The promise was irresistible—invest in emu farms in Erode, Tamil Nadu, and more than double your money in two years. The world, so went the spiel, couldn’t get enough of the meat and oil this wonder bird would produce. The bubble burst in July, six years after Susi Emu Farms, one of the largest in the business, first launched the scheme.

And what of the birds languishing in the scam-hit farms? They are being looked after by the state’s animal husbandry department after being abandoned by the companies that have decamped.

Thousands of emus, the largest birds native to Australia, are to be slaughtered and the meat is to be auctioned, said Dharmendra Pratap Yadav, the state’s animal husbandry commissioner. There may not be too many takers for this though.

“Currently, we are taking care of 12,500 birds in 21 farms in Erode, but ultimately, these birds will have to be disposed of," Yadav said. “We need to obtain permission from the government and subsequently the court for their disposal, and tenders will be invited from meat processors."

The scheme worked like this. The promoters of the emu farms, located mostly in Perundurai in Erode, promised returns of 3.34 lakh in two years after an initial investment of 1.5 lakh for raising six emu chicks. The promotions were also endorsed by film stars such as R. Sarath Kumar and Sathyaraj.

The fraud was unearthed when Susi defaulted on monthly payments to investors. It had been paying old investors from cash raised from new ones, and when fresh recruitments started lagging behind payouts, the house of cards collapsed in classic pyramid scheme fashion, according to police. Promoters of six major farms in Erode fled with investors’ money, estimated at 70 crore by Tamil Nadu economic offences wing officials. None of the farm companies’ representatives could be reached for comment.

Government officials estimate that about 3.85 crore will be needed to take care of the abandoned birds for three months. An official, who didn’t want to be named, said the animal husbandry department has asked the government for funds, and this proposal is in the final stages of approval.

“Currently, we are taking feed from feed suppliers under the promise that once the funds have been released, they will be paid," said the official.

Is there a market for emu meat? Emu meat is said to be low in fat, and the oil derived from its body fat is supposed to have curative properties. Each bird grows to about 5-6ft in height. Breeders say a bird gives up to 20kg of meat and up to 6 litres of oil.

“It tastes like beef. Emu is also more of a game meat like kangaroo, eaten very occasionally in Australia, much like venison," said Chris Gregory, president of Australia’s Emu Industry Federation. “It takes a long time for people to begin accepting emu meat. In the majority of countries, people don’t know what an emu is, let alone emu meat."

India’s emus went from zero to thousand very quickly, he said. While the breeding of emus is the easy part, what needs to be in place beforehand is the ecosystem— processing, value addition and marketing. That wasn’t the case in Erode. “The bird needs different kind of processing. Unless meat processors recognize this, and regulations are in place, emu meat cannot be exported," Gregory said.

Leading poultry companies such as Venky’s (India) Ltd and Suguna Foods Ltd, and meat processor Al Kabeer said they wouldn’t be taking part in any emu meat auction that may be held by the Tamil Nadu government.

“It has no domestic demand. We have also studied the export potential of emu meat and found none. We’ve had no belief in the product right from the start," said G.B. Sundararajan, managing director of Coimbatore-based Suguna Foods.

Prasanna Pedgaonkar, deputy general manager at Venky’s, echoed this. “In poultry, in 1 sq. ft of land, we produce 12kg of meat in a year," Pedgaonkar said. “For emus, you will need acres of land. It is not a viable business. Also, for export, you will need a lot of infrastructure, which we don’t want to invest in as we see no potential in it."

But one entrepreneur said emu farming is a bona fide business that has got a bad rap because of the Erode fraud.

Vinay Sharma, a former Wall Street banker who used to work at Bank of New York Mellon Corp., runs Delhi-based Tall Bird Emu Farm, a 8 crore company.

“Internationally, there is a demand of 1.5 lakh litres of oil a month and we manage to sell only 10,000 litres a month," he said. “We export to pharmaceutical companies and cosmetic companies in Europe, USA and the Middle East. So the potential for emu farming definitely exists."

Emu oil, obtained from the fat deposited below the surface of the skin, contains pain-
relieving oleic acid and is beneficial for arthritis, he said.

“Emu meat is a new product in the country, and we have to create an organic market for it," Sharma said. “When it took eggs 14 years to become widely accepted as a part of breakfast (in India), we need to give emu meat some time."

Also, emu meat needs to be priced closer to other meat products to help popularize it, he said. A kg of mutton costs 350-375, while emu meat sells at 400 a kg, he said.

There are about 5,000 emu farms in the country, spread across states such as Andhra Pradesh, Orissa, Gujarat and Punjab, apart from Tamil Nadu, with about 250,000 birds in India. Perceptions about the business have become negatively coloured by the recent scam, feel the emu farm promoters from the other states.

Any likely auction of emu meat will harm the fledgling industry, Sharma said. “A volume tender is not the right way for doing away with the meat," according to him. “The animal husbandry department needs to lay out a long-term strategy to promote the industry and interact with slaughterhouses to slowly introduce the meat in the mainstream market."

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