two months after Donald Trump assumed office as president for his second term, the United States Department of Agriculture (USDA) released a report titled ‘The Growing Demand for Animal Products and Feed in India’. The report projected India’s domestic corn (maize) consumption to increase from an estimated 34.7 million tonnes (mt) in 2022-23 to 62.8 mt in 2040 and 93 mt in 2050 under a “moderate” GDP growth scenario of 4.6% per year. The consumption of soyabean meal would correspondingly go up from 6.2 mt to 17.7 mt and 28.3 mt for these years. The consumption would be even higher in a “rapid” GDP growth scenario of 6.6% per year – at 98 mt in 2040 and 200.2 mt in 2050 for maize and, likewise, 30.9 mt and 68.3 mt for soyabean meal. With domestic production not keeping pace with the above demand growth, it would call for large-scale imports. The USDA report projected these at 11 mt and 26 mt for maize and 6 mt and 13 mt for soyabean meal in 2040 and 2050 respectively under the “moderate” scenario. The corresponding import numbers under “rapid” income growth were 46 mt and 134 mt for maize and 19 mt and 53 mt for soyabean. The background The significance of the report lay both in the context and timing. Maize and soyabean meal are basically feed ingredients. Maize, wheat, rice, sorghum and other cereal grains are sources of carbohydrates that supply the energy needs of poultry birds, livestock and aqua animals. Soyabean contains 18-22% oil. The residual cake after the oil is extracted is the so-called meal, which is high in protein. The protein in poultry, livestock and aqua feed comes from the meal of soyabean, rapeseed (mustard), cotton seed, groundnut and other oilseeds, as well as the bran or outer layer of rice and wheat grains removed during milling. Broiler chicken feed, for instance, typically contains 55-65% maize by weight, with these at 50-60% for egg-layer bird feed and 15-20% for cattle feed. The balance comprises the various protein sources (meal and bran), minerals (calcium and phosphorus), vitamins and other supplements/additives. With rising incomes, urbanisation and a population of at least 1.5 billion by 2050, India is likely to see a significant diversification of diets away from cereals and staples to foods rich in proteins and micronutrients. That includes animal products such as milk, eggs, meat and fish. As demand for these grows, so would the requirement for feed and their ingredients. Take maize, where out of India’s total expected production of 43 mt in 2025-26, about 24 mt would go towards feed use. The accompanying table shows the supply of different raw materials/ingredients used as animal feed. For now, the bulk of this material is supplied from domestic crop production. The USDA, however, foresees a situation where India’s feed crop cultivation will not be able to supply the demand from sustained income growth, whether under “moderate” or “rapid” scenarios. One reason for it is per-hectare yields that averaged 3.75 tonnes for corn in India (versus 11.25 tonnes in the US) during 2024-25. The same for soyabean was below one tonne in India, against 3.4 tonnes in the US. That, then, opens up a potential market for American corn and soyabean. India’s annual maize and soyabean output of around 43 mt and 12.5 mt is a fraction of the US’ 425 mt and 120 mt respectively India’s feed industry The total production of compound feed (formulated using the various above-mentioned ingredients) in India is pegged at some 60 mt. That includes 40 mt of poultry, 18 mt of cattle and 2 mt of aqua/shrimp feed. “If you take an average price (ex-mill) of Rs 34-35/kg for broiler, Rs 29-30/kg for egg-layer, Rs 23-24/kg for cattle and Rs 83-85/kg for shrimp feed, the size of our industry would be upwards of Rs 175,000 crore,” says Divya Kumar Gulati, chairman of CLFMA (formerly Compound Livestock Feed Manufacturers Association) of India. While the organised feed industry mostly uses indigenous raw material/ingredients, it has, of late, also been seeking access to imported maize and soyabean. The major roadblock there, though, has been the fact that the maize and soyabean grown in the US (and also Brazil and Argentina) is predominantly genetically modified (GM). The Directorate General of Foreign Trade, in August 2021, did allow import of 1.2 mt of soyabean meal and cake, including that derived from GM oilseed, as a temporary measure following a domestic shortage and spike in prices. But that was a one-off authorisation, with the imports being permitted only through eight designated ports/land stations: Nhava Sheva, Petrapole, Mumbai, Tuticorin, Visakhapatnam, Ghojadanga, Kolkata and Ranaghat. What the US has managed to get Under the bilateral trade agreement virtually sealed with the US, India has retained the ban on imports of GM maize and soyabean. At the same time, it has opened up imports of two other feed ingredients. The first is red sorghum. The US is the world’s largest producer and exporter of sorghum, with estimated volumes of 11 mt and 5.4 mt in 2025-26. In January last year, the US Grains Council took Indian poultry industry stakeholders on an exposure visit to promote American sorghum as a “non-GM” alternative to GM corn. “GM adoption…will still take some time; however, sorghum provides an immediate non-GM solution for animal feed manufacturers in India – one that the industry urgently needs,” according to a statement from the organisation that develops export markets for American grains. The second is distiller’s dried grains with solubles or DDGS. Maize contains roughly 70% starch, 8-10% protein and 3-4% oil content and balance pericarp (husk). The starch is first broken down into sugar (glucose), which is fermented into alcohol using yeast and further distilled into 99.9% pure ethanol. After the ethanol is separated, what remains is the wet fermented grain mash that is dried to yield DDGS. “DDGS has the 8-10% protein part of the maize, which becomes 25-30% on concentration. The DDGS from rice has even higher 40-45% protein,” explained Firoz Hossain, principal scientist at the Indian Agricultural Research Institute in New Delhi. Grain-based ethanol distilleries in India are already supplying over 3 mt of DDGS to the feed industry and is forecast at 4.2 mt in 2025-26. The imports from the US would add to that, notwithstanding its DDGS being derived from GM corn. Simply put, India has not opened up to American GM corn and soyabean or meal yet. But it has provided a small window through sorghum and DDGS. Harish Damodaran is National Rural Affairs & Agriculture Editor of The Indian Express. A journalist with over 33 years of experience in agri-business and macroeconomic policy reporting and analysis, he has previously worked with the Press Trust of India (1991-94) and The Hindu Business Line (1994-2014). ... Read More