Plandai Biotechnology Inc. (PLPL) Addresses Opportunities in the South African and Global Poultry Industries

Plandai Biotechnology Inc. (OTC Markets: PLPL) (the “Company” or “Plandai”), a producer of nutraceutical and highly phyto-available extracts, is pleased to provide background on the current known issues in the global poultry industry and its identification of potential opportunities.

Globally, more than 58 billion chickens are raised annually as a source of food, for both their meat and eggs. Chicken producers use nationally approved medications, such as antibiotics and antivirals in feed or drinking water, to treat disease or to prevent disease outbreaks.  As a result of the ban on the use of antibiotic growth promoters in animal diets in the European Union as from January 2006, and the growing pressure on poultry producers in other parts of the world, alternative substances and strategies for animal health and growth promotion are now necessary.

The Top five companies, in terms of number of birds slaughtered in 2017, were:

1. BS S.A., Brazil, 3,380 million

2. Tyson Foods, U.S., 2,310 million

3. BRF, Brazil, 1,664 million

4. CP Group, Thailand, 939 million

5. Wen’s Food Group, China, 714

In South Africa, the poultry industry is the largest segment of the agricultural sector, contributing more than 16% of its share of gross domestic product. It provides employment, directly and indirectly, for more than 100,000 people throughout its value chain and related industries. This industry is highly concentrated, reflecting the levels of investment required to improve efficiencies and produce competitively. The value chain is dominated by a few large companies that rely on the benefits associated with the economies of large-scale production, as well as integrated supply chains that reduce production costs, ensure high throughput levels and diversify products to improve risk management. Broiler chicken production in 2017 was 1.4 billion birds and dominated by Astral Foods, RCL Foods (Rainbow Chickens) and Country Bird Holdings.

Over the past few years this industry experienced very difficult times and eroded profits due to drought, the resulting high cost of feed and electricity, controlled brining regulations, a severe bird flu outbreak, cheap chicken imports, and recently an identified listeriosis outbreak through improperly processed chicken and meat products resulting in more than 200 human deaths.

In light of this, the South African poultry industry is striving to produce better products and has increased its interest in developing phytogenics for formulation into animal feeds that potentially deliver improved feed efficiency, replacement of antibiotic usage, a lowering of the environmental footprint and an improved and optimized gut performance.

Phytogenics are a group of natural non-antibiotic growth promoters used as feed additives, derived from essential oils, herbs, spices or plant extracts. They are commonly regarded as favorable alternatives to antibiotic growth promoters in livestock production by providing a range of biologically active properties that can be applied to modern bird production. These include anti-oxidant, anti-inflammatory, anti-microbial and digestion enhancing effects. According to Markets and Markets Inc., the current global feed phytogenics market is $769.5 million and with the poultry segment accounting for the largest share in this new industry.  Furthermore this segment is rapidly growing as the production of poultry is becoming more intensive and vertically integrated due to continuous technological advancements along with growing economies; and through a rapidly growing middle class income that demands organic and safe poultry meats.

Phytogenic botanical products continue to receive positive attention from producers and consumers, who generally prefer the replacement of chemicals with natural additives in animal diets. Producers find that the natural additives increases the productivity of poultry through amelioration of feed properties, promotion of the animals’ production performance, and the quality of food derived from those animals. Furthermore, this class of feed supplement has recently enjoyed increased interest as is shown from a significant increase in the number of scientific publications with green tea catechin extracts since 2000.