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Vol 10 Issue 7 May 2015 Rs. 100/-
Mega Food Park
10th
Volume
QSR: the turning point of food hospitality
Global Standing of Indian Food Industry Basma Husain
Mega Food Parks Political Controversy Firoz H Naqvi
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Foodgrain stocks with FCI decline to lowest in 5 years Agri tourism enhances farmer incomes in Maharashtra by 33 per cent
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Coconut production in the country drops 10%
Keventer to roll out its Dwarf Cavendish bananas soon
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Kraft's macaroni and cheese to get a healthy boost
Experts praise FDA role in ensuring food safety
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McDonald’s gives Indian customers option to choose their own burger buns
Manpower shortage seriously affecting the functioning of food safety dept.
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Maggi Magical Masala row: Nestle to appeal against Madras High Court order which favors ITC
Paper Boat eyes volume deluge with Railways deal
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Complex regulatory regime impacting the development of food processing sector
Coca-Cola to acquire Chinese beverage firm for $400.5 million
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Amul Dairy polls to be held for 11 posts on May 12
Nestle in advanced talks to divest frozen food unit
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Mother Dairy analyzing to go for North-East's Rs 500 crore dairy whitener market
At 20%, Gujarat got highest share of investments in food processing
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Milk poured on road by dairy farmer
Kwality Ltd enters MoU with Jharkhand govt to set up Rs 100-cr dairy unit
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Government should promote ICAR tech to detect detergent in milk
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MoU signed by Haryana and Israel for animal husbandy dairy centre
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Bry-Air Adsorption
launches
Chillers
Vol.10 Issue 07 MAY 2015
CONTENTS
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9
6 financial targets
for long-term dairy success
20 Mega Food Park
Political Controversy 14
35
of running
Chocolate CafĂŠs
QSR: the turning point of food hospitality
39
19
The art
Food processing only sector
which can generate
huge employment opportunity
Red Politics
The Meat industry
predicament 23
Global standing
44
Breaking the Code:
How improving the coding process
can optimizebaked
goods manufacturing productivity
of the Indian Food Processing
Industry
46
Easy
Monitoring
of Production Processes
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Vol 10 Issue 7 May 2015
The views expressed in this issue are those of the contibutors are not necessarilly those of the magzine. though every care has been taken to ensure the accuaracy and authenticty in infomation, "Oil & Food Journal" is however not responsible fordamages caused by ministerpretation of infomation expressed and implied with in the pages of this issue. All disputes are not to be referred to Mumbai Jurisdiction
Vol.10 Issue 07 MAY 2015
his time I am not going to waste my editorial on these trivial issues that are born out of political malice. What I would like to discuss this time is much larger and a concern to review. I belong to the food industry but I also care for health of my children and rest of Indian kids and our young generation……of course! The Maggi issue…. This piece of news may not sound good for many 'Maggi' lovers as it may now face a ban in Uttar Pradesh after it has been found to contain harmful chemicals. The two-minute 'Maggi' noodles came under regulatory scanner after samples collected in Uttar Pradesh were tested in the lab and results showed that it contains high amount of monosodium glutamate (MSG) and lead. Shockingly, it has been found that Maggi contains 17 parts per million lead, while the permissible limit is only 0.01 ppm. The Lucknow Food Safety and Drug Administration (FSDA) have initiated an inquiry into the matter. It has written to the Food Safety and Standards Authority of India (FSSAI) in New Delhi urging it to cancel the license of Maggi. The Lucknow FSDA has also asked FSSAI to order sampling of the product from across the country to check quality However, Nestle, which manufactures 'Maggi' noodles in the country, has denied adding MSG to Maggi Noodles and glutamate, if present, may come from naturally occurring sources says Nestle spokesperson and has also added that the Food regulators in India also do not specify any limit for the presence of MSG / Glutamate. Kids love Maggi and it’s a fact but if Nestle is truly playing with the health of our kids I think a nationwide ban is mandatory. I know that Nestle is in the denial mode but I want to ask them how so much of MSG can come from naturally occurring sources. Uttar Pradesh has taken bold step to ban Maggi, I hope the truth unfolds and if the claim by Lucknow FSDA is factual we all need to join hands to protect the health of our people and the image of our food processing industry. And if Nestle turns to be correct we will keep on calling it “meri Maggi’’. Today my editorial seems to be very interrogative because now I am going to scrutinize WHO. As it has been recently exposed that largest food and beverage companies have strong influence on the policy making of WHO. A leaked mail from the International Food
EDITORIAL and Beverages Alliance (IFBA) has revealed the hectic lobbying by this alliance of the world's largest food and beverage companies to influence the framing of rules on the World Health Organization's (WHO) engagement with the private sector. Ever since the WHO started focusing on the global epidemic of diet-related ailments like cardiovascular diseases and diabetes, food and beverage companies have been trying to be part of the standard setting and policy-making activities of the WHO. The mail also revealed how the IFBA, which includes Coca Cola, PepsiCo, Nestle, McDonald's and Unilever, is being backed by the developed world-- several countries of Western Europe, Australia, Canada, Israel, New Zealand and the US-- who appear to have pledged to not accept any framework which excludes the food and beverage industry. Civil society organizations have been objecting to WHO clubbing private for-profit companies and business associations and alliances of such companies, along with big philanthropies, academic institutions and non-profit public interest groups under the head of non-state actors. It is funny that an organisation such a WHO is being intimated by these global players. Now the question is that is this organisation really worried about the health of the people or is alliancing with major food companies to lose the trust of the public…..a point to ponder by all. Finally coming to a good note, I am proud of our Union Minister of Food Processing – Harisimrat Kaur Badal for making efforts to make the Indian food processing Industry the world’s largest food processing hub. Given the huge production base of the country, the sector is very well positioned to elevate the agricultural economy, raise farmer incomes, and generate employment. Food Processing Ministry had allocated 17 mega food parks and is creating 30 cold-chain grid that will link farmers across the country. These humungous projects will providevarious facilities to food processors, farmers, retailers and exporters, helping achieve faster growth of food processing industries. If the government becomes dedicated to the food processing sector I know the sector will end up increasing the country’s GDP by several folds and craft a new global outlook for India.
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Mega Food Park
POLITICS
Firoz H Naqvi
Political Controversy A
mega food park provides various facilities to food processors, farmers, retailers and exporters, helping achieve faster growth of food processing industries. The government is working to ensure that affordable credit is available to entrepreneurs to set up food processing units across the country and will also create a cold-chain grid that will link farmers across the country with consumers.Tthe 30 new cold-chain projects, which will have a cumulative cold storage capacity of 1.12 lakh tonnes and daily milk processing capacity of 11.1 lakh litres, would entail an investment of Rs 724.9 crore. The ministry will provide Rs 274.9 crore as grant for these projects.
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Sanctioning of 17 mega food parks and 30 cold-chain projects will attract total investment of about Rs 3,077 crore according to the union minister of food processing – Harisimrat Kaur Badal. Under the scheme of cold chain, entrepreneurs get financial assistance of Rs 10 crore. A total of 138 integrated cold-chain projects were approved by the government, of which 108 are under implementation by the ministry. The operationalization of the 108 projects would create 3.64 lakh tonnes of cold storage capacity, 90 tonnes per hour of individual quick freezing capacity, 106.95 lakh litres per day of milk processing and 601 reefer carriers. As per an NSEL report, there is deficit
of 29 million tonnes of cold storage capacity in the country, as against the total requirement of 61 million tonnes. So far, only 32 million tonnes of cold storage capacity has been set up. But mega food parks which was to be the fiery stepping stone for the enhancement of Indian food processing industry has now become the arena of political vindictiveness. It all started when the government allocated 17 mega parks across the country but cancelled the Mega food park in Amethi. Let’s start from the beginning. The Centre allocated the development of 17 mega food parks across the country to state governments and private firms,
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POLITICS The scheme envisages one time capital grant of 50 per cent of the project cost (excluding land cost) subject to a maximum of Rs 50 crore in general areas and 75 per cent of the project cost (excluding land cost) subject to a ceiling of Rs 50 crore in difficult and hilly areas, including the North-East and J&K. The controversy 17 mega food parks had been sanctioned but interesting the NDA government put a full stop on Congress vice president Rahul Gandhi's dream to see his Lok Sabha constituency Amethi emerge as a major food processing hub. The NDA government has cancelled the mega food park project in Amethi.
including Adani Ports & SEZ, envisaging an investment of over Rs 6,000 crore. The Ministry received 72 proposals both from state governments and private players for the 17 food parks. 7 mega food parks have been allocated to state governments and 10 to private players The project cost to set up these 17 mega food parks would be Rs 2,030 crore, of which the central grant would be Rs 850 crore.An estimated investment of another Rs 4,000 crore would be from food processing units to be set up in these parks. Under the scheme (2008-09) of mega food parks, the Food Processing Ministry had sanctioned 42 projects throughout the country. Of these, 25 parks have already been allocated. The basic infrastructure in these food parks needs to be set up within 30 months. In each mega food park, 40-50 food processing units would come up. Five state governments -- Punjab, Haryana, Andhra Pradesh, Telangana, and Odisha --- have been allocated one food park each, while Kerala government has been allocated 2 food parks. Adani Ports and Special Economic Zone, Jain Agro Trading Company and Ruchi Acroni Industries are among 10 private
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players who have been allocated food parks by the Centre. In these mega food parks, 80,000 people are expected to get employment while 5 lakh farmers would also be benefitted. The Mega Food Park Scheme, based on cluster approach, is modeled on hub and spoke architecture. It aims at facilitating the establishment of a strong food processing industry backed by an efficient supply chain, which includes collection centres, central processing centre (CPC) and cold chain infrastructure.
The Rs 200-crore project was inaugurated in October 2013 by Gandhi, Aditya Birla Group chairman Kumar Mangalam Birla and former Union minister for food processing industries, Charan Das Mahant. It was the first such project in Uttar Pradesh which was to be set up by Aditya Birla Nuvo Limited in Jagdishpur, Amethi. While laying the foundation stone, Rahul Gandhi had said, "Farmers are the hardest working and they get least. That is why we are establishing a food park here." "The food park is being made with the aim that whatever is grown in Amethi should be processed here too. An agriculture hub
POLITICS should be established here, we want to bring change in Amethi and Jagdishpur. 40 industries will be established here it will help 40,000 people," he had said. On the cancellation of Mega Food Park in Amethi the Food Processing Ministry said that the company, Shaktiman Food Park Ltd, to which the project was allocated, did not fulfill certain conditions even after extension of deadline.The project was cancelled as the company was not able to fulfill certain conditions including possession of land within six months of the date of allocation.Shaktiman Food Park had informed the ministry that the project is unviable if gas at subsidized rate is not provided for the captive power plant, for which there was no provision under the policies for Food Park. The Ministry said, "Even the deadline was extended to two years but the company was not able to fulfill the minimum criteria of 50 acres of land. But congress alleged that the central government cancelled the food park project in Amethi which aimed at providing employment to some 40 thousand people, just because it was a dream project of the congress Vice President.The project would have helped the farmers of not only Amethi but also of the entire state. The congress side is saying that the Central government claim that the project was not viable or had
technical flaws are wrong as all the norms and formalities had been completed before its foundation was laid in October 2013. The park was aimed at giving direct or indirect employment to the jobless in 20 districts, providing market to the produce of the area and uplifting the economy of the area. And the cancellation of the food park is a clear indication of the anti-farmer thinking of BJP and Modi government. Uttar Pradesh is such a big agriculture state and there is not a single mega food
processing park the state. In fact BJP has so many MPs from UP and all the important ministers including the prime minister is from the state yet what has the state got, not a single food park. Retaliation The fight over the mega food park didn’t end in mere verbal combat but was taken and executed in the Lok Sabha that actually disrupted the session. With Congress vice-president Rahul Gandhi keeping up his advocacy of farmers’ issues in Parliament, the government fielded farmer’s son-turned-Minister Rajnath Singh to challenge the perception that the government is anti-farmer. Making his fourth intervention in the second part of the budget session, Mr. Gandhi sought an explanation from the government for cancellation of permission for a food park in his parliamentary constituency, Amethi. Referring to a stump speech of Prime Minister Narendra Modi in Amethi last year ahead of the Lok Sabha elections, Mr. Gandhi admitted that he had been impressed when the then Gujarat Chief Minister publicly said he did not believe in vendetta politics and was an advocate of the politics for change. “However, now we find that permission for the food park has been cancelled,” Mr. Gandhi said.
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POLITICS to point out any of those amendments as anti-farmer. It is the Congress that has done everything that it is now accusing the central government, she blamed. In another controversial face-off between Human Resources Development Minister Smriti Irani and Congress Vice President Rahul Gandhi, the former raised the issue of food park and lack of development in latter's constituency Amethi. Smriti accused Rahul of lobbying for corporates and questioned his absence from the constituency.
A resurgent Rahul Gandhi has now put the Government on the defensive by giving it an anti-farmer image, though Rajnath Singh in riposte assured Mr. Gandhi that the issue would be looked into, adding that the ruling party cannot develop the nation on its own. Later, the government’s floor managers suggested that the project did not take off because the company which was to develop it did not find it viable. But Harisimrat Kaur Badal, the Union Minister of Food Processing Industry, retaliated to Rahul Gandhi’s accusation with full vendetta. Sheallegedhim of "playing politics of deception" and "misleading" the people over a mega food park project in his constituency Amethi and asked him, “ Where were he, the project was cancelled on July 11, 2014.... Were you sleeping for 10 months? It is you who wants to resort to politics of revenge. Accusing Rahul of "not doing his homework" and playing "politics of deception" on the issue, she sought to ridicule the Congress leader for raising the problem of the potato-growers after returning from a foreign jaunt. She said Rahul had done precious little in the matter after the food park was given permission way back in 2010. She said the developers of the food park had not even laid the foundation by 2012 for which they were issued a show cause notice.
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The promoters wanted gas supply at concessional rates, but the then petroleum minister in 2013 had rejected the request, she said. Nirmala Sitharaman, Minister of State for Commerce & Industry said that Rahul Gandhi had gotten his facts wrong on the Amethi food park issue, the food park got six extensions, even during the UPA regime, post which they were found unfit and had to be rejected by the UPA itself. And the Land Bill is actually friendlier to the farmer than the legislation enacted by the erstwhile UPA government. Hence, to anyone who says he’s speaking for the farmer, he should — look at the nine amendments that NDA government have brought in and tell us which one is antifarmer. Till now, nobody has been able
Smriti Irani thinks that Rahul is taking up food park issue to lobby for corporates. Rahul has been missing all this while, where has he been? Why hasn't Rahul developed Amethi all this while?” she asked. Rahul has, in turn, challenged Smriti to revive the project in Amethi as he had accused the Narendra Modi government of playing revenge politics. Rahul said, "I hope Smriti Irani ensures Amethi's food park is set up." The issue also rocked the Lok Sabha where unruly scenes were witnessed. The opposition created ruckus on the floor of the House after Food Processing Minister Harsimrat Kaur Badal made a statement on the food park issue. She claimed that the project was delayed by the previous Congress-led government.
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The Mega food park has become more of an egotistical issue then a developmental issue, the congress blaming the NDA government for cancelling the food park in Amethi. The Union Food Processing Minister imputing Rahul Gandhi for misleading the country and the commerce minister saying that Rahul has not got his fact clear. But who are bearing the brunt of this fight - the farmers, while the so called political individuals are into verbal vendetta. Modification in mega food park scheme Amid all the disagreement and arguments regarding the mega food park, the government has approved some modifications in the guidelines of the mega food park scheme to boost investment in the food processing sector. The modifications, which include allowing the central government agencies
to hold more than 26 per cent equity in the mega food park, would streamline the implementation of the scheme. The modification will also bring central government agencies on par with state government agencies by removing the restriction of a maximum 26 per cent on their equity holding in the Special Purpose Vehicle (SPV) and allowing all government agencies to become shareholders in the SPV without any restriction on their shareholding. These modifications are expected to trigger further investment in the food processing sector and ensure smooth implementation of the Mega Food Parks scheme, particularly projects at initial phases of the scheme's implementation. The Scheme will be implemented in a market driven manner, commensurate
POLITICS
with both global and national demands. Innovative supply chain management would be the key to implementation of this scheme. The project proposals for focusing on the processing and preservation of perishable food products would be given weightage in selection. The government said that each mega food park is expected to benefit 6,000 farmers/ producers directly and about 25,000 farmers indirectly. The Mega Food Park Scheme, based on cluster approach, aims at facilitating the establishment of a strong food processing industry backed by an efficient supply chain, which includes collection centres, central processing centre (CPC) and cold chain infrastructure.
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Vol.10 Issue 07 MAY 2015
HOSPITALITY
QSR: the turning point of Food Hospitality The last decade witnessed major transformation in the food service business in the country. The proliferation of Quick Service Restaurants (QSR) has brought about a new eating culture. If trends are anything to be believed, QSR would continue to steer the growth in the food service industry for some time more. Oils and food journal ponders the factors that will usher growth of QSR format in the country Vol.10 Issue 07 MAY 2015
O
ne industry which has grown leaps and bounds leveraging the economic boom over the last couple of decades and hasn’t been impacted much by the recurring down turns is the food service industry in India. The growth has been consistently in double digits. With the growth, there has been an increase in segmentation into different formats. From a totally unorganized industry, the food service industry has transformed into an organized industry. The role played by international chains, their entry and rapid expansion, was a game-changer in this respect. Majority of these chains were Quick Service Restaurant (QSR) or Casual Dining formats. The brands that stand out
today in terms of brand presence in the market include McDonald’s, Domino’s Pizza, California Pizza Kitchen, Jumbo King, Pizza Hut, Papa John’s, KFC, etc. Analysis India's fast-food industry is expected to double in size between 2013 and 2016, to $1.12 billion, according to the Economist Intelligence Unit. And demographic trends mean it could become the next mega-market for international fast food players. The country's fast-food market today is only one tenth the size of China's, but unlike China, which saw a decline in
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HOSPITALITY
850 locations. McDonald's runs only 369 locations. Domino's now generates more than 17.2 billion rupees ($277 million) in revenue, compared with $222 million for McDonald's. Domino's, which is valued at $1.6 billion in India, has tried expanding its business by getting Indian consumers to view pizza as a meal replacement, and not just a snack.
fast-food sales last year, India's market is expected to grow, thanks to changing consumer preferences and the largest youth population on earth.
of its chicken-centered menu, which has worked well in India, according to Technopak, a management consulting firm in India.
It’s a revolution waiting to happen.India's population stands at 1.2 billion, but it has only a little over 2,700 chain fast food outlets, leaving most people unreached, according to Euromonitor International. Fast food has yet to broadly expand beyond the largest cities and India’s Prime Minister, Narendra Modi, has been a vocal advocate of increased foreign direct investment.
While the U.S. chains have "Indianized" their menus, showing that only partly explains the rising appeal of fast food in India.
The quick-service restaurant market is still very nascent, and there is ample space for more and more brands to come in. Like McDonald's tweaked about 70 percent of its menu for the Indian market, according to Euromonitor. That meant staying away frombeef in a country where cows have religious significance, and appealing to a population that tends to enjoy spicy food with options like McSpicyPaneer and Chicken Maharaja Mac. They've also opened some 100 percent vegetarian restaurants. (That said, contrary to perceptions, nearly 70 percent of India's population is non-vegetarian.) MacDonald’s has localized its menu and due to this, they are not just seen as an international brand, but one which the people of India feel comfortable with. KFC, owned by Yum! Brands, had a slight edge over McDonald's because
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The country has 356 million people between the ages of 10 and 24, giving it the world's largest youth population, according to a United Nations report. With more young people entering the workforce daily, growth in the economy, a rising female work force, and increased mobility among consumers, the traditionally difficult Indian market has become hungry for a more diverse menu. A challenge for America's fast-food joints in India has been to maintain the cohesion of the global brand while still appealing to the local market. There is an extent for localization and one can't tamper with the global brand, it has to be same as anywhere else in the world. A market like India, long dominated by homegrown businesses, can be targeted through strategies other than just customization. Domino's introduced its 30-minutes-or-free delivery in India, for example, despite the country's famously difficult traffic jams. Today, Domino's has more restaurants in India than any Western competitor does, with more than
When it comes to the fast-serve coffee industry, most Indians still refrain from the American habit of daily, morning drinking before and during work. To get around the cultural challenge, Dunkin Donuts entered the food market, offering fast-food sandwiches—the only country where the chain does so. What's important for an American brand to understand is that the Indian terrain is atypical—consumers are clearly most demanding, and there is too much focus on food. Market size According to India Food Services Report 2014 commissioned by National Restaurant Association of India (NRAI) with the help of Technopak the food services market in the India which is currently valued at Rs 247,680 cr (USD 48 bn) is projected to grow at a Compound Annual Growth Rate (CAGR) of 11 per cent over the next five years to reach Rs 408,040 cr (USD 78 bn). At the same time, the growth in the organized QSR segment in the country over the next five years would be much higher compared to any other formats – be it casual dining, fine dining, café, etc. The QSR segment which is estimated at Rs 5,500 cr (USD 1,060 mn) in 2013 is projected to grow at a CAGR of 25 per cent to reach Rs 16,785 cr (USD 3,230 mn) by 2018, the report said. The total share in the food services market of the QSR is projected to go up from the current 43 per cent to 50 per cent in the next five years. If one add, Cafes and Frozen dessert/ice cream parlours, which are also QSR in terms of operational and service models, the share that this
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HOSPITALITY
segment going to command would be much higher. Another market research agency, CRISIL, also reported a similar growth projection for QSR segment earlier this year. Their study predicted almost double growth in QSR market size from Rs 3,400 cr (201213) to Rs 7,000 cr in 2015-16. There will be 16 to 18 per cent addition in terms of QSR outlets annually over the next two to three years, the study says. Organized chains, which are largely focus on metro, Mini-metro and Tier I cities today, will start moving into Tier II and III cities in the coming years. 40-45 per cent new outlets will be in these smaller towns and cities, CRISIL said. Growth expediters The growth projection is made considering the burgeoning demand that is going to come because of rapid demographic changes happening in the country. When demand drivers for convenience food in the market would be rapid urbanisation and burgeoning young and aspiring population with higher propensity to spend on comfort and luxury who love to eat out on a regular basis, the supply side drivers, according to industry pundits would be, influx of new international QSR players into the market and exponential expansion of existing international and domestic players in the market. The young and working population which comprises 60 per cent of the total population of India, who are aware and exposed to global cuisines will be a great
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demand driver for QSR in the country. Most of the industry players expressed similar sentiments. The transformation of Indian consumers’ lifestyles over the years has tremendously helped the IEO (Informal Eating Out) industry to grow and expand. Today, eating out is no longer considered as just an occasion-driven activity like it was a few years back. With increasing number of people eating out (from three times a month a few years back to eating out approximately seven times a month today) the industry offers major opportunities to the players to capture a larger consumer base. From a business model, QSR’s has scalability through different ownership models – own, franchisee, mix of ownership and franchisee, revenue sharing, etc. The format is not complex as other food services formats like casual or fine dining restaurants. QSRs are differentiated for their speed of service, affordability and convenience. While the international
chains in this space focus and specialize on a single cuisine or product category, like Burgers, Pizza, wraps, sandwiches, etc., Indian QSRs offer multiple cuisines and products. Many international fast food brands are currently exploring India entry with the support of Indian private equity funds. Such brands see lot of opportunities in the Indian market as economic trickles to smaller townships and cities. Funds are no more an issue for new ventures. Recently there has been a spate of Private Equity (PE) investments and funding in several new projects. Even early stage funding is a possibility in India today, which was never the case earlier. A unique product, which is aspirational, headed by the right person, and has all systems that make it scalable and last but not the least is ‘simple’ has a tremendous advantage over the other products. This period is one of the better periods for the hospitality industry. QSR segment is pegged at Rs 5500 crore forming about 43 per cent of the total chain market size and is estimated to touch Rs 16,785 crore by 2018. Figures suggest that this format is going to witness a rapid growth and expansion in coming times. The future prospects in this segment will
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HOSPITALITY hardwork into establishing the brand. MacDonald pioneered the cold storage or the cold chain management system in the nation which today is iconic in its space. Their supply chain, coupled with focus on menu innovation, dedication to offering customers the best in service and value has helped it create connect with our customers. International chains have an ‘aspirational’ advantage in whichever market they enter. These chains have perfected the ‘cookie cutter’ model with fool-proof systems and processes. The products are so simple and do not require the service of chefs in most cases, that helps them to ‘keep a check’ on costs.
automatically attract PEs and Venture Capital funds into it. Advantage to international brands Although fast food had deeper roots in the Indian milieu, it was the international brands that proliferated fast with the market demand. The Indian home-bred brands largely confined themselves to their small geographical territories for various reasons. Today, Domino’s has over 630 outlets across India. Other international brands that also have strong presence include Subway (390 outlets), McDonald’s (330), KFC (240) and Papa John’s (30). What stops Indian QSR brands? Answer; The international brands have been in this business far longer than any Indian brands. They have oodles and oodles of experience. The back end integration, centralized commissaries , distribution channels, vendor development, training resources and most of all capital backing has been tremendous by these companies, which India QSR’s didn’t have that kind of bandwidth or capital. However, Indian QSRs are also catching up fast; Brands like Ammi’s Biryani, Kebab Express, WahJiWah, Southee, Kaati zone, Adiga’s, Goli, etc are a few examples. “They are now getting the backing of PE funds as well as Venture Capital (VC) and Angel Funds. This is a
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very positive sign, and may be very soon there will be a few dozen Indian QSR brands going global. International QSR’s have the added advantage of scale internationally thereby giving them a head start in any market that they start in just by their well-known names such as McDonalds or Subway. This trend, however, is changing, not necessarily in the QSR space but in the restaurant space such as Mainland China, Moksha, etc. In the coming years a few more pan India players in the QSR space will be seen as well. When McDonald’s entered the Indian market, they spent the first six years to set up supply chain infrastructure in the country. They put a lot of investment and
There are also huge opportunities for Indian cuisine promoters in the QSR space. Indian cuisine and country are both vast and people are traveling frequently on business and leisure. There are various joints in most cities that have been in business for ten or over twenty years that are renowned for its local cuisine and their products are famed and soughtafter far and wide. One can’t reinvent the wheel - quirky marketing ideas, innovative food presentation of tasty food and merchandising at a price point that’s affordable and a meal served in a reasonably quick time is the way forward. Franchising, owner-management, kiosks, drive/cook-in vehicles could be looked at for expansion. Opportunities & Challenges
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HOSPITALITY The other argument will be people will not eat this food, but Indian food and Indian QSR’s will really crack the code if they move into the smaller towns. Then the argument will come where will the staff come from, well you have a whole work force from the small town itself, you are building the community, and you need to invest in training and training cells. A hub and a spoke model will be perfect to handle the logistics. What is to be done?
At present, almost 80 per cent of the QSR businesses are restricted to metro, minimetro, and Tier I cities in the country. India with its 1.3 billion population base, and strong domestic economy, is undoubtedly a market for any business. The rapid urbanisation that is happening in India will effect a demographic change in the next decade. It is expected that almost 35 per cent of Indian population will be living in urban areas by 2022. Improving connectivity and accessibility will definitely throw up new opportunities for organized players. The Tier 2 cities have malls that create an ambience of modernity and youthful exuberance that have become preferred venues for families to spend an entire offday in, this will generate greater demand for QSR Brands in these environments, it all started in the same way for Tier 1 and Metro cities too. Who wants to eat a branded food product if they can’t be seen having it?? There are always going to be logistical hurdles in order to grow brands in Tier II and III cities, but the brands that invest there will continue to have growth away from the ‘clutter’ in Metro cities.” There are quite a few challenges for international and domestic chains to go and set up outlets in smaller towns and cities. “Price point, menu selection, etc. are bit challenging in these smaller towns. The other major challenge is to
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get the right staff. The scale is the biggest challenge and in all the other cities it is easy to create several shops or retail outlets, which is not the same in the higher tier cities. The issues related with logistics, cold chain, supply chain, etc., is another bottleneck. A big challenge is to change the mentality of the people in smaller towns to ‘spend a limited amount of money on eating out’, which in the prevailing situation makes QSRs unviable in smaller towns. However these challenges would be overcome over a period of time. In terms of challenges they are as big or small as the big cities. The rentals will be far cheaper, the markets are yet untapped.
The average price point for a QSR in India is between Rs 75 and Rs 250. The affordability factor is the key for convenience food to be successful and appealing to the masses. In order to make the venture profitable in this price point bracket, promoters have to evolve strict systems and processes. Menu selection, location and price point are keys for a successful QSR. Key elements for success for QSR are clarity and focus of the concept, standardization, familiarization, the backend and supply management, investing in processes and procedures, vendor development, professionalization and technology, speed and efficiency of expanding, training and re-training of resources and investing in their growth and a succession plan, and ensuring the employees become stake holders in the company.
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MEAT GROWTH
Red Politics
The Meat industry
A
predicament
s a centuries-old dispute over beef intensifies in India, meat traders are in the middle. The growing no-beef agenda threatens to disrupt an industry that expanded under secular governments that promoted agriculture in India, which saw farm exports grow faster than any other nation over the past decade. India's annual beef exports are the world's second-largest, jumping 11- fold in a decade to $4.35 billion. During the past year, hardline Hindu groups have stepped
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up efforts to end cow slaughter and combat a network of small, illegal plants that produce cattle meat for domestic use. The atmosphere in the abattoir has become very tense and the industry doesn't know how to deal with this and everyone from transporters to dealers and farmers is scared. The country ranks sixth in the world among beef consumers, and demand is up 4.2 per cent in the past five years. Much of the industry's growth has been in exports to Vietnam, China and Africa. Shipments will total 1.95 million tonnes this year,
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MEAT GROWTH selling or possessing beef faces a 5-year jail term and a $200 fine, a huge sum for poor Indians. Within days of the ban, the red-meat business in Mumbai, the state capital, was forced underground, leaving restaurants and eateries scrambling for alternatives. Meat traders in Maharashtra have challenged the ban in court, saying tens of thousands of people have lost their jobs. The state's decision did not come as a surprise. During his election campaign, Modi promised a countrywide ban on cow slaughter, and that has emboldened Hindu hardliners.
more than triple what was exported a decade earlier, the US Department of Agriculture estimated in an October report. Only Brazil sells more overseas. Beef exports fetched $4.4 billion in 2013-2014, compared with $395 million a decade earlier, according to the stateowned Agricultural & Processed Food Products Export Development Authority. By comparison, the US exported $6 billion of beef in the recent financial year. Indian beef sells for $100 to $200 less per tonne than meat from its main competitor. Understand Effect on meat business But the business is big. Despite Hindu beliefs that cows are sacred — and the fact that their slaughter is banned in most of the country — India is the world's fifth-largest consumer and second-largest exporter of beef. The meat, which in India comes from bulls and buffaloes, is widely eaten in some communities, particularly by low-caste Hindus and millions of Muslims and Christians. With the victory of Prime Minister Narendra Modi's Hindu nationalist BharatiyaJanata Party last year, hard-line Hindu groups are pushing to expand the slaughter ban to include all types of cattle, male or female. Meat traders, many
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of whom have carried their trade for generations, are worried about their jobs. Fears among meat traders grew last month when India's second-most-populous state, Maharashtra, extended the slaughter ban to include bulls. While buffalo was not mentioned in the new law, buffalo meat quickly disappeared from most of the state's butcher shops, amid fears of communal violence if it was confused with cow meat. The ban carries a stiff punishment: Bail is not allowed and anyone convicted of
Other states ruled by Modi's party have promised to follow Maharashtra's example. The government in Haryana state, bordering New Delhi, is considering laws making cow slaughter comparable to murder. Offenders would face a life term for killing a cow or bull if the state adopts the planned legislation. In recent decades, as millions of Indians traveled abroad for study and work, tastes have slowly changed. Today, many restaurants and small eateries serve steak and kebabs made from buffalo meat. Many people who in the past would not have eaten the meat at home in deference to strictly vegetarian parents and older relatives now openly broil buffalo meat.
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MEAT GROWTH
Sitharaman, says that the country has exported red meat to the tune of 15,91,581 MT (metric tonnes) till February. The figure for the same period last year was around 10,56,118 MT, which is lesser by 5,35,460 MT. In terms of revenue, there is a 19 per cent increase compared to the previous fiscal year. ‘Red meat’ includes the meat of both cows and buffaloes. The meat of sheep and other poultry are being exported under a different category.
Economists say a complete ban on cow slaughter could prove counterproductive as farmers would abandon their animals once they stop giving milk. Worse, farmers may consider it economically impossible to keep cows altogether if they must feed the animals for the rest of their lives. The ban could also spell disaster for India's beef exports, which have grown quickly over the past decade, increasing annually in recent years at 17-19 percent. This year, exporters were expecting a 25 percent increase. They hope they won't be hit hard, but they are anxious. Nearly $5 billion worth of buffalo meat was exported in 2013, with most headed to Southeast Asia and Persian Gulf countries. And it’s not just meat exports, but leather and leather goods, tallow, bone meal and other animal product exports that will also suffer.For many Indians, a ban would be an unwelcome government intrusion into their personal lives. Export still up! The timing could not have been worse. At a time when the touchy subject of “beef eating” is turning into a national controversy due to the ban imposed by the BJP-Shiv Sena Government in
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Maharashtra, a government body has found itself with hot statistics on beef. Its hands, no wonder, are shaking. As per the statistics the Agricultural and Processed Food Products Export Development Authority (APEDA)—the government’s gatekeeper for exports— the production and export of red meat have registered a steady jump during the BJP Government. The figures being collated by the APEDA, under the Commerce Ministry headed by Nirmala
Weirdly though the cow meat controversy is going on, the export of red meat is steadily increasing this year and it may even go beyond an increase of 25 per cent compared to the previous fiscal. The figures are showing a steady increase in the first two months of this year as well. This is the first time that meat export from India has surpassed the export of basmati rice for the first time. The APEDA was planning to publish this huge jump as a “success story’’, but put on the brakes to its publicity exercise following the recent controversy. It was only last week that President Pranab Mukherjee gave his assent to the Maharashtra Animal Preservation (Amendment) Bill, 1995, nearly 20 years
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MEAT GROWTH red meat is the opening up of the Russian and Chinese markets. Though the Western countries are yet to have a liking for the taste of out red meat, the Asian countries love it. With China becoming the new market, it is expected to grow even more. Even as states like Maharashtra and Haryana ban beef and impose strict punishment in case of violation, there has been a continuous growth in the export of the meat in the past three years. US department of agriculture shows that India has been the largest exporter of beef in the world since last year. While it remains the largest exporter of beef, according to the UN Comtrade data, India’s share in global trade of animal products for 2013 stood at 0.89 per cent.
after the Maharashtra Assembly passed the Bill during the Shiv Sena-BJP rule in 1995 in the state, thus making eating beef a political issue of national significance. The sale and possession of beef are now punishable by a jail term of up to five years. Given the controversial nature of the subject currently, the APEDA may limit it to the usual ‘Red Meat Manual’, a routine annual publication of the APEDA. This spurt in figures can make the BJP Government’s face red as its leaders, including Prime Minister Narendra Modi, had never missed a point to attack the previous UPA Government for using “pink revolution” as a means for minority appeasement. “This country wants a Green Revolution but those at the Centre want a Pink Revolution,” Modi had said in one of his election rallies criticizing the UPA for its “beef friendly” policies. Modi was right as the red meat export had witnessed a 45 per cent increase during the UPA-II government. Under India’s Export Policy 2012, export of “beef of cows, oxen and calf” is prohibited but “meat of buffalo (both male and female)” is allowed. Gelatin and glues derived from bones, hides and leather are also placed in the “free”
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(allowed) category. Despite the official ban on the export of cow meat and the meat industry’s claims that all its beef comes from buffaloes, it is an open secret that cow meat is sneaked into the buffalo beef market. This is done mostly by smuggling cows to states like Kerala and north-eastern states, where cow slaughter is not illegal. India currently exports meat to 65 countries with the main ones being Vietnam, Malaysia, Thailand, Egypt, Saudi Arabia and Jordan. The main reason for the spurt in export of
Politics over beef notwithstanding, India has been flagging the issue of market access of buffalo meat with China, Indonesia and the EU, which have halted meat import from India citing reasons like prevalence of foot & mouth diseases. Reasons for India’s meager share in world trade include high consumption base, relatively low productivity, prevalence of various livestock diseases such as foot and mouth disease, impeding market access to Indian livestock products, several quality, and non-tariff issues from major competing countries.
WORLD MARKET
Basma Husain
Global standing
of the Indian Food Processing
Industry
T
he Indian food industry is poised for huge growth, increasing its contribution in world food trade every year. In India, the food sector has emerged as a high-profit sector on the back of the scope it offers for value addition, particularly with the food processing industry getting recognized as a high-priority area.
country’s total food market, the food processing industry is one of the largest industries in India and is ranked fifth in terms of production, consumption, export and expected growth. The total food production in India is likely to double in the next 10 years with the country’s domestic food market estimated to reach US$ 258 billion by 2015.
has been instrumental in the growth and development of the industry. The government through the Ministry of Food Processing Industries (MoFPI) is making all efforts to encourage investments in the sector. It has approved proposals for joint ventures (JV), foreign collaboration; industrial licenses and 100 per cent export oriented units.
Accounting for about 32 per cent of the
The role of the Indian government
The Indian food processing industry
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WORLD MARKET
India’s regional and cultural diversity is perfectly reflected in food. Every state in India has something unique to offer. For e.g. South Indian, Guajarati, Bengali, Rajasthani and Punjabi delicacies are different and are admired in many parts of the world. But they haven’t been able to make inroads in other countries the way McDonald’s, Domino’s etc. has done in India. This is because lack of creativeness, innovation, branding and most importantly shallow pockets of Indian manufacturers.
accounts for 32 per cent of the country’s total food market, 14 per cent of manufacturing GDP, 13 per cent of India’s exports and six per cent of total industrial investment. What is food processing industry (FPI)? Right from the cultivation and harvest of crop, upto the consumption of product by consumer, there is certain degree of value addition in every product. This value addition can be of numerous types. As it goes from producer, to wholesaler, to retailer and finally to consumer, every stage adds some value to the product. In this value chain there may be value addition by Sorting, grading, packaging, branding etc. These activities not makes product attractive, more usable, gives choice and awareness to customers and also enhances shelf life of products. Apart from this service rendered by intermediaries to pass on product from producer to customer is also valuable. Most of the agricultural products are not consumable in their original form, for which they are processed. Wheat is converted into flour, Paddy into rice, sugarcane into jagery, Sugar, ethanol, alcohol etc. These products can be further processed such as flour into bread. Apart from this, left over part of crop such as risk husk can also be processed to get
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some useful product for e.g. Rice Bran oil, cattle feed, Sugarcane bagasse can be used for power cogeneration. Hence, food processing not merely adds value to the agro products, but also increases their utility. We know that activities in an economy are broadly divided into Agriculture, industry and Services. Food processing Industry is the product of agriculture and Industry. Where India stands and why food processing is important? India Food Processing Industry is estimated at $135 billion industry which is growing at about 8% annually. This growth rate is significantly more than agricultural growth rate which remains around 4%. These signals indicate toward phenomenal shift toward food processing from traditional ways. GDP by processing constitute about 10% that of agriculture. But given potential of India, this is an underachievement. India has about 26 types of different climatic conditions, 46 varieties of soils are there in India out of total 60 types of soils worldwide. 127 ‘agro climatic zones’ have been identified in India. Also, Indian food is known worldwide for its unique taste and aroma.
India is largest producer of Pulses, Mangoes, Banana, Milk, ginger, Buffalo meat and 2nd largest producer of rice, wheat, potato, garlic, cashew nut, groundnut, dry onion, green peas, pumpkin, gourds, cauliflowers, sugarcane, and tea in the world. We produce 17 per cent of the global total of vegetables and 14 per cent in the case of fruits. About 40 percent of the world’s mangoes and 30 per cent of the world’s bananas and papayas are produced in India. Further, India has many unique things to offer such as Alphonso Mangoes and wheat of Madhya Pradesh is uniquely protein rich. No surprise, that India is net exporter of agricultural products. But value addition of Indian product remains quite low. Indian Manufacturers haven’t moved much ahead in value chain. Say If mangoes are processed in to Mango Juice or pulp; it will result in more value addition, industry, employment, GDP and foreign exchange, but we export mainly mangoes as it is. Indian agriculture is infested with postharvest wastage problem. In category of fruits and vegetables it is about 30-40%. Overall, cost of wastage is estimated at about 18% ranging from 50000 crores to 1 lakh crore. Wastage is attributable to several factors including non-availability of facilities for sorting, grading, packaging, storage, transportation, cold chain and low level of processing of agricultural produce. Food processing can halve this loss. Consequently farmer will able to get more value and consumer will get products cheaper. Consumption patterns in India are rapidly
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shifting from cereals to protein rich foods and horticulture. Also India has significant proportion of population which is under nutrition (1/3 of population), stunted and wasted. Horticulture and fruits are much desirable for this problem and wastage reduction will have decisive impact here. Food processing has potential to turnaround whole economy. Indian economy is still agrarian, because about 55% population is directly dependent upon agriculture. FPI directly targets farming sector as it attempts to create more types of products out of single crop. This will increase demand for farmers and hence more remunerative prices. India’s demographic dividend is much talked about and most of this lies in rural India. Indian youth is turning away from agriculture because of low profitability. FPI is perhaps best bet to seize opportunity of demographic dividend. It can give us a genre of progressive rural entrepreneurs. Prosperous countryside will have multiplier positive impact on socio-economic and political problems. In short, FPI can narrow gap between rural and urban India. Apart from this India’s economy is under transition, Income classes are moving upward. Every year millions of households are coming out of poverty to be part of middle class. Per capita income is Increasing as GDP growth rate is much higher than population growth rate. This is complimented by growing urban culture, nuclear families, working couples. This makes case for processed food compelling. Consumption in India is gradually tilting towards packaged and ready-to-eat foods. Demand is bound to increase, but it has to be seen that to what
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extent opportunity is seized by Indian industry and how much is left for foreign companies. FPI is employment intensive industry; it can be an answer to jobless growth of past decade. Currently, only 3 % of employment is in FPI, while in developed countries it handles 14% population. Again, much of the employment will be created into rural India. This can remedy problem of distress migration. Growth in direct employment in the organized food processing sector stands at 6 % between 2011 and 2012.
WORLD MARKET
in 2014 was estimated to be around Rs 5,000-6,000 crore (US$ 800.19-960.12 million). We are growing at 20-30 per cent month-on-month. The poultry sector of India is expected to register double-digit growth in 2015 on the back of stable feed prices and encouraging rural demand. Also, strategic geographic location and proximity to food-importing nations (Middle East and Africa) makes India favorable for the export of processed foods. Last but not the least, world economies are integrating even rapidly year by year. So a country has no option but to remain competitive.
Indian food service industry is expected to reach US$ 78 billion by 2018.The Indian gourmet food market is currently valued at US$ 1.3 billion and is growing at a CAGR of 20 per cent. It is expected to cross US$ 2.8 billion by 2015. Indian food brands are increasingly finding prime shelf space in retail chains abroad. These include Bikanervala Foods, MTR ready to eat foodstuff and ITC’s Kitchens of India. The online food ordering business in India is in its nascent stage. Share of online food ordering would be in single digits of the overall food ordering business which
Global scenario Food processing is one of the largest global sectors at $7 trillion annual production. Look around and you’ll find companies of Cold drinks, Wafer chips, Juice, restaurant chains to be among biggest ones. Italian pasta and pizza is now consumed in almost all countries, so are the burgers and sandwiches. Sugar free products, cornflakes, oats, ketchups etc. are among most demanded consumer goods. Currently only 2 % of India’s vegetable and fruits production is processed. In comparison USA and China processes their 90% and 40% produce. Other developing countries, such as Thailand, Philippines, and Brazil are processing as high as 30, 78 and 70% of their produce. India’s food processing sector ranks fifth in the world in exports, production and consumption. Importance of this sector is significant
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WORLD MARKET
can be relieved by timely offloading of stocks. Storage of Horticulture products – Mainly NAFED – it also owns godowns and cold stores.India is currently having severe shortage of cold storage facilities. Significant majority of cold storage facilities were created between 2000 and 2011, assisted to some extent by interventions from National Horticultural Board (NHB), National Horticultural Mission (NHM), Horticulture Mission in North East and Himalayan States, Agricultural and Processed Food Products Export Development Authority (APEDA), Ministry of Food Processing Industries and Department of Animal Husbandry & Fisheries.
and it deserves a priority treatment by government. Accordingly sector has been made part of ambitious ‘Make in India’ initiative. Infrastructure Supply Chain – Any product is mobilized from producer to consumer to be consumed. This route is called supply chain. This movement involves both time and costs. Lengthier supply chains will push prices upward and result in more wastage. In last articles regarding marketing of agro-products we came across various government policies and institutions, which among other things, increase number of intermediaries. Adequate storage facilities, direct farming, contract farming and negotiable warehouse receipt system are mechanisms to streamline, strengthen and shorten the supply chain. Apart from these issues other major interventions and investments are needed in infrastructure sector, which is backbone of food processing industry. We have seen that India is biggest producer of numerous fruits and vegetable. Most of these are perishable and have very low shelf life. This is the major reason for high percentage of wastage. Their shelf life can be increased by adequate investment
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in infra such as cold storage, reefer vans, radiation plants etc. Storage of foodgrains – FCI deals only in food grains and about 67 per cent of the storage capacity is concentrated in the six major procuring states namely, Punjab, Haryana, Uttar Pradesh, Andhra Pradesh, Rajasthan and Uttarakhand. Several States have emerged in recent years as important states for foodgrains procurement, namely, Bihar, Odisha, Jharkhand, West Bengal, Madhya Pradesh and Chhattisgarh presently account for 13 per cent of the current storage capacity. Under the National Storage Policy, the bulk grain handling facilities are now being created on the Built Own Operate (BOO) basis at identified locations in the country. Much of the problem here
Cold stores are to some extent product specific. Majority of the cold stores in India are dedicated to potatoes. There are some that provide storages for chilies, dry fruits, spices, vegetables etc. Cold storage for meat, fish, milk and milk products and for other commodities such as spices account for only 1 percent of the total cold storage capacity. These cold storages are also usually smaller in capacity. Nearly 96 per cent of cold storages are in the private sector and about 75 percent capacity of cold storages is used to store only potatoes while another 23 per cent fall under the multi-product category. Value addition
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WORLD MARKET
Suppliers to a producers or trader lie on upstream side, where as customers lies on downstream side. This will change according person under observation. For a farmer, supplier of seeds and fertilizers lie on upstream, while cold store owners, farm contractors, mill owners, traders in agro output lies on downstream. When a particular person in supply chain assume role of two levels it is said integration. If PepsiCo instead of procuring potatoes (for chips) from farmers get potatoes captively from its own lands, it will be called backward integration. On other hand if farmer puts up a processing plant for chips, or a cold storage, this will be called forward integration. Direct farming is also a forward integration, where farmer assumes role which was played by commission agent in APMC. Forward and backward integration, also called vertical integration, is common in any business and it saves the costs associated with supply chain. Business which pursues integration strategy, earns a competitive edge. For example Reliance Industries owns oil and exploration business, refining business, retail outlets for petro products, and is India’s biggest polyester manufacturer. Consequently RIL has almost monopoly in these sectors. In farming and food processing, vertical integration can work wonders. For this farmer needs financial and technical support. Agriculture in India already is overemployed. This with seasonal nature of majority of farming crops gives farmers a compelling reason to get into food processing business. Investments According to the data provided by the Department of Industrial Policies and Promotion (DIPP), the food processing sector in India has received around US$ 6,215.46 million worth of foreign investments during the period April 2000—January 2015. Some of the major investments in this sector in the recent past are: • Foodpanda.in has acquired food ordering portal Just Eat India in an all-stock deal as
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it plans to strengthen its presence in India.
acquisition in six months.
• Gujarat Cooperative Milk Marketing Federation (GCMMF), popularly known as 'Amul', plans to invest Rs 5,000 crore (US$ 800.18 million) to set up ten new processing plants as well as expand the current capacity to touch 32 million litres per day (MLPD) capacity by 2020.
• ITC Ltd plans to invest Rs 1,000 crore (US$ 160.03 million) for its ambitious foray into dairy and juice businesses which it plans to roll out in the JanuaryMarch quarter of 2015.
• Restaurant search service Zomato is in discussions to raise about US$ 100 million in a fresh round of funding. Zomato is now present in 22 countries and over 500 cities around the globe. •Online restaurant search service Zomato has acquired Urbanspoon, for an undisclosed amount, in an all-cash deal marking its entry into the US. This is Zomato’s sixth
• Papa John’s India Inc. plans to merge with the Pizza Corner brand to become the third-largest pizza chain in India.
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WORLD MARKET has also approved the setting up of five numbers of Mega Food Parks in the states of Bihar, Maharashtra, Himachal Pradesh and Chattisgarh. • The Indian Institute of Packaging (IIP) has planned to offer a packaging solution to the famed Tirupati ‘Laddu’ to enhance its shelf life. They have also planned to install automatic vacuum packaging system for the packaging of ‘Laddu’ with higher shelf life.
Government Initiatives In order to promote food processing industries, increase level of processing and exploit the potential of domestic and international market for processed food products, Vision Document-2015 was prepared by the Ministry, which envisaged trebling the size of investment in the processed food sector by increasing the level of processing of perishables from 6 per cent to 20 per cent, value addition from 20 per cent to 35 per cent and share in global food trade from 1.5 per cent to 3 per cent by 2015. To achieve these targets, an investment of Rs 100,000 crore (US$ 16 billion) is required by the year 2015. Some of the major initiatives taken by the Government of India to improve the food processing sector in India are as follows: • Ms. Harsimrat Kaur Badal, Union Minister for Food Processing Industries, Government of India has inaugurated the first of its kind Rs 136 crore (US$ 21.76 million) mega international food park at DabwalaKalan, Punjab. 1. Ministry of Food Processing Industries has a scheme for human resource development (HRD) in the food processing sector. The HRD scheme is being implemented through State Governments under the National Mission
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on Food Processing. The scheme has the following four components: Creation of infrastructure facilities for degree/diploma courses in food processing sector Entrepreneurship Development Programme (EDP) Food Processing Training Centres (FPTC) Training at recognized institutions at State/National level • The Food Safety and Standards Authority of India (FSSAI) under the Ministry of Health and Family Welfare has issued the Food Safety and Standards (Food Product Standards and Food Additives) Regulations, 2011 and the Food Safety and Standards (Contaminants, Toxins and Residues) Regulations, 2011 which prescribe the quality and safety standards, respectively for food products. • The Ministry of Food Processing Industries has taken some new initiatives to develop the food processing sector which will also help to enhance the incomes of farmers and export of agro and processed foods among others. The government
Road Ahead Further,the adoption of food safety and quality assurance mechanisms such as Total Quality Management (TQM) including ISO 9000, ISO 22000, Hazard Analysis and Critical Control Points (HACCP), Good Manufacturing Practices (GMP) and Good Hygienic Practices (GHP) by food processing industry enable adherence to stringent quality and hygiene norms and thereby protect consumer health, prepare the industry to face global competition, enhance product acceptance by overseas buyers and keep the industry technologically abreast of international best practices. The allocation of Rs 2,000 crore (US$ 319.98 million) as a separate National Bank for Agriculture and Rural Development (NABARD) fund for food processing industries during the Union Budget 2014–15 is all set to give a big boost to this sector in India
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DAIRY
6 financial targets for long-term dairy success
I
n an ever-changing industry, you never know when feed costs will soar and milk prices will fall.
importance of a well managed and upto-date balance sheet that encompasses all aspects of the operation in order to accurately manage financials.
“All you can do is be prepared for challenging times,” explains Lonnie Wells, an associate from the Russell Consulting Group of Panora, Iowa. A breakout session presenter at the 2015 Pennsylvania Dairy Summit, Wells outlined tips and plans to achieve longterm success on dairy farms. Throughout
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Wells encourages producers “bulletproof” their balance sheets.
the discussion, Wells focused on the
to
“Producers must establish financial goals and position the business so that it can remain viable in challenging times,” he said. However, once a goal is defined, producers must commit to the goal and
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DAIRY ratios and compare the values to industry benchmarks. By knowing financial standings, producers will make more appropriate cost management decisions. In addition to cost management, producers must also be proactive in controlling other risks. It is important to be aware of risks and the probability that your operation will be affected. Producers can transfer the cost of an undesirable outcome to insurance companies. By purchasing insurance and locking in prices for milk and feed, producers can reduce the impacts of such events as accidents, natural disasters, low revenues and increased operating expenses.
discipline themselves and their finances in order to achieve success. Before setting any goals, be aware of your surroundings. Utilize resources to obtain a complete financial analysis of your current operation and identify your weaknesses. Once you know your current financial state, you can set goals and objectives for a business plan. To minimize financial stress, producers must maintain a strong balance sheet and stay in line with the financial targets established by the industry. Financial targets 1. Working capital = 50 percent or more of annual expenses o Working capital is a measure of farm liquidity. Total current farm liabilities are subtracted from total current farm assets to find working capital. This measures the ability of the farm to pay off current liabilities.
farm’s profitability and can be calculated by dividing the earnings of the fiscal year by the total assets. 4. Return on equity = 16 percent or higher o Return on equity measures the business’s profitability. This percentage indicates how much profit is generated from each dollar of the shareholder’s equity. 5. Expense-to-revenue ratio = less than 65 percent o If the operation can’t achieve an expense-to-revenue ratio of less than 65 percent, then the producer must reevaluate current farming practices. Efficiency will be key in reducing this ratio.
2. Owner’s equity = 50 percent or more o Owner’s equity is the legal entity of the business. If the percentage drops below 50 percent, the bank will be the majority stakeholder in the farm and will have more impact on business decisions.
6. Family withdrawal = less than 10 percent o The family withdrawal as a percent of revenue should be less than 10 percent. If records indicate the withdrawal is greater than 10 percent, the operation must re-evaluate how many individuals are making a living from the farm’s income.
3. Return on assets = 6 percent or greater o Return on assets is a measure of the
Producers are advised to routinely calculate these
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Producers are tasked with an uncountable number of responsibilities in an agricultural business. Wells described farmers as having five critical tasks: “You are a plant and production manager, a financial manager, marketing manager, risk manager and a human resource manager.” Because few producers can be successful with all five tasks, Wells encourages producers to take advantage of consultants and advisers. A resourceful producer who accepts advice from key consultants and advisers can work toward a “bulletproof” balance sheet for a successful, progressive dairy operation. PD Sara Kitchen is a Penn State student and a freelance writer based in State College, Pennsylvania.
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What differentiates pure play chocolate cafés from the common garden variety chocolate cafés? Nitin Chordia, the only certified chocolate taster in India, outlines the strengths and weaknesses of different kinds of cafés and the way forward for each of them
T
o begin with, I shall classify chocolate cafés in India into three formats for the purpose of better understanding for chocolate brands looking to enter/ expand in the Indian marketplace. A ‘pure play’ chocolate café, which is owned by a chocolate brand and offers mostly chocolate-centric items on the menu, a chocolate café, which is not owned by a chocolate brand and offers more than just a chocolate-centric menu, and lastly a regular café (also called as a coffee shop), which has a few chocolate related items on the menu but focuses mainly on short eats and coffee. Chocolate cafés and regular cafés use industrial chocolates, which help them to keep costs low. A pure play chocolate café would use fine chocolates in its offering
Vol.10 Issue 07 MAY 2015
CHOCOLATE CAFE
The art
of running Chocolate Cafés
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to its consumers, and hence tend to be on the pricier side in comparison. At a pure play chocolate café a consumer is usually seen spending more time engaging with the brand compared to the other two listed formats. A pure play chocolate café focuses on promoting their own brand of chocolates in their menu and enables the chocolate brand to engage with their existing and potential customers. It gives an opportunity to showcase the best that can be done with their chocolates on an ongoing basis. The Godiva chocolate café at Harrods in London, Galler chocolate café in Abu Dhabi, Butlers chocolate café in Karachi, Meiji’s 100% chocolate café in Tokyo, Max Brenner chocolate bar café in Singapore, Lindt chocolate café in Australia and the Shockolat in Milan are all standing examples of pure play chocolate cafés and of brands extending their products and services with an aim to keep the brand always “reminded” in consumers’ mind. A pure play chocolate café offers items on the menu with delicate flavours using cutting-edge recipes and fine chocolates to achieve the desired experience. Typical categories of items on the menu include patisserie, bakery, hot chocolate, ice creams, milk shakes, selection of their signature chocolates and a variety of specialised desserts. Consumers globally visit a pure play chocolate café to experience and discover what the Chocolate brand has been
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innovating with, immerse themselves in chocolate treats to take a break from the usual. While you would find regular cafés in every street corner, a pure play chocolate café would typically be harder to find and would occupy only prominent retail real estate in premium/ central locations. Higher rentals are usually justified because the average price of the menu items are higher and it serves as a destination for chocolate lovers unlike a usual café where the idea is to enjoy a cup of coffee before getting along with your business and work. Moreover, a pure play chocolate café is treated as a marketing investment and an extension to the brand engagement activity in order to build consumer relationships directly. In contrast, a chocolate café or even a traditional café really only seizes the opportunity to cater to the chocolate loving masses and intends to make money by operating each café and expanding the business rather than using it as
CHOCOLATE CAFE
a tool for future gains. Looking at the current scenario in India, we already have a few pure play chocolate café businesses with multiple stores. Chokola, with multiple branches in NCR, Bliss, with multiple branches in Banglore, and Ecstacy in Chennai can be named as pure play chocolate cafés. The similarity among all the three is that they aim at improving their brand reach, ensure direct their home city yet. The reasons for not being able to venture out of their city are many. High cost of retail real estate, lack of availability of qualified manpower, lack of appropriate and feasible locations, high input costs, etc, can be attributed to the lack of expansion. But the most important reason is the lack of basic consumer education about fine chocolates., The Chocolate Room and The Chocolate Heaven are examples of chocolate café chains in India (which work on the franchise model) and operate in multiple cities. They will always have to rely on low/competing prices to differentiate and sustain against the regular cafés since their offering is standardised and their business model is not flexible towards change. The huge amount of effort it takes to change a single recipe or equation at the central kitchen and with all franchises when processes are in place, is well known. One cannot expect to experience innovation and indulge in a new chocolate experience on each subsequent visit to a non-chocolate brand owned chocolate café. Menu fatigue hits the Indian consumer more easily than
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western consumers and hence this model has a long-term disadvantage. Neither are they able to take advantage of scale (like traditional cafés) nor their operating profits justify additional investments (chocolate ingredients amount to high input costs). Further, chocolate cafés run a constant risk of being seen as an equivalent to traditional cafés since there is very little differentiation and they find “One cannot expect to experience innovation and indulge in a new chocolate experience on each subsequent visit to a non-chocolate brand owned chocolate café” consumer engagement and promote usage of their chocolates via these cafés. All of these above businesses do not sell their chocolates via any other physical retail channel. However, we must observe that each of these pure play chocolate cafés listed above do not make their chocolates from bean to bar, which is a missed opportunity. Going bean to bar is the way to differentiate and keep costs low. Currently, they have very less leverage and a clearly defined/limited margin set unlike a chocolate café or a traditional café where only high margin items find their way into the menu since input costs are low. We must also note that their current cost/margin structure has not enabled them to venture out successfully
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outside themselves always playing in a grey area where a true chocolate lover does not see a reason to repeat his visit and a café goer does not find this a convenient location for a pick-and-go opportunity and/or a business meet. While a traditional café business offers handsome operating margins/profits due to low input costs, a central kitchen often becomes essential to sustain the expansion that is required. Most items in the menu of a traditional café have very low input costs and serve the needs of an average pick-andgo consumer. In case of a pure play chocolate café owned by a chocolate brand and making chocolate from bean to bar, the margins would enable them to offer constant innovation and keep “If a pure play chocolate café does not make chocolates from bean to bar, they run the risk of running against a wall due to lack of margins and dependence on imports/ imported coverture chocolates” the engagement / excitement alive
CHOCOLATE CAFE
sustainably. In case of regular cafés, the purpose or intention of visiting varies from usiness meeting points to spending time working and with friends just “hanging out”. In the case of a pure play chocolate café, the overall experience at the café is the driver. While a chocolate café seems to be deprived of all the benefits of the other two formats, they are constantly in the run to compete with the cafés but position themselves as pure play chocolate cafés; a battle that will victimise this format sooner rather than later. A few things need to be kept in mind for a chocolate brand entering the Indian market and evaluating investing in a chocolate café. As part of their entry/ establishment strategy to showcase the brand and demonstrate the possibilities of innovation using their chocolates, they need to remember a few home truths: • Retail real estate is among the most expensive in the world. • Chocolate consumption naturally reduces during hotter seasons. Being a tropical country, most of India is hot during most of the year. • Indian cocoa beans have not yet proven themselves worthy of being used in fine flavor chocolates and hence a chocolate café wouldhave to rely on using imported cocoa powder, cocoa butter and coverture for their fine flavor offering, or importing it themselves (driving theirinput costs northward).
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• Import duties for cocoa and chocolates are among the highest in the world in India.
prime retail locations in the main metro cities like NCR, umbai, Bangalore,
• Indian consumers are underexposed to fine chocolates and not yet able to appreciate the fine flavours in chocolates. • Indian consumers are increasingly becoming health/calorie conscious and most of the items on the menu with chocolates are going to reflect a high calorie intake, which is a cause of concern. • Constant innovation with the menu to reduce menu fatigue is an important consideration and investment that should be accounted for. For a chocolate brand looking to enter the exciting and fast growing Indian market and stay on to reap the benefits in the long term, the primary goal would be to first establish a reputation for the brand. A bean to bar chocolatier investing in a pure play chocolate café with a live kitchen at
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Pune and Ahmadabad, to start with, would have an opportunity to engage and establish/build elationships directly with consumers and to educate consumers. The menu offering should meticulously focus on using chocolates innovatively and be priced aggressively, targeting the upwardly mobile consumer, to encourage
CHOCOLATE CAFE
engagement. The live kitchen would enable innovation and ensure that the consumer has a reason to come back every week for new chocolate treats! This image and reputation building would complement their larger marketing efforts in India and help in reaching the brand via other sales channels to consumers. The café by itself with these basics, would promise reasonable profitability and a very attractive ROI to justify this investment as a complement to their larger marketing effort. If a pure play chocolate café does not make chocolates from bean to bar, they run the risk of running against a wall due to lack of margins and dependence on imports/imported coverture chocolates. Securing a low-cost source of supply is the key to making this format work. The question is: Will chocolate companies globally use these above inputs or take a cue and adopt a “Make in India” strategy for their India entry?
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NEWS
Food processing only sector
which can generate V Gokuldas
huge employment opportunity
HRS Process Systems Ltd., (HRS) part of UK based HRS Group, is one of the leading heat transfer specialist that operates at the forefront of thermal processing technology. Established in 2003, with headquarters in Pune, HRS has marketing offices spread across major metro cities of India along with the group companies in UK, Spain, USA, Malaysia, Australia and New Zealand. HRS offers effective heat transfer solutions for an extensive range of processing applications across a spectrum of industry sectors like Food & Beverage, Nutraceuticals, Dairy, Pharmaceuticals, Chemical, Oil & Fats, Fertilizer, Cement, Steel, Power, Agro Chemical, OEM (Original Equipment Manufacturers), Paint, Paper & Pulp, Textile, Automotive, Sugar, Breweries and Distilleries among others. HRS is ISO 9001:2008 certified along with ASME ‘U’(The American Society of Mechanical Engineers), NBBI (The National Board of Boiler & Pressure Vessel Inspectors), HTRI (Heat Transfer Research, Inc.) and NSIC-CRISIL accreditations. In a candid chat with V. Gokuldas MD, HRS Process Systems Limited we came to know about some of the latest information about the company and his views about the food processing industry of the country and its potential.
G
overnment of Indian has kept Food processing Sector in “Make in India’ plan, your comments. India is the world’s second largest producer of food with a clear potential of being the biggest. The food processing industry is one of the largest industries in India contributing to 9-10% of GDP through the agricultural and manufacturing sectors. Sectors such as agriculture, horticulture, dairy, fruit pulp, vegetables and beverage processing,
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bakery and confectionery, meat, additives and nutraceuticals are some the key contributors to food industry. The Indian food Industry stood around US $ 39 billion in 2013 and is expected grow at rate of 10 % to touch US $ 64 Billion by 2018. At the same time it must be noted that the level of food processing in the country stood at 6 per cent, as against 60 to 70 per cent in developed countries. Food processing sector has great potential in India, since a very small percentage of the fruit and vegetable produce find
their way into processing sector. Right combination of technology and marketing will enable companies to grow in this sector. The sector can achieve faster growth with more investments and better technology and Make in India seems to offer the right platform to the food processing sector. What Potential do you see for the growth of this sector as a whole which includes grains, fruits & veggies and modern food products?
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The food sector has witnessing a marked change in consumption patterns, both in urban and rural areas as well as in terms of demographics. Changing lifestyles are driving growth and demand for newer food and beverage categories as well as more processed foods that offer convenience with a longer shelf life. Rising income levels and a growing middle class are the main factors for processed food demand. There is an awareness and concern for wellness and health foods. Consumption in India is slowly driving towards packaged and ready-to-eat foods. There is a need of enhancing technology and machinery which not only retains the naturalness but also gives a longer shelf life to the processed products. Companies like HRS have been at the forefront of innovation in food processing technology enabling food and beverage companies to substantially increase both quality output and productivity. We have introduced revolutionary products and solutions for a range of food products fruit pulps, beverages, diced fruits, readyto-eat foods, range of dairy products, nutraceuticals, infant food substitutes and probiotic supplements. Food Processing is directly connected with the farm produce, do you think this can be a game changer for farming
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communities if done systematically in rural areas? India is an agrarian economy and enhancement of agriculture / farming output will not only benefit the food processing sector, but will also enhance economy and opportunities for rural employment. While large farmers can absorb losses relatively easily, it is the small farmers that have to bear the brunt of losses, at times emerging from “wastage” of agricultural produce. This is where the processed food industry can play a significant role. The farmer is not dependent on one product or produce but can look at various options suitable for farming during the year. Better storage and transportation facility will help reduce wastage. Enhancement in food processing will make the market more competitive thereby giving the farmer a better return on their product / produce. Thus, growth in food processing will be a game changer for farming communities especially in rural areas. Government announcement of setting up of 17 new mega food parks is in the right direction. These parks are expected to attract investment of over Rs 6,000 crore. If media reports have been accurate then basic infrastructure in these food parks will be set within 30 months. In each
NEWS
mega food park, 40-50 food processing units would come up and it would directly get benefited to 5 lakh farmers. Food processing sector can without doubt be a game changer for India’s rural economy but it needs to be supported with better infrastructure in terms of road connectivity, power for cold storage / warehousing and innovative Government financing / credit availability for small farmers as well as micro small and medium enterprises (MSMEs). The “Make In India” focus of the Government should facilitate this in a planned and systematic manner. Do you also think that food processing is the answer to the unemployment among the rural youth? Yes ! Only 2 per cent of total fruits, vegetables and grains produced in the country are processed. This number can be substantially improved. Food processing sector is the only sector which can generate huge employment opportunity in the rural belt with low technology and low investment. Increasing agricultural output would need increased manpower apart from other resources. This will not only help generate employment in rural areas but also provide better remuneration for the day’s work. The food processing industry is also
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one of the largest employment creators, with growth in direct employment in the organised food processing sector expected to grow four fold in the next decade. The food processing plants need to be near source of raw material and hence there is a huge potential for employment for rural youth. How important are the new methods of food processing, expertise and cutting edge technologies for the success of today’s food processing companies? Food processing has undergone drastic change in the last two decades. This has been due to urbanization, changing life style, higher income and preference for quality products. The increase in volume/ demand for processed food products has necessitated development of technology that can deliver quality hygiene products at competitive price. Unlike other processes, processing of food products has to be very delicate, else the natural flavour or taste is lost rendering product useless. Deployment of latest technologies plays a pivotal role in food processing industry. These technologies contribute to increasing production by minimise downtime, increased capacity and efficiency, lower costs and better product quality and shelf-life. The technology also needs to look at the packaging of the products based on requirement, convenience and visibility. Thus, the food processing sector has grown not only in thermal treatment or process technology but also in packaging of products. HRS innovative heat transfer technology incorporating the Ecoflux* corrugate tube heat exchanger, Unicus® scraped surface heat exchanger and HRS Piston pump for various processing applications gives our customers the technology advantage. How has been your journey with fruits segment especially with mangoes in India? India is the largest cultivator of a variety of mangoes. Some of them are primarily used in pulp manufacturing and constitutes as key ingredient for many beverages. The country also dominates
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the world market for mango pulp and possesses close to 67% share of world exports. The manifold growth in the packaged mango drinks segment has propelled fast paced growth in the proverbial mangoprocessing basin of India – the common borders of three states, Andhra Pradesh, Tamil Nadu and Karnataka – primarily the Krishnagiri -Chittoor belt. Other areas in Maharashtra and Gujarat also process special mango variety. Fruit beverage companies like Parle, Pepsi, Coca Cola and the likes rely on pulp processed from this mango belt of India. There are numerous mango processing units in this belt which work during the season only. The mango season is between 45 to 60 days and in that time all the produce has to be processed and packed for consumption throughout the year ! Thus reliability of plant operation has to be very high. HRS energy efficient heat exchangers incorporated into preheaters, pasteurisers, sterilizers and evaporation systems enable Customers to have non-stop production during the mango season. Our advanced evaporation systems ensure that the mango pulp is reduced in volume by reducing the water content, our aseptic Monoblock sterilizer with filler process and pack this pulp in a complete hygienic environment. This in turn means that the fruit processing companies are able to cut down significantly on packaging, transportation & storage costs as more quantity of pulp can be filled in same size of containers. Our customers have appreciated our systems and also service support. HRS has installed Evaporation plants for Mango pulp processing at renowned processors like Rasaa Foods, Roshan Fruits, Sreedev Agro, Sree Sannidhi foods, Monoblock Sterilisers at Jadli Foods, Amudha Aseptic, Sree Sannidhi, Foods & Inns, Leon Foods, Sri Varsha Foods, amongst others. Many of these companies in turn either export their produce or supply to large food and
NEWS
beverage companies. We are seeing a substantial increase in demand for our pulp processing solutions from the mango sector. Our HRS Paradice* dice pasteuriser, UHT system, Nutraceuticals processing lines are some of the key solutions to the market giving our customers the particular advantage for meeting the demand for superior quality foods. Please brief us about HRS-Paradicetechnology and your plans to promote the same in India? HRS ParaDice* is a unique offering from HRS Process Systems, which is capable of processing fruit dices / vegetable dices / ready-to-eat food without shearing them. The product is pumped using our unique HRS Hygienic Piston Pump which pumps products without breakage and are heated and cooled in the highly efficient ECOFLUX* Tubular Heat Exchangers for rapid, homogeneous and efficient heat transfer. HRS ParaDice* ensures quality product without loss of color, flavour or aroma. Product integrity and shape is maintained. These particulate foods are pasteurized for hot fill or aseptically processed for filling in aseptic containers. This innovative processing technology opens up a huge potential of applications for diced fruits and vegetables, ready-toeat foods where the natural taste, texture and shape is of huge priority.
For Updated News Everyday logon to
www.agronfoodprocessing.com
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Vol.10 Issue 07 MAY 2015
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MEGA OPPORTUNITY FOR
FOOD PROCESSING INDUSTRY
South India's Largest Exhibition on Food Processing, Packaging and Technology.
11 Edition th
28th - 30th August, 2015
Chennai Trade Centre, Chennai, India.
Foodpro 2015 - Highlights l Three-day Exhibition (Processing, Packaging &
Technology, Fish & Poultry & Agri Processing).
l 200 Exhibitors, 5000+ Business Visitors, 25000+
Trade Visitors.
l International Participation
Exhibitor Profile
l One-day Industry Conference on Food
Processing and Technology l One-day session on Food Safety Act l B2B Meetings, Product Launches, etc
l l l l l l
Food Processing Technology & Machinery Refrigeration & Cold Chain System Processed & Packaged Foods, Ready to Eat Food, Snack Food Bakery Equipment & Machinery, Technology, Ingredients, Fragrances & Flavours Retailing & Vending System, Hotel & Kitchen Equipments, Hospitality Products & Equipments Packaging Machinery & Technology, Bar Coding, Inks & Materials
* ASSOCIATE SPONSORS
CO-SPONSOR
REGISTRATION SPONSORS
This list is illustrative
CORPORATE SPONSOR
For more details of Food Pro please contact Confederation of Indian Industry (CII) Business Fairs Division. | Prof. C K Prahalad Center No.98/1, Velachery Main Road, Guindy, Chennai - 600 032, INDIA Tel: +91-44-42444555 | Fax: +91-44-42444510
Website: www.foodpro.in
Vol.10 Issue 07 MAY 2015
|
Mobile: +91-97899 81146
|
Email: foodpro@cii.in
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CODING
Breaking the Code: How improving the coding process can optimizebaked goods manufacturing productivity
C
onsumers, business partners and the regulatory authorities demand ever more accurate on-pack coding and information.Improved legibility, more variable data, better chosen print locations, faster production lines and more problematic packaging formats are all putting coding under the microscope. Coding errors affect product quality and drive unacceptable costs throughout the enterprise due to scrap, rework, regulatory fines, damage to the brand reputation and more.In order to effectively “repair” the coding process, we must first identify the root cause. According to a Videojet survey, up to 70 percent of coding errors are caused by operator error, with approximately half of these caused by mistakes in code entry and job selection. In addition, it was discovered that coding errors are not the deviation, but the norm. Nearly half of manufacturers
Vol.10 Issue 07 MAY 2015
participating in the survey revealed that coding errors occur at least weekly, while 25 percent of respondents reported them as a daily occurrence. The unfortunate fact is that coding errors have become commonplace, but they do not have to be.
While manufacturers would typically put additional checks in place during packaging to address coding errors, this does not necessarily handle the issue effectively or efficiently. Working with
an experienced printing partner with extensive printer capabilities and system design know-how, manufacturers can create and implement a coding process with built-in code assurance elements that limit the potential for user error. Simplifying the process of message selection and entry through the use of automation and software tools can greatly prevent coding errors, increasing productivity, reducing waste, and minimizing operational costs and risk. Automated Code Assurance “Poka-yoke” is a Japanese term that has its origins in the Toyota Production System and can be translated as “mistakeproofing”. When applied to manufacturing operations, a poka-yoke is any measure put into place during the manufacturing process designed to prevent human errors before they occur. The right printing partner can help a manufacturer of baked
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goods design a comprehensive system that implements various poka-yoke principles through advances in printing technology, virtually eliminating coding and marking errors. Intelligent User Interface Using an operator interface designed with existing code assurance tools can simplify message selection, restrict operator input and automate messages. For example, the printer’s user interface can include features such as separate user authorization for code creation and job selection, restricted and pre-approved coding parameters, and job storage under intuitive names that speak directly to the product being coded. In addition, the user-friendly interface allows calendar selection for dates to eliminate erroneous formats due to regional or product differences, and link product dates that automatically use the “Sell By” date to determine the “Use By” date. Other simplified options can include, setting calendar rules to prevent the selection of certain
CODING
dates like weekends or holidays, data selection drop down menus that eliminate incorrect key strokes, confirmation of data to allow a print job to proceed, and confirmation of data prior to every job change to ensure the correct job has been selected. These design options should be an integral part of new generation thermal transfer printers, as well as ink jet coders, large character marking, laser marking systems and thermal ink jet product lines. Software and Network Message Control Implementing windows-based software can provide additional support, removingcode design from the production floor and eliminating the need to load individual messages onto each printer interface. This PC-based message creation and management tool serves to remove human error from the coding equation. In addition, network controls can further reduce operator input, pulling from authoritative data sources, making sure the right codes go to the right printers. These network-based coding messages can be distributed to multiple coding and labeling devices across a facility, or even several facilities. Using automated systems to simplify message creation and management greatly reduces the potential for human error. As part of a broader quality assurance system, these controls couldbe synched with existing Supervisory Control and Data Acquisition (SCADA), factory networks, Manufacturing Execution System (MES) and Enterprise Resource Planning (ERP) systems.
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Open data base connectivity (ODBC) allows coding messages to be created and stored in SQL, Access, Excel and generic databases. This comprehensive connectivity will allow job information access from any enabled coding or labeling system, ensuring efficiency, as well as protection against operator error. Regulatory Concerns Various regulations require bakeries around the world to include expiration and manufacturing information on their products.In addition to the costs associated with rework and scrap, coding mistakes that hit store shelves can result in significant costs for failure to comply with food safety regulations such as fines and even product recall.
According to the Videojet survey of manufacturers, coding errors on product packaging take place on a regular basis, resulting in lost; time, resources and brand integrity. While some might consider this the cost of doing business, it no longer has to be. The primary cause of most coding mishaps is human error. By working with an experienced printing partner to design a coding process with built-in code assurance elements (also known as poka-yoke principles), manufacturers can eliminate errors before the codeis even applied to the product. Utilizing the latest in manufacturing automation and software tools to simplify the process of message selection can prevent coding errors, increasing productivity, reducing waste, and minimizing operational costs. Every application is different and has its unique set of requirements. It is therefore important to work closely with the coding equipment manufacturer for guidance on the best solution for your line.
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NEWS GROUP
Innovation is life
MOISTURE is the hidden enemy of Dry Fruit Industry
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Vol.10 Issue 07 MAY 2015
RB/BA/1510HVCA4
Service
ECODRY
artorius ProControl@Enterprise (SPC@Enterprise) is already well established as one of the most reliable software solutions for process control and quality assurance in the ready-packaged industries. With its full range of inline and sample checks, it provides users with a 360-degree view of their packaging line, seamlessly integrating into all common computer and office structures. SPC@Enterprise takes information from across the production line, and provides detailed analysis to improve operational excellence. In order to make this process even more efficient, the software has been re-designed to support a complete range of mobile devices as input and monitoring terminals. This update allows the instantaneous transfer of notifications regarding aspects such as process deviations or disturbances. With this new level of mobility users can react much faster to drops in production efficiency, reducing the costly waste of resources and increasing productivity. Designed for easy integration into almost any production line, SPC@Enterprise is built for compatibility with the latest generation of Microsoft SQL databases and operating systems. Thanks to this, a whole range of sensors and controllers from any manufacturer can be monitored via the software, or optionally process data can be accessed via the cloud. For food manufacturers the guarantee of compliance with IFS, BRC and ISO22000 has never been easier as SPC@Enterprise allows users to monitor their production processes from any place at any time. Many production lines and centralized IT systems are built on Windows technology. To ensure compatibility with these, and promote quick integration, SPC@Enterprise will operate on any tablet running Windows 8/8.1. To futureproof its use in all operational environments, version 3 of SPC@Enterprise will work alongside Windows 10.1/2 Sartorius Intec Sartorius Intec is part of the Measuring Components Business Unit of Minebea which is the world’s leading comprehensive manufacturer of high precision ball bearings and components also a provider of innovative and high quality precision technologies. Furthermore Sartorius Intec is a global market leader for industrial measurement technologies in the fields of measuring and inspecting, offering a comprehensive portfolio of products, solutions and services across the manufacturing processes of customers. This extensive portfolio provides solutions from goods-in to goods-out including platform scales, process vessel and silo scales, checkweighers and foreign body detection equipment as well as process control and recipe software.
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NEWS
Government should promote ICAR tech to detect detergent in milk
E
xpressing concern over adulterated milk in the country, a Parliamentary panel has suggested the government to make efforts to popularise a new technology for detecting the presence of detergent in milk.
and popularise" the new technology "extensively" so that it can be made available to every milk cooperative in the
commercial aionic detergent in 100 ml of pure milk. This qualitative test can be easily performed at milk collection centers. The cost of chemicals per test is about 40 paise. However, cost of test after including disposable plastic tube and tip will be Rs 1.40, the report added.
The government's Indian Council of Agricultural Research (ICAR) has developed a new colour-based test for rapid detection of detergent in milk.
Already, Mother Dairy has agreed to bring the test to market. The new technology is not recommended for household purpose due to involvement of hazardous chemicals.
The technology has already been transferred to Rajasthan Cooperative Dairy Federation, Mother Dairy and Ahmedabad-based Havmore Icecream Ltd. "The Committee is of the view that availability of cheap and easy to use test will help immensely to stop the menace of adulterated milk (especially with detergent etc.) available in the market," the Parliamentary Standing Committee on Agriculture said in its latest report.
country. According to the report, the new testing technology, which has been validated by Mohali-based Punjab Biotechnology Incubator, detects all brands of commercial detergent available in the market.
Hence, the Committee it desires that the government puts efforts to "publicise
The test gives results within 100 seconds and can detect the presence of 20 mg
Haryana-based dairy institute National Dairy Research Institute (NDRI) is regulatory demonstrating and explaining about the new technology to dairy industries, entrepreneurs at largest, as per the panel report. Milk production in India, the world's largest producer and consumer, is in the range of 135-140 million tonnes.
Milk poured on road by Dairy Farmer
S
tating that milk should not be procured from a person who acted against the Kolankondai Milk Producers Cooperative Society in Mallasumudram Union, dairy farmers’ poured milk on road and staged protest.
the past 10 years, was removed as a member.
The society has 250 members in which 55 farmers supply about 450 litre of milk everyday to the society. Farmers were dissatisfied with Kandasamy, who was the president and a member. Hence, farmers elected a new president and the society also started to function
Farmers poured milk on the road and raised slogans that they would not supply milk to the society, if milk was procured from K andasamy.
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It is said that he tried to supply milk to the society recently that was opposed by other members. Also, farmers allege that officials were in favour of Kandasamy.
from a new building. Kandasamy, who failed to supply milk to the society for
Also, they said that officials are responsible for the loss they incur due to pouring of milk.
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NEWS
Mother Dairy analyzing to go for North-East's Rs 500 crore Dairy Whitener Market
M
and distribution channel and dealers for promotion and sales of 'Dailycious' brand in the region.
other Dairy Fruits and Vegetables Private Limited (MDFVPL), is planning to take on the Northeast's 500 crore dairy whitener market in a big way. The company has launched its dairy whitener brand "Dailycious' in the region and claimed it had done at least two years research in Northeast before coming out with the product. The dairy whitener market has been registering around 15 per cent year-onyear growth in value in India as well as in Northeast. "The dairy whitener market in Northeast is huge. Since we decided to enter this market, we had researched for two years in the region, taken inputs from customers across various segments, identified the region specific needs and demands and then came out with this brand. Besides Northeast, our focus states for Dailycious are eastern India states and
Around 22,000 stores across the region sell Dhara'brand and the company targets to make available 'Dailycious' brand in all those 22,000 stores soon.The company has kept a target of Rs 60-70 crore business in first year of launch in Northeast and Rs 150 crore nationwide. Kerala," said Subhashis Basu, business head (dairy products) of MDFVPL. He added that the Dailycious brand had been developed keeping in mind the needs and preferences of both commercial as well as domestic market of Northeast. Presently, two popular dairy whitener brands - Amulya from Amul and Everyday from Nestle, are the dominant players in Northeast's market. Mother Dairy is depending heavily on its Dhara oil (Dhara is also a Mother Dairy brand) marketing
The Dailycious brand will soon be launched in other parts of the country as well. The products are being manufactured at the company's newly set up plant in Etawah in Uttar Pradesh. "I am confident that the product will meet and exceed the consumer expectations on key product attributes such as color, taste, miscibility and cuppage," added Basu. Mother Dairy is a whole owned subsidiary of National Dairy Development Board (NDDB).
Amul Dairy polls to be held for 11 posts on May 12
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lections for 11 posts of board of directors of the Kheda District Cooperative Milk Producers Union Ltd, popularly known as Amul Dairy, will be held on May 12.
Curiously, at Matar, BJP-backed candidate and chairman of Nadiad's APMC Vipul Patel too won the election uncontested as Congress candidate Dhiru Chavda pulled out.
Anand-based Amul Dairy dairy co-operative in the is in control of Congress, successfully made inroads milk unions of the state.
is the last state which as BJP has in all other
For the first time in the history of Amul Dairy, elections are being held based on the block system. Each taluka that falls under the jurisdiction of the dairy union has been converted into a block.
After the last day of withdrawal of forms, 28 candidates remain in fray for the polls. Two candidates including Amul Dairy's sitting chairman and Thasra's Congress MLA Ramsinh Parmar were declared winners uncontested as no other candidate remained in fray against Parmar.
Traditionally, representatives of milk producers (farmers) from each villagelevel milk societies (mandlis) used to cast their vote for 13 candidates of a panel.
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Now, the voters have been divided into blocks. Village-level societies will elect
their representative to the dairy's board from their respective blocks. Elections were supposed to be held for 12 board members elected block-wise and one elected on individual seat. With two candidates already winning the polls uncontested, now 28 candidates will be contesting for the remaining 11 seats. At most of these blocks, there is a direct fight between Congress and BJP candidates. At Borsad, dairy's sitting vice-chairman and Congress MLA Rajendrasinh Parmar is in direct contest against Soma Padhiar. While in Balasinor, Congress MLA Mansinh Chauhan is contesting against BJP's former MLA Rajesh Pathak.
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Complex regulatory regime impacting the development of Food Processing Sector
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food processing and packaging machinery have been reduced to 6 per cent from 10 per cent. The food processing units have also been allowed 100 per cent Income Tax exemption on profits for the first five years of operation and after that, 25 per cent exemption for the next five years, she said.
omplex regulatory regime and lack of access to affordable credit are impacting the development of food processing sector in spite of various fiscal incentives given by the government, Lok Sabha was informed. Union Minister Harsimrat Kaur Badal said the overall level of food processing in the country was estimated to be less than 10 per cent compared to "very high" levels in certain developed and developing nations. She said lack of efficient supply chain infrastructure, inadequate processing capacity, complex regulatory regime and lack of access to affordable credit are "some important causes of slow
development of food processing sector in the country". During Question Hour, the Food Processing Industries Minister said that various fiscal incentives were being provided for the development of the sector, like reduction of excise duty on
Under the National Mission on Food Processing (NMFP), financial assistance is provided to entrepreneurs to help them increase food processing capacity. "NMFP has been delinked from central government support from current financial year excepting the union territories," she said.
Maggi Magical Masala row: Nestle to appeal against Madras High Court order which favors ITC Mohan of law firm Mohan Associates. The order said although ITC's instant noodle was marketed under the Sunfeast Yippee brand, it was popularly known as Magic Masala and ITC not only used the term first, but showed it had won market share against its rival with the product.
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estle India is planning to appeal against a Madras High Court interim order over its product, 'Maggi Magical Masala', in a case filed by ITC. The latter said the Maggi variant was launched on the back of the success of its 'Yippee! Magic Masala', thereby infringing on its intellectual property rights. The respondent has to withdraw the Maggi Magical Masala variant even if it plans to file an appeal, said ITC counsel Arun C
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When the word is only descriptive of the character of the goods, no protection can be claimed for use of such word, but if the word is known for its distinctiveness (and) secondary meaning, such word is entitled to get protection," the order said. An ITC spokesperson declined to comment on the issue. A spokesperson of Nestle India said: "We have seen the interim order and are preparing to file an appeal." "The respondent cannot sell this variant till the time they win after making the appeal. The judgment is significant in the sense that an IPR infringement can be enforced even against a market leader,"
Mohan said. ITC had filed the suit against Nestle in 2013 when the latter launched Maggi Magical Masala. Having entered the instant noodle segment in 2010, ITC has been steadily gaining market share. As per market estimates, Nestle has around 72% volume share in instant noodles against ITC's 18%. This is put at 74% and 17% by value, respectively. These figures could not be independently confirmed with Nestle and ITC. While Maggi Magical Masala may not be the largest-selling variant, if it is withdrawn, ITC would have some room to gain additional market share, according to a senior executive with a leading food and grocery retail chain. It's estimated that ITC's instant noodle market share has been growing at three times the market rate.
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McDonald’s gives Indian customers option to choose their own Burger buns
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cDonald's is giving its customers in India an option to choose their own burger buns, in a global first for the world's largest restaurant chain, as it looks to expand its customer base with healthier options and revive stagnating sales.
from its new global programme of 'Create your own taste' or 'Build your Burger' where consumers can choose sauces, fillings and a bun-less burger option. While McDonalds offers varieties of buns globally, each one is restricted for a specific burger.
Customers across western and southern India can now choose from two buns, whatever burger they order. The burgers with the healthier Focaccia buns, which McDonald's introduced over the weekend, will cost an additional Rs 15 over the regular ones.
McDonalds India has nearly 370 restaurants and plans to open another 175250 in the next 3-5 years, by investing about Rs 750 crore.
These premium buns provide tremendous taste and flavor for the consumers. With olive oil as one of the ingredient, it is also healthier and has less sugar than existing buns," said Amit Jatia, vice-chairman at Westlife Development Ltd, operator of over 200 McDonald's and 30 McCafe outlets across western and southern India. Some experts and analysts feel the move will help McDonald's woo healthconscious young customers who currently prefer restaurants that serve healthierfood such as Subway, at a time when leading chains have been reporting negative or singledigit growth for at least six quarters.
"For a consumer, a burger is considered junk food and McDonald's needs to innovate its health quotient," said Abneesh Roy, associate director at Edelweiss Securities. "Also, a premium offering will improve margins at a time when sales are under pressure," he said. For the past four years, McDonald's in India has been building its menu towards the healthier sside. It has rolled out an allgrilled product breakfast option, added egg burgers and introduced ice-creams with less than 3% fat. It also cut almost 50-60 calories on an average from all burgers, about 40% fat content in sauces and roughly 20% sodium in fries. The chain's latest offering takes a cue
While there is a common supply chain and product development team for McDonald's outlets across the country, the two burger option will be restricted to west and southern India for the time being. The eating-out market in the country is estimated to be $94 billion, or about Rs 5,85,000 crore, but only 2% of it is organised with national and international food retail brands. With major chains such as McDonald's, Yum's KFC and Pizza Hut and Jubilant FoodWorks, which operates Domino's Pizza and Dunkin' Donuts, all struggling to grow amid an economic slowdown, the industry is under pressure to increase volumes and profitability.
Kraft's Macaroni and Cheese to get a healthy boost
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raft Foods Group will remove artificial colors and preservatives from its flagship macaroni and cheese product beginning in early 2016. The changes include replacing Yellow No. 5 and Yellow No. 6 dyes with seasonings like paprika, annatto, and turmeric, which themselves have health benefits. Kraft's announcement comes after three years of research, tweaking, and consumer tests, which showed that consumers are looking for simpler foods with fewer chemicals that they can feel good about serving to their families and
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eating themselves — as long as Kraft can maintain the product's original flavor. Heinz had already started making organic ketchup, and Kraft had removed artificial preservatives from some Kraft Singles and announced a recipe tweak to Capri Sun. How far will Kraft and Heinz take these overhauls to meet the demands of consumers looking for healthier, simpler prepackaged and processed foods? Or will the combined company, once it merges, stick to what it arguably knows best and give some consumers what they really crave?
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Coconut production in the country drops 10% production in major coconut growing states showed a 10% fall in 2014-15 over the previous year.
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he prices of coconut and allied products may turn bullish as a survey conducted by the Coconut Development Board (CDB) indicated a drop in output in three major coconut growing states. Overall production in the country based on the estimation of
The CDB survey on production registered a decline in production in Andhra Pradesh, Kerala and Karnataka while the Tamil Nadu, Odisha, West Bengal and Maharashtra recorded an increase. The four southern states together comprise around 90% of the coconut production in the country In Kerala, the largest coconut grower in the country, production fell by 17.48% to 4886 million nuts because of inadequate rain, pest and diseases. Major drop in production was observed in Idukki, Kottayam and Kollam districts while
Alappuzha showed a significant rise in output, according to an official statement of CDB. The second biggest producer Tamil Nadu reported 3.9 % rise at 4850 million nuts with increase in crop in Tirupur, Tanjavur and Kanyakumari districts and a decline in Krishnagiri and Tirunelveli districts. Karnataka recorded 4.87% fall in production at 4126 million nuts with major coconut growing regions of Tumkur, Hassan, Udupi and Dakshina Kannada facing a shortage. The highest reduction in yield was observed in Andhra Pradesh with state suffering from two cyclonic storms in the last two years. All the four major coconut growing areas of east and west Godavari ,Srikakulam and Vizag registered a fall in production.
Foodgrain stocks with FCI decline to lowest in 5 years
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he foodgrain stocks held with Food Corporation of India (FCI) have fallen to the lowest level in last five years, mainly because of decline in grain procurement and the corporation selling a chunk of wheat stocks in the open market. As per the latest data, FCI has grain stocks of 41.03 million tonne consisting of rice (23.7 mt) and wheat (17.2 mt) on April 1 against the prescribed buffer norms of 21.04 million tonne. However, the grain stocks have fallen by more than 45% from an all-time high of 59.75 million tonne held by FCI two years back. In the last two years, FCI has sold more than 10 million tonne of wheat in the open market while the wheat procurement has dropped from 38.1 million tonne to 28 million tonne. Similarly, the rice purchase by FCI and state government-owned agencies have declined to 31.8 million
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tonne from 35 million tonne in the last two years. “We have reduced grain stock substantially yet it is far above buffer norms prescribed by the government,” a food ministry official said. FCI has more than 17.2 million tonne of wheat at present against the buffer norm of 7.4 million tonne. In a bid to liquidate excess stocks, for the first time this year, the government has already allowed FCI to continue with Open Market Sale Scheme (OMSS) beyond March 31 in non-procuring states such as Odisha. Besides, the government has commenced sale of rice under OMSS for the first time. The high-level committee (HLC) for FCI restructuring chaired by former food minister Shanta Kumar in its report had observed that during the last five years, on an average, “buffer stocks with FCI have been more than double the buffer norms costing the nation thousands of crores
of rupees loss without any worthwhile purpose being served”. HLC had stated that the current system is extremely ad-hoc, slow and costs the nation heavily. “A transparent liquidation policy is need of the hour, which should automatically kick-in when FCI is faced with surplus stocks than buffer norms. Greater flexibility to FCI with business orientation to operate in OMSS and export markets is needed,” the committee had observed. At present, the buffer stock norms are aimed at ensuring grain supply for targeted public distribution system (TPDS), food security during the periods when production declines and stabilising prices during production shortfall through open market sales. The Cabinet Committee on Economic Affairs (CCEA) in January, 2015 had approved hike in norms for the foodgrain stocks held by FCI.
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Agri tourism enhances Farmer incomes in Maharashtra by 33 per cent
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ounded in 2005, Agri Tourism Development Company (ATDC) has moved beyond traditional approaches to tourism by introducing agriculture tourism to villagers in Maharashtra. Since its inception hundreds of farmers have been trained by ATDC and more than 200 farmers have been helped to start and operate agri tourism in their farms. There are currently 113 Agri Tourism Centers (ATC) operated
by local farm entrepreneurs and employees. “Farmers engaged in agri tourism have experienced an income increase of 33 per cent. On an average, agri tourism goods and services are the source of one third of their overall income. These activities in rural communities also lead to a side income for community members who are not partners of agri tourism,” said Pandurang Taware, MD, ATDC, who is widely acknowledged as the father of agri-tourism in India. There have also been significant visitor arrivals in these villages in the last half decade. “Agri tourism goods and services offered by Maharashtra ATCs have attracted nearly 170,000 visitors from 2007 to 2012. The domestic urban areas are the key markets. Tourists from the city of Pune represent a share of 70 per cent of all visitors,” stated Taware. The tourists experience local agricultural
practices (e.g., horticulture, harvesting, bee keeping, dairying), rural way of living and local culture (e.g., music, food, dances, arts and craft). “It is an opportunity for urban Indians to discover their roots through participatory activities with local communities. The programme attracts international visitors with agri tourism packages designed for independent and group travellers alike,” mentioned Taware, pointing out that ATDC has demonstrated that flexible approach of the farmer and little tourism products knowledge can be profitable to low-income farmers groups. It also stems migration of villagers to urban areas as they get additional income opportunities in their local area. The next five years will see ATDC spearheading the movement across India by setting up ATCs in different states.
Keventer to roll out its Dwarf Cavendish Bananas soon
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olkata-based Keventer Agro, which has captured one-third of the city market for bananas, is now gearing up to expand its procurement, processing and marketing reach in nine more eastern Indian cities this year at an investment of 50 crore. And, that’s not all. The 400-crore company – flagship of the Kolkatabased MK Jalan-controlled 2,000-crore Keventer Group – is aiming for a national roll out of popular ‘Dwarf Cavendish’ variety, also referred as Grand Nain (G-9) variety, in a phased manner. “Over the next two years, Keventer Group will invest 200 crore in food business,” saidMayankJalan, Managing Director of Keventer Agro. “Of the total investment, 50 crore will go in establishing the network in nine cities; 68 crore is earmarked for setting up
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milk collection and processing unit near Bhagalpur in Bihar. And, a lot of funds will be geared up towards acquisitions,” he says. Mayank says the group is “in conversation with a few players” for acquisition in the existing areas of the group’s food business – that includes dairy, fresh fruits (banana), fruit pulp (mango pulp), sesame seeds, spices and others. With an aim to clock $2 billion turnover in food business in 10 years, Mayank is clearly betting big on banana. He wants to move fast, and grab a sizable pie of the country’s banana market. India produces close to 17 million tonnes of banana, mostly for internal consumption. The top 10 producing destinations are Tamil Nadu, Gujarat, Maharashtra, Andhra Pradesh, Karnataka, Bihar, Madhya Pradesh, West Bengal,
Assam and Odisha. As a Kolkatabased company Keventer has already established its presence in its home State and is now out to expand to neighbouring Bihar, Assam, Jharkhand and Odisha. The company provides saplings of pest and disease resistant variety to farmers. It takes 11 months to give the first fruit. In the meantime, the company sets up its collection, ripening and processing centres to cater fresh fruits to the local markets. Mayank claims his business is beneficial to both end-consumer and farmer. While the consumers are getting improved quality fruit at market price, the farmer earns higher than market price. “We will be sourcing directly from the farmers. And we will be paying them a higher price than what they get in the mandis,” he says.
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Experts praise FDA role in ensuring Food Safety chief guest while faculty included Dr Mohan Khamgaonkar, Dr Sarita Ugemuge, Dr Abhijeet Deshmukh and food safety expert Prabodh Halde.
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t might have been only recently that the World Health Organisation has started focusing on food safety. Indian authorities, however, were among the first to identify problems as well as form regulations in this regard. In fact, the Food Safety and Standards Authority of India (FSSAI) guidelines inspired similar acts in the United States of America, said experts at a recent CME on food safety organized by city branch of Indian Medical Association (IMA). Deputy commissioner of Food and Drug Administration (FDA) SS Desai was the
"It is predicted that by 2020, India will become the world's kitchen. With diverse agro-climatic conditions, we can produce all kinds of food and are the foremost producers of milk, pulses and tea. With changing times, chemicals have entered food through products like nutraceuticals and health supplements. Considering all this, a need for an all-encompassing law was felt instead of one against adulteration only. So, FSSAI guidelines were made, replacing several older acts," informed Halde, who is also associated with Association of Food Scientists and Technologists.
for conducting the highest number of inspections in the country. Desai gave more detailed information about the way FDA has worked since the act was implemented in 2011. "We have conducted numerous random inspections, sampled products at each stage of processing to identify wrong doers and acted against even the most reputed establishments in Nagpur division. Licenses have been suspended and products have been recalled too. Such stringent action has not happened anywhere else," he said. He also said in three years a lot of improvements have happened as FDA can now take action against offenders rather than only reporting them. "The offenders getting strict punishments has also ensured that the number of offences went down tremendously, " Desai said.
He said the rules were formulated so well that even United State of America (USA) took a leaf out of our book in the act that they adopted in 2012. He also praised the efforts of the state's FDA officials
Certain factors, like, how much pesticides are used in a farm or how a product is grown is out of our control, but we start tracing products as soon as they leave farms," said Desai.
would be difficult to reach places on time. Activities such as collection of samples are affected because of the shortage," said a food safety official. The toll free number of food safety department 1800 425 1125 gets around 40 calls a day. However, the department is not able to respond to even five calls a day. "We don't have the required number of vehicles to reach places for inquiry. The department only has 12 vehicles," the official said. As many as 156 posts are lying vacant in the department. This was reported to PSC almost a year ago. However, there was no positive response on the issue. The food safety department was formed
in 2008 to implement Food Safety and Standards Act 2006. The prevention of food adulteration wing and analytical laboratories under the control of the director of health services were transferred to the control of the commissioner of food safety then. Initially, the department was active with frequent inspection of hotels and food business establishments. Now, in addition to manpower shortage, fund crunch too has affected the operations of the department. "The budget allocation for enforcement activities has been cut short to Rs 2.50 crore in this budget. This is going to affect the functioning of the department," the official said.
Manpower shortage seriously affecting the functioning of Food Safety dept.
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anpower shortage is seriously affecting the functioning of food safety department. The number of food safety officers will shrink to 43 from the current 55 with the retirement of 12 officers in May. The department, which is already crippled by manpower shortage, is to face severe crisis in the coming days. As per norms, each constituency must have a food safety officer. According to sources in the department of food safety, a single food safety officer has to look after more than three constituencies, which is impractical. "We get a call from Aruvikkara while handling an issue in Thiruvananthapuram. In such cases, it
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Paper Boat eyes volume deluge with Railways deal
ndian ethnic drinks maker Hector Beverages, which is backed by Infosys co-founder and former chairman N R Narayana Murthy's fund Catamaran Ventures as well as Sequoia Capital and Footprint Ventures, is looking to retail products on trains. The Gurgaon-based start-up recently completed two years of operations and is now eligible to enter into a commercial contract with Indian Railways for retailing its beverages range. Neeraj Kakkar, founder and chief executive officer, Hector Beverages Pvt Ltd, said Railways requires companies to be operational for two or more years to be able to sell on their network. "The brand has been at least two years old before getting selected to be sold on the Indian Railways network and we have just completed two years. It is a very big opportunity for us, something that can bring huge volumes. We will initiate a discussion with them now," said Kakkar. On the institutional front, while there are no major tie-ups in place, the company is already working with hospital service providers, office canteens, etc to sell its products. "We are still small as compared to other domestic and international
beverage companies. Hence it's too early for getting into exclusive tie-ups. The idea is to take one step at a time and gradually penetrate the market," said Kakkar. While Kakkar didn't share any details in
terms sales from institutional to retail, he said that retail sales continue to be the larger chunk at present. "There are too many institutions like the chains of quick-service restaurants, multiplexes etc, where we are not present yet. These will be explored and added to the network, going forward," he said. The company, which has been largely selling through physical stores as well its, has begun exploring e-commerce platforms like Amazon.in, BigBasket.
com and grofers.com to sell its products. According to Kakkar, online sales have been started as an experiment to understand the market response. "It's very small part of the overall business and that sales will grow along with the sector's growth," he said, adding there is decent traction for Paper Boat products online. The Paper Boat range comprises Aamras, Jaljeera, Jamun Kala Khatta, AamPanna, Kokum, GolgappeKaPani, Chilled Rasam and Ice Tea (ginger lemon and tulsi). "There are new and interesting recipes that have come up and we are working on those for future launches. New beverage varieties will thus get added to the portfolio over a period of time," said Kakkar. The company had recently introduced a new pack size priced at Rs 25 for a 200 ml pack. The price of its 250 ml pack is Rs 30. Paper Boat products are available in key markets across Mumbai, Delhi-NCR, Pune, Hyderabad, Kolkata, Bangalore, Chennai, and Lucknow. The company had recently collaborated with Japanese food giant, Indo Nissin Foods to reach newer geographies, particularly those in Tier II cities and some rural pockets
Coca-Cola to acquire Chinese Beverage firm for $400.5 million
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oca-Cola Co., the world’s largest beverage company, will buy China’s Xiamen Culiangwang Beverage Technology Co. for about $400 million in cash, gaining a line of plantbased protein drinks in a renewed push into the Asian market. Coca-Cola is acquiring the business from China Culiangwang Beverages Holdings Ltd., according to a statement from the Atlanta-based company. Xiamen Culiangwang sells a range of protein drinks, including green bean, red bean and walnut varieties under the China
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Green brand. “China is an important growth market for us and this investment complements our beverage offerings there,” said Petro Kacur, a spokesman for Coca-Cola.
The move marks a return to Chinese deals for Coca-Cola after a failed attempt to buy the country’s biggest domestic juice maker in 2009. Chinese regulators blocked the $2.3 billion purchase, saying it would have hurt competition. The decision raised concerns at the time that China was using anti-monopoly rules to block foreign investment. With Xiamen Culiangwang, Coca-Cola is trying to capitalize on the growth of plant-based protein drinks in China. The business is based in Xiamen, Fujian province.
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Bry-Air launches Adsorption Chillers
Energysmart Cooling using Waste Heat
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ry-Air (Asia), today announced the launched of its Adsorption Chiller (range: 35 to 1180 kW). The Bry-Air Adsorption Chiller is based on an innovative green technology, and is the first of its kind in India, and will be manufactured in India under license from Power Partners, Inc., USA The Bry-Air Adsorption Chiller provides Energysmart Cooling using Waste Heat it is a first ever product being launched in India to tap the abundant low grade waste heat available in process industries and use it for process cooling or airconditioning (HVAC). A lot of low grade process heat (50°C – 100°C) generally goes waste, which now can be used for cooling. This eco-friendly solution also cuts down CO2 emission and reduces energy expenses. “Adsorption chillers use energy from waste heat, with negligible electricity consumption, to provide chilled water for
process cooling and air conditioning, and they do this with “green” refrigerant (water) and desiccant (silica gel). We are excited about the opportunities for that this technology provides,” said Deepak Pahwa, Managing Director, Bry-Air (Asia). The Adsorption Chiller has unbeatable advantages like ultra-low electricity consumption, negligible noise and vibration, life expectancy of more than 20 years, negligible maintenance, etc. It is ideal for process industries like Power Plants, Food and Beverages, Chemical manufacturer, etc. and for Commercial areas like Offices, Building, Hotels, Malls, etc. Partners in Innovation Bry-Air, the leader in dehumidification… worldwide, is a global solution provider for desiccant dehumidification, product drying, gas phase filtration, high temperature waste heat recovery and plastics auxiliaries.
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With over 50 years of experience, Bry-Air has pioneered many new technologies. Bry-Air is one of the flagship companies of the Pahwa Group with two state-of-theart manufacturing facilities in India, fully owned subsidiaries in China, Malaysia, Switzerland and Brazil, and a worldwide sales network. Power Partners, Inc., markets energyefficient, environmentally friendly ECO-MAX adsorption chillers that are manufactured in Athens, GA, USA. Adsorption chiller technology is attractive to hospitals, universities, office complexes, data centers, trigeneration facilities, processing plants, manufacturing plants and government facilities. Power Partners is part of PPI, a groundbreaking manufacturing company whose brands include Power Partners, ECO-MAX, Gap Partners and Change Partners. Learn more at www. powerpartners-usa.com.
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Nestle in advanced talks to divest Frozen Food Unit to expand a French Davigel factory in April 2013, which had sales of €783m in 2012.
ources reveal Nestle has been engaged in advanced level discussions regarding the divestment of its frozen food unit Davigel to Brakes Group, owned by Bain Capital, a buyout fund.
Considered to be one of the world's biggest food companies, Nestle announced in 2014 that it was considering the divestment of its underperforming businesses.
As cited in Reuters, people familiar with the matter said that the two companies are in talks about the prospective sale, and the deal could be signed soon. A second source was quoted as saying that the sale, that is expected to amount to between €200m and €300m ($211-317m), is being handled by Credit Suisse. "Potential buyers for the unit included Brake Brothers, Booker Group and Sodexho, along with private equity firms." In 2014, a Reuters report stated that
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potential buyers for the unit included Brake Brothers, Booker Group and Sodexho, along with private equity firms. Nestle bought Davigel, which was a part of the Buitoni frozen food business, in 1989. The unit supplies frozen and chilled meals and ice-cream to restaurants and hospitals. It also announced an investment of €40m
Following that, the company sold its brands, including PowerBar and Musashi, to US group Post Holdings, its US frozen pasta business to Brynwood Partners, and the bulk of its Jennie Craig business. It also divested a 10% stake in fragrance and flavourmaker Givaudan, and cut down its stake in L'Oréal by selling part of it back to the French cosmetics company.
At 20%, Gujarat got highest share of investments in Food Processing
f the total investments worth over Rs 82,940 crore attracted by food processing sector as of December 2014, Gujarat attracted the highest share at 20 per cent, industry body The Associated Chambers of Commerce and Industry of India (ASSOCHAM) stated. The state accounted for 20 per cent of investments by both public and private food processing sources amounting to over Rs 16,570 crore. What's more, the private sector accounted for over a whopping 97 per cent of the total investment attracted in Gujarat. "Besides, Gujarat also accounted for highest share of 21.5 per cent in the total outstanding investments worth over Rs 76,170 crore attracted by the food processing sector from private sector throughout India," ASSOCHAM stated in its latest report. However, investments attracted by
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Gujarat in food processing sector have marginally dipped by over six per cent i.e. from a level of about Rs 17,930 crore as of December 2012 it has dipped down to about Rs 16,570 crore as of December 2014, highlighted the analysis carried out by the ASSOCHAM Economic Research Bureau (AERB). "Private sector accounted for over a staggering 97 per cent in the total outstanding investments attracted by the food processing sector in Gujarat and nationally the share of private sector was about 92 per cent. Investments attracted by food processing sector across India have increased significantly by about 28 per cent during the course of past two years i.e. from a level of about Rs 64,950 crore as of December 2012 to over Rs 82,940 crore as of December 2014," said BhagyeshSoneji, chairperson, ASSOCHAM Gujarat Council. Investment share of other states included
that of Andhra Pradesh (14 per cent), Karnataka (13 per cent), Maharashtra (nine per cent) and West Bengal (six per cent), among others. In terms of people engaged in food processing sector, Gujarat accounted for 5.4 per cent share in the total number of about 1.8 million people across India as of 2011-12. Of these, while food sector employed over 1.62 million people, over 140,000 people had been engaged in beverage processing sector. Further, while Gujarat had over 96,200 people employed in registered food processing sector across the state, majority of which (over 93,100) were employed in food sector and the rest in beverage processing centers as of 2011-12, according to an analysis of the Government of India's Annual Survey of Industries.
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Kwality Ltd enters MoU with Jharkhand govt to set up Rs 100-cr Dairy Unit products at Ranchi with minimum investment of Rs 100 crore. The project, which is expected to generate employment for 300-500, is proposed to commence in financial year 2018-19.
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wality Ltd, one of the leading dairy product manufacturers in North India, entered into a memorandum of understanding (MoU) with the government of Jharkhand for setting up a project of milk and milk
“In addition to investment of Rs 100 crore, it is also proposed that Kwality Ltd will make investment towards Corporate Social responsibility (CSR) besides arranging skill upgradation/ training of youths working population, running ITI/polytechnic etc in PPP or
private mode as per policy of the state government,� said the company in a BSE filing on April 27, 2015. Kwality Ltd, which markets its products under Dairy Best brand, is considered to be one of the fastest growing private sector dairy companies in Northern India. The company has various milk processing plants with a capacity to handle around 3 million litres of milk per day. Currently, Kwality has six manufacturing units located at Palwal (Haryana), Bulandsahar (UP), Saharanpur (UP), Jarar (UP), Sitapur (UP), and Ajmer (Rajasthan).
MoU signed by Haryana and Israel for animal husbandy Dairy Centre
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established in the already existing State Cattle Breeding Project at Government Livestock Farm, Hisar, he added.
Memorandum of Understanding (MOU) for establishment of IndoIsrael Centre of excellence in Animal Husbandry and Dairying sector at Hisar was signed between Haryana government and Israeli government here today. According to an official statement, the MoU was signed in the presence of Haryana Animal Husbandry and Dairy Minister Om Parkash Dhankhar and Charge d Affairs, Embassy of Israel in New Delhi Yahel Vilan. Speaking on the occasion, Dhankhar said that Haryana would enhance its per capita availability of milk with the help of Israeli techniques. Haryana is number one in terms of Murrah breed buffalo, he added. He also said Haryana government is
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collaborating with Israel government for boosting dairy development in the state keeping in view the similar agro climatic conditions in Israel and Haryana. A feasibility study for the proposed centre of excellence in Animal Husbandry sector has already been conducted by Israeli experts. The centre of excellence would be
The establishment of the proposed centre of excellence would be 100 per cent centrallysponsored, getting funds under Rashtriya Krishi Vikas Yojna (RKVY) at least for the initial three years or till such time the infrastructural development of the centre is completed and the initial projected cost of the centre is Rs 14.98 crore, the official statement added. The MOU was signed by Mahavir Singh, Haryana Principal Secretary, Animal Husbandry and Dairying Department and Ilan Fluss, Deputy Head of Agency for International Development Co-operation, Ministry of Foreign Affairs, Israel.
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Glimpses of Previous Event
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