AGRI BUSINESS & FOOD INDUSTRY by Media Today Pvt. Ltd.

AgriBusiness & Food Industry w October 2012

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Event Report

Agri Affairs ...54

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Cold Chain DEVELOPMENT Gathers Pace — Sanjeev Chopra

EDITORIAL

CROP WATCH

Rice Watch

Grand events to upgrade food & grain industry 22

– Vishwanath Kulkarni INTERVIEW

European recession hasn’t hurt Basmati as it is a speciality rice – Karan A. Chanana, Chairman, The Amira Group profileS

India can be a Processing hub for Dairy Industry – T V Satyanarayanan

Cover Story

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Deva Singh Sham Singh Veer Overseas Pvt. Ltd. Kashmiri Lal Sat Pal Khosla Agro Overseas Sifter International Amar Singh Chawal Wala Hind Agro Industries Ltd.

PRE-EVENT REPORT Sial Middle East 2012

Oishii Japan

5th International Horti Expo 2013, New Delhi

ORGANIC FOODS Organic Goodness

– A.K.Singh, President & CEO, Little Bee Impex

Food Safety is the main factor behind the popularity of organic foods

India allows 51 % FDI in multi-brand retail

GOVERNMENT GETS BOUQUETS & BRICKBATS FOR A LONG-DUE MOVE 67 List of Participants at the APEDA Pavilion in SIAL 2012

Production to come down, but prices may remain steady

AgriBusiness & Food Industry w October 2012

Rice & grains to be focus points in upcoming show Boosting New Wave Of Japanese Food Business in Asia

Current Sugar & Honey Scenario in US

– Vishal Jalan, Md, Aricha Trading Company

AGRI EXPORTS India’s agri-food exports register 90% growth

Focus on lucrative Asian fresh fruit and vegetable Markets - Asia Fruit Logistica

Fisheries in India: Prospects & Possibilities

trade NEWS

Apeda wants nothing less than spectacular growth: Asit Tripathy

AgriBusiness & Food Industry w October 2012

Seeding Success through Innovation and Tchnology November 5-6, 2012 Hotel Taj Krishna, Hyderabad

Food 360 Platform provides opportunity for companies to display products, Machinery, products catalogues, services and technological innovation for inputs for Agriculture & Food Processing Sectors through Exhibition Space. It has spacious constructed and raw space for you to reach business community.

Profile of Delegates

Registration Fee

Profile of Delegates

Registration Fee

Non-Members

Rs. 3400/-

Academia

Rs. 1200/-

FICCI Members

Rs. 2300/-

Foreign Nationals

Rs. 5000/-

Stall Fee* 3 x 3 Sq.Mtrs

Rs. 50,000/-

3 x 2 Sq.Mtrs

Rs. 40,000/*12.36% service tax applicable

For Registration, please log on to our website www.ficcifood360.in / for off-line registrations, please contact 040-23395275 / 7207522691

Some of the Eminent Spakers from... 24 Letter Mantra, Abhay Cotex, Advanta Seeds, APEDA, Bharti Wal-Mart, Blue Star Limited, CDAC, Centre for Sustainable Agriculture, CFTRI, Dev Bhumi Cold Chain Ltd, Food Corporation of India, Foods, Fats & Fertilizers Ltd, Foretell Solutions, FRANZ Corp, FrontalRain Technologies, Galla Foods Limited, General Mills, Global Food Innovation Consulting, ICRISAT, IFFCO, Ingersoll-rand, ITC Ltd, John Deere India Pvt Ltd, Licence to Grow, Mahindra and Mahindra, Metro Cash & Cary, Michigan State University, National Bulk Handling Corporation, NSL Sugars, Points Online, PRS-Permacel, Skymet Weather Services, Thomson Reuters, Vasudhaika Software Solutions And other company representatives will address the august gathering at FOOD 360 For Exhibition, Registration / Sponsorship Opportunities, please contact Mr. Ravi Kiran, Ms. Sukanya,

Partners Technology Partner

Process Advisor

Online Partner

FICCI Andhra Pradesh State Council 8-2-601, Plot # 13, 4th Floor, NNR Arcade, Road No.10, Banjara Hills, Hyderabad - 500034 Telefax: 040 - 23395275 / 76 Email: ravi.kiran@ficci.com, sukanya.sundar@ficci.com

Support Partners

Knowledge Partner

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Chief Editor

S. Jafar Naqvi

Consulting Editors

T.V. Satyanarayanan K Dharmarajan

Chief Co-ordinator

M.B. Naqvi

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Vol 9....... Issue 10 ...... October 2012

orial Edit

nion Agriculture Minister Sharad Pawar’s recent statement on government’s intention to continue with its export policy on agricultural commodities like rice, wheat and sugar is indeed significant. He has sought to set at rest doubts in the minds of exporters, particularly rice traders, by saying that the government is against a ‘switch-on and switch-off’ policy on exports. The current export policy would continue and “I don’t see any problem.” Pawar’s statement gains strength mainly from two factors – revival of the south west monsoon and the existing rice stock position. The change of monsoon’s mood to show its benign face in the second half of the crop season has considerably reduced the feared rain deficit, raising hopes of a reasonably good harvest of rice, though, according to the advance estimates of Agriculture Ministry, it is well below last year’s record level. Reports from states show that the crops, adversely affected this year because of erratic rains, are mainly coarse cereals, pulses and oilseeds, barring soyabean. As for rice stocks in the government godowns, they stand at a level which is five times the prescribed buffer stock norms. The Minister’s statement on farm export policy is welcome in the context of another development in international rice trade. There have been reports that five important rice exporting countries in south-east Asia – Thailand, Vietnam, Cambodia, Laos and Myanmar – are considering to form an alliance to share information and cooperate in production and marketing so as to increase rice export prices. A news report appearing in International Herald Tribune has quoted Yanyong Phuangrach, Thailand’s Permanent Secretary for Commerce, as having said in Bangkok that the aim is to form the alliance by the end of the year. Interestingly, International Grain Council, based in London, has estimated that the combined rice trade of Thailand and Vietnam – which usually control nearly half the global trade – would fall to 38 per cent this year as India is emerging as the world’s largest rice exporter. After the government of India lifted the three-and-a-half-year export ban in September last year, the country’s rice shipments have gone up substantially. Sharad Pawar told the Economic Editors' conference that India rice exports in 2011-12 touched 10 million tonnes, including 3.5 million tonnes of Basmati rice. The latest move by five south-east Asian countries to form an alliance follows rice prices remaining relatively stable, unlike wheat, corn and soyabean, which have moved up because of droughts in many exporting countries. In trade circles in India, however, there is skepticism about the new alliance of exporting countries taking shape in the near future. They point out that despite lobbying by Thailand with rice exporters in the region to keep the prices high, Vietnam cut its export prices in response to India’s removal of the export ban last year. Besides there are fears, as expressed by a top official of Vietnam Southern Food Corporation, the country’s largest rice exporter, that any concerted effort to boost prices could lead to protests by rice importing countries waging a fight against hunger. Alliance or no alliance, trade expects a rise in prices this year because of wayward behaviour of monsoon in India, world’s second biggest rice producer, together with play of market forces. It is keeping a close watch on unfolding developments. Comments are welcome at: mediatoday@vsnl.com Views expressed by individuals and contributors in the magazine are their own and do not necessarily represent the views of “AgriBusiness & Food Industry” editorial board. AgriBusiness & Food Industry does not accept any responsibility of any direct, indirect or consequential damage caused to any party due to views expressed by any one or more persons in the trade. All disputes are to be referred to Delhi Jurisdiction only. .....Editor

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Grand events to upgrade food & grain industry

300+ Exhibitors find agro and food processing machineries in high demand

APEDA (Agricultural and Processed Food Products Export Development Authority) stall received maximum eyeballs with its catchy choice of the food products, and the stall being beautifully managed by its officials. Deve Gowda also visited APEDA stall and was impressed by the overall display. APEDA officers R Ravindra presented him with a special artistic bouquet of frozen cut-vegetables to chief guest Former Prime Minister of India Mr. Deve Gowda

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edia Today Group is proud to have organized the 4th India Foodex 2012 along with the 3rd edition of GrainTech India 2012, widely acknowledged as India's largest International Exhibition on grains, cereals, spices, oil seeds, feeds, products & technologies, from 25 to 27 August 2012 at Palace Ground in Bangalore, India. An International Exhibition on Food Products, Processing & Packaging Machinery and Allied Industries, the 4th India Foodex 2012 had a strong support from prominent Indian agri and food organizations adding the strength and value to the event. Among the numerous organizations supporting the exhibition are like The Solvent Extractors'

India is the world's second largest producer of food next to China but accounts for less than 1.5% of International Food Trade. The Indian Food Sectors is poised for a rapid growth and has potential to become reliable outsourcing partner in the Food Industry given its strengths in primary Food Sector. The Indian Food brands are now rapidly increasingly finding prime shelf space in the retail chains across US and Europe.

Association of India, All India Food Processors' Association, Coffee Board, Roller Flour Mills Federation of India, Spices Board, The Soyabean Processors' Association of India, All India Rice Exporters' Association, Indian Oilseeds and Produce Export Promotion Council, and Indian Biscuits Manufacturers' Association. The list is, indeed, long!

mineral water, high protein foods and nutraceuticals, apart from health food and health food supplements, a rapidly rising segment of the food processing industry.

Current Food scenario Looking at the almost certain possibility of food shortage in the world, it becomes imperative to upgrade technologies to increase productivity, and above all, protect food from wastage by developing excellent, cost-effective supply and storage chain. In India alone, around 30 per cent foods are wasted at different stages. In view of all these, India Foodex brings a platform for all food players to come under single roof and provide solutions against this grim problem.

Potential Sectors Prominent among the areas waiting to be tapped are canning, packaging, refrigeration for dairy, poultry, fisheries, meat, ready to eat products, cereals and grains, soft drinks consumer product groups like confectionery, chocolates, coco products, soya-based products,

Govt. Support Having made the sector virtually tax free, Ministry of Food Processing Industries has prepared Vision 2015, targeting an increased level of processing of perishables from 6% to 20%. The Govt. has also approved proposals for joint ventures, foreign collaboration, industrial licenses and 100% EOUs envisaging an investment of Rs. 19,100 crores (US$ 4.80 billion) during the same period. Out of this, foreign investment is over Rs. 9100 crores (US$ 2.2 billion). Other Developments The Ministry of Agriculture is aiming to double the production of all food crops through National Food Security

Mission, NHM, HMNEHS & NHB and disseminating latest and modern practices of production and post harvest care. On the export front, APEDA is targeting agricultural and processed food exports in the range of Rs.4000-5000 crores (US$ 15 billon) in coming years. This year, the exhibition attracted global majors in food industry from several countries. The feedback was very positive and inspiring for everyone. Visitors and delegates came from 13 countries, and the pavilions were crowd-pulling. Some attractions of the Expo are given below. Food segments at India Foodex 2012 The popular expo hosted stalls showcasing tools and technologies

from almost all key food segments such as Food Processing Machinery & Equipments, Food Packaging Machinery, Material & Equipments, Fresh, Processed and Beverage (Non Alcoholic) Food Products like Rice (Basmati & Non Basmati), Spices, Pulses, Cereals, Grains, Namkeen, Corn Flacks, Chips, Tea, Coffee, Ready to Eat Products, Noodles, Pasta, Wheat Flour, Vermicelli, Maida, Sooji, Wafers, Corn, Pickles, Jams, Biscuits, Confectionary, Food Drinks, Ice Cream & other Dairy Products, Live Stock Products, Bakery Products, Coco Products, Honey etc. Hotel & Kitchen Equipments, Grain Milling Technology, Dairy, Bakery Product & Technology, Cold room & Refrigeration Appliances, Perishable and food Cargo Handling, Refrigerated Van & Trucks / Body Builders, Pack

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House/ Warehousing / Surveyors, Digital Temperature Controller & Data Logger, Herbal foods products, Marketing & Export Services, Plasticulture & Aquaculture,Marine Products, R & D Organisation, Post Harvest Technology, . Agriculture & Technology, Poultry Equipments, Sea Food Products & Technology, Food Retailing Supplies, Organic Food Products, Food Testing Lab & Equipments, Food Sector Infrastructure, Post Harvest Technology, Pack Houses/ Warehousing/ Serveyors, Packaging Technology & Services, Grading & Sorting Machinery, Wrapping, Sealing & Lamination Equipment, Elevator / Conveyors / Rotary Separators, Cold Chain Equipment for Perishable Produces. Participants A wide range of participants made their presence felt at the exhibition. They were Food Product Stockists/ Distributors/ Traders, Agri & Food Marketing Board/ Industries/Agriculture Departments, Grocery Shop Owners, Consulates & Diplomats, Bar code / Ink Coding Technology, Banks/ Agri Finance Companies, Quality Certification Agencies, Researchers / Students,

International Delegates, Professional consultants, Agricultural products traders / Wholeseller ,Magazines/ Papers/ Books/ Directories/ CD, Restaurant & Hotel Owner/Sales Managers, Scientists/Universities/ Research Institutions, Corporate Houses/ Food Malls Owners, National and International Retail Chain Owners/ Managers, Fast Food Chain Owners/ Sales Managers, Food Factory Owners/ Sales Managers. Italian attractions Italian pavilions showcased country’s highly developed expertise in food processing, food products, olive oil, snacks, pasta and mechanization of food processing industry. The list of representing companies included Frigortec, Fratelli Lombardo Fu Giuseppe & C. s.r.l., Frame (a division of FRACASSO S.pA.), FISH&CO s.r.l, Ecoteam Srl, and AAT SpA – ORANFRESH. Turkey steals the show Turkish pavilions displaying Turkey’s predominance in food sector attracted a lot of delegates and curious visitors. The companies showcased technologies in the field of food processing, grain milling, storage, machinery, snack, pasta etc. the list

AgriBusiness & Food Industry w October 2012

of companies included Dehsetıler Machınery Steel Constructıon .Co.Ltd., Bastak Gıda Makine Ltd. Şti, Altuntas A.S., Taral Tarim Makine ve Aletleri Sanayii A.S., and UGUR MAK.SAN. GIDA INS.TAAH.END.YAP.TRZ.TARIM DIS TIC.LTD.STI. AAFEX delegation A delegation comprising a dozen people came from AAFEX (Association Africa Agro Export) member countries like Senegal, Burkino, Faso, Cameroon, Gambia and Niger. They participated in fruitful talks and went back with rich and rewarding experience, calling the show ‘par excellence’. With an aim of “Promotion of African Exports in the Agricultural and Agro-food Sectors", and headquartered in Dakar, Senegal, AAFEX is an association of over 100 African companies originating from 17 African countries. APEDA gets thumbs up from Former PM APEDA (Agricultural and Processed Food Products Export Development Authority) stall received maximum eyeballs with its catchy choice of the food products, and the stall being beautifully managed by its officials. Deve Gowda also visited APEDA stall and was impressed by the overall display.

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APEDA officer Mr. R Ravindra, AGM, presented him with a special bouquet containing frozen cut-vegetables. The former PM spent almost three hours visiting different stalls and communicating with the delegates and farmers and complimenting them for the grand display. Dairy show Another hall was full of dairy stalls showcasing the best tools and technologies of the segment comprising dairy products, processing industry, quality control measures, lab certifications, cold chain etc. To create a greater feeling about the urgent need of efficient cold chains, a live display about refrigerated transport was made. The visiting entrepreneurs found everything very enriching and helpful. They came from several countries to explore business opportunities. Indiaâ&#x20AC;&#x2122;s grain scenario Indian agriculture is now going through critical times. On the one hand, relying on its strength of its Green Revolution strategy and having emerged an exporter of grains and food products, the government is keen to enact a Food Security law to ensure minimum food grains to every individual in the country as his or her own right. On

the other hand, the weaknesses in the implementation of the strategy are showing up in a glaring manner. One latest such instance is the huge losses of procured food grains for want of proper storage facilities. The need of the hour is increased productivity of grains and building of an effective supply chain to ensure that what is produced in the farm reaches the consumer in good shape. In fact, what is imperative is to plug every loophole in the food production and distribution system, which means effective use of available technology. Prime Minister Manmohan Singh has been consistently stressing on the need for technology to tackle various ills facing the farm sector. On Union Agriculture and Food Minister Sharad Pawar's own admission, India wastes food grains worth Rs. 58,000 crore every year because of weaknesses in storage techniques and deficiencies in supply chain. This colossal loss of grains rendered unfit for human consumption is all the more unfortunate in a country where a sizeable section of the population goes to bed hungry. India has over 5000 rice mills, 1000 flour milling plants, 200 soybean plants, 2000 spices crushing plants, 1500 pulses mills, 2000 oilseeds crushing units, 1000 feed units, 100

biofuel and energy projects, 1000 Coffee plants etc., looking for new and better technology to upgrade their manufacturing, processing, packaging line. To feed increasing domestic demand and also to achieve the export targets of food products, Ministry of Agriculture, Ministry of Food Processing Industry and Agricultural and Processed Food Products Export Development Authority (APEDA) are investing a substantial share of the budget for promoting technological upgradation and value addition in all segments of rice, wheat, pulses, oilseeds, spices, dairy & feed and all other food sectors. It is against this backdrop that GrainTech India expo and connected events that bring all stakeholders under one roof have to be viewed. It is significant that the Netherlands has continued its association as the Partner country, while Turkey and Italy played the role of being Focus Countries. In his inaugural address, former P M Deve Gowda calls for changes in farm policy. Inaugurating India Foodex & Grain Tech India 2012 and concurrent events, former Prime Minister H D Deve Gowda,

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pithily summed up his solution to the problems facing Indian agriculture: Mechanisation, yes. But mechanisation is not the only answer to successful farming. Mr Gowda called for policy changes, use of latest technology, contract farming and a check on wasteful expenditure to take agriculture forward in India, where the farms are most small and marginal. The inaugural ceremony saw the presence of several highprofile dignitaries like Mr Alfons Stoelinga, Ambassador designate, Embassy of the Kingdom of the Netherlands, Mr Henk van Duijn, outgoing Counsellor for Agriculture in the Netherlands Embassy, his successor Mr Arie Veldhuizen, Ashok Murarka,Chairperson, CAA, Nepal, and Shri R Ravindra, A.G.M, Agricultural & Processed Food Products Export Development Authority (APEDA), Ministry of Commerce, Govt. of India. The Netherlands continued its association with the expo series as the partner country while Turkey and Italy chose to become Focus Countries. Mr Gowda hit hard against what he called ‘strong lobbies’ working

against technology transfer and singled out a specific instance of their having prevented potato seed import from the Netherlands. “Karnataka farmers are struggling with poor quality potato seeds. The situation can be reversed if India is allowed to import the seeds from the Netherlands. However, my attempts to enable this have remained unsuccessful, because the lobby is too strong,” he said. Hailed by participants as a “grand success”, the three-day Grain Tech India also featured the 4th edition of India Foodex and other concurrent events -- Agri Tech India (4th edition), Dairy Tech India (2nd edition) and South Asian Dairy Congress and Poultry & Livestock Expo The three-day multi-show attracted over 23, 000 visitors and more than 300 delegates from all parts of India and more than 20 countries. “I fully support these events,” Mr Deve Gowda said complimenting the organisers. “I think it is of extreme use to the farmers.” According to the organizers, Grain Tech India 2012 successfully brought together all the agrarian business stakeholders under one umbrella. It covered all facets of agriculture and offered an insight into farm mechanisation, pre and post-harvest

AgriBusiness & Food Industry w October 2012

management of food crops, food processing, marketing and retailing. “The primary focus of the event was to help farmers, especially those facing “unpredictable weather and unprofessional market situations,” said M B Naqvi, CEO of Media Today Group. The convention also focused on finding solutions to turn farmers into rural entrepreneurs by giving them means to adopt the latest technology, to compete in the global markets. Partnership The government of Netherlands, which has signed a pact with Karnataka to promote agri business and horticulture, has partnered with the State in food processing, dairy and meat processing. Henk Van Duijin, the Councillor for Agriculture at the Royal Netherlands Embassy in Delhi, said, “Food security is a challenge faced by most countries, and there is a need for global efforts to overlap when it comes to increasing production”. Jafar Naqvi, Chief Coordinator and Chief Editor, Media Today welcomed the guests and delivered an Inaugural Speech. The Royal Embassy of the Netherlands organised a Grand Dinner at Lalit Ashok Hotel where the invitees

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represented virtually the who-is-who of the agri-industry. The Ambassador (Designate) of the Royal Embassy of the Netherlands H E Mr Alphonsus Stoelinga was also present This gala dinner was important as Mr Henk Van Duijn, Agriculture Counsellor of the Embassy of the Netherlands, handed over his charge to his successor Mr. Arie Veldhuizen, who has come from Berlin.

issues as costing, credit and after-sales service, necessary for every foreign manufacturer entering a new market. Mr V. K. Bansal, Vice President, Roller Flour Millersâ&#x20AC;&#x2122; Federation of India, spoke about the national perspective or overall scenario of the flour milling industry, issues and challenges. Over 150 participants from across the country took part in this useful session. In his

technology upgradation Buhler Group, a global major, made a presentation on its technologies that are useful in every step from farm to food. It also showed a corporate film on its tools and technologies, facilities and activities in India and elsewhere. Another presentation was made by PETKUS India displaying its new features about flour milling and silos. This was followed an

Interactive Session for Roller Millers & International Technology Suppliers A special feature of Grain Tech India 2012 was an Interactive Session, which was attended by over 100 roller flour millers, rice millers and grain processors. Members of Karnataka Flour Mills Association were also present. This was a technical platform where foreign technology providers and machinery manufacturers had interaction with their Indian counterparts and prospective buyers. They discussed such

Welcome Address, Karnataka Roller Flour Mills Association President Mr Gopal Krishnan talked about the issues, problems and other aspects of the segment. The programme was also supported by the Food Processing & Packaging Machinery Industry Association, India (FPPMIA). Duttaraj, Former President, RFMFI, and a well-known name in this segment, also shared his experiences and enlightened present delegates about the industry. He talked about the need of

interactive Q&A session & interactive discussion on future development of Indian grain milling industry. S.Jafar Naqvi welcomed and moderated the programme. Overall, the exhibition and conferences were a great success. The organizers have already announced the dates for the next event i.e. 23, 24 and 25 August, 2013, Bangalore. www.indiafoodex.com www.graintechindia.com

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India can be a Processing hub for

Dairy Industry – T V Satyanarayanan

espite having achieved an impressive annual growth rate of 4.2 per cent in milk production in the last decade, vis-àvis the world average of 2.2 per cent, India has to work much harder to meet the domestic demand, going up by leaps and bounds. Emerging trends indicate that the annual demand for milk in this country would be in the range of 200-210 million tonnes by 2021-22, as against the current output 121.85 million tonnes. Going by even a lesser projected demand of 172.2 million tonnes, as assessed by the Planning Commission in the tenth plan, the average incremental increase in milk production in India would need to be around six million tonnes per annum. The trend has to be sustained over a period of next fifteen years. A tall order? This scenario was highlighted by Ms. Rajni Sekhri Sibal, Joint Secretary in Union Agriculture Ministry’s Department of Animal Husbandry and Dairying, in her keynote address to the South Asian Dairy Congress held in Bangalore. The congress was one of the concurrent events held along with Agri Tech India 2012 organised by Media Today group. The congress, attended by experts

and top scientists in animal husbandry and dairying, was coordinated by National Dairy Research Institute, Bangalore. Vast opportunities Ms Sibal sought to drive home the point that the scope, potential and opportunities for dairying are huge in this country. Being a treasure house of experienced manpower with excellent technical know-how, India can be used as a processing hub to tap the benefit of a growing market in the country and markets in the developed economies. After the keynote Address, Guests of Honour made their presentations. Henk

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van Duijn, Counsellor for Agriculture spoke on Nature and Food Quality of the Netherlands, a world leader in dairying... Dr. A.K. Srivastava, Director, NDRI, Karnal, presided over the session. The session was coordinated by Dr. P.K. Dixit, Principal Scientist, NDRI, Bangalore. In his address of welcome, S Jafar Naqvi, Chief Coordinator, said the Dairy Tech India 2012 which was being held simultaneously, showcased everything required to turn a traditional family-owned dairy into a modern dairy business. All inputs required to modernise the dairy sector in India like good breeding practices, milking and

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Challenges of dairy industry

Excerpts from keynote address by Rajni Sekhri Sibal

he Animal Husbandry, Dairy Development and Fisheries sectors play an important role in the national economy and in the socio-economic development of the country. These sectors also play a significant role in supplementing family incomes and generating gainful employment in the rural sector, particularly among the landless labourers, small and marginal farmers and women, besides providing cheap nutritional food to millions of people. Livestock are the best insurance against the vagaries of nature like drought, famine and other natural calamities. Sectorâ&#x20AC;&#x2122;s Contribution The contribution of livestock sector in agriculture in terms of output, which was 17.3 per cent during 1980-81, increased to 28.40 per cent in 2009-10. Similarly, contribution of the sector to National GDP has been around 5 per cent over the years, despite pronounced variation observed in contribution of crop sector to National GDP, indicating the stability of the livestock sector. The value of output from livestock and fisheries sector together at current prices was about Rs. 4,614 billion during 201011 and the contribution of milk alone is about Rs 2,622 billion which was higher than paddy, wheat and sugarcane. India stands first in terms of the bovine population having 20% of the worldâ&#x20AC;&#x2122;s population. In spite of Indiaâ&#x20AC;&#x2122;s position as highest producer of milk, productivity of our bovines is very poor. It is only 1525.20 Kgs/year as compared to the world average of 2,159 Kg/year. The productivity in China and Pakistan are 2140 Kg/year and 1681 Kg/year respectively. We know that the low productivity in our country is mainly due to low genetic potential for milk

milk processing machines, packaging systems and so many other products were on display. Modernisation is vital for dairy development in India, since, only 16 per cent of the milk is at present handled by the organised sector. As a result, only a very small percentage of milk is being

production of non-descript bovines and poor level of nutrition. Yield Increase The milk production in India during last decade increased from 78.3 million tonnes to 121.85 million tonnes. As per FAO, the average growth in milk production in the world during last decade was at 2.2% whereas in India the annual growth rate for the domestic milk production is higher at 4.2% for the corresponding period. An increase in the growth rate of milk production has contributed to increase in the per capita availability of milk close to world average, notwithstanding the increase in human population. Major Constraints In the livestock sector, major constraints experienced by farmers relate to breed, feed and fodder, health care and remunerative prices for the produce. The policy envisages addressing these issues through adopting an appropriate strategy. As Animal Husbandry, Dairying and Fisheries is a State subject; the emphasis of the Department has been on supplementing efforts of the State Governments in the development of these sectors. The Department of Animal Husbandry has been providing assistance to the State Governments for the control of animal diseases, scientific management and upgradation of genetic resources, increasing availability of nutritious feed and fodder, sustainable development of processing and marketing facilities and enhancement of production and profitability of livestock and fisheries enterprises. India -- an emerging market India is one of the biggest emerging markets, with over 1.2 billion population and a 300 million strong middle class. Rapid urbanisation, increased literacy, increased participation of women in workforce and

processed into value added products. Inaugural Session: The South Asian Dairy Congress was inaugurated by Ms. Rajni Sekhri Sibal, Joint Secretary Dept. of Animal Husbandry, Dairying & Fisheries, Ministry of Agriculture New Delhi. In her key note address,

rising per capita income, all have caused rapid growth and changes in demand patterns, leading to tremendous new opportunities for exploiting the large latent market. Demand for milk continues to rise on account of increased consumption and growing population. The per capita household consumption of milk has increased both in rural and urban areas. Government Support Government is actively supporting the dairy sector by implementing various schemes like National Dairy Plan (Phase-I), National Project for Cattle and Buffalo Breeding (NPCBB), Fodder and Feed development scheme, Intensive Dairy Development Programme, Strengthening Infrastructure for Quality & Clean Milk Production, Assistance to Cooperatives & Dairy Entrepreneurship Development Scheme to increase the milk production in the country. The Government through suitable Interventions is assisting dairy cooperatives in creation of infrastructure and improving conditions in dairy plants to ensure proper hygiene and food safety. Cooperative dairy plants are assisted in implementing food safety and quality management systems, achieving energy efficient operation and maintaining clean environment. n

she highlighted the growing relevance of efforts to enhance productivity of milch animals, health management and supply chain management. She assured all possible help for development of dairy industry in India and invited suggestions of dairy professionals

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for possible policy supports. Mr. Henk van Duijn, Counsellor for Agriculture, Netherlands spoke on the occasion and stated that all possible help and cooperation will be extended for improving trades in milk and milk products. Mr. R. Ravindra AGM-APEDA, Bangalore in his address highlighted the growing role of APEDA and stated that APEDA would cooperate in every activity for improvement of dairy sector and international trade. Dr. A.K. Srivastava, Director, NDRI, Karnal, Presided over the function. He stressed the rising importance of milk sector in the Indian Economy and reiterated that the importance would increase in the times to come. He discussed various issues of dairy industry pertaining to Milk Production, Animal Health Management, Dairy Processing, Marketing & Food safety and the requirement of adequate infrastructure to facilitate the development. Mr. M.B. Naqvi, Managing Director, Media Today was also present at the function. Mr. S Jafar Naqvi, Chief Editor, Media Today welcomed the dignitaries on the dias and the august audience. Dr. P.K. Dixit, Principal Scientist, NDRI Bangalore co-ordinated the Session and proposed Vote of Thanks. Technical session 1 : Milk production and animal health management Chairman : Dr C. S. Prasad, Director, NIANP, Bangalore Co Chairman : Mr B. S. Khanna, Regional Director, NDDB, Bangalore Rapporteur : Dr N. K. S. Gowda, Principal Scientist, NIANP, Bangalore Co-ordinator : Dr K. P. Ramesha, Principal Scientist, NDRI, Bangalore

There were four Speakers in the session. The first presentation on Animal Breeding was made by Dr K R Trivedi, NDDB, Anand. He briefed about the National Dairy Plan (NDP) and strategies required to achieve the targeted milk production in India. He emphasized the need of scientific breeding, nutrition and use of information technology. He highlighted the aspects of breeding policies, biosecurity in bull stations, semen quality and progeny testing programme. The second speaker was Ms. Josephine Verhaeghe (Cid Lines) who made presentation on Mastitis control. She elaborated the measures for mastitis prevention and management in dairy herd, including barn hygiene, milkers’ hygiene and udder / teat health. Mr Rakesh Dave (Akaza Nobel KNZ) spoke on the KNZ free choice salt lick. He briefed the need of salt and minerals for dairy herd and merits of free choice salt lick. The last presentation was made by Mr S. S. Tomar and Mr. Aleem Shaikh (De Lavel India) on Animal Health, Milk quality and Mechanization of dairy operations. They focused on the aspects of mastitis, fertility and hoof health, besides comfort of dairy animals and stress management. Based on the presentations made and discussion / suggestion of delegates, the following recommendations were made: l Scientific and agro-climatic zone based breeding policies are required looking into local resources. l Entrepreneurship in breeding and marketing of dairy heifers / cows need to be promoted. l Free choice salt lick should consider the area specific mineral deficiencies and develop area specific free choice mineral licks. l Control measures for preventing mastitis through maintaining

AgriBusiness & Food Industry w October 2012

udder hygiene should be promoted through training of farmers and farm women, NDRI should consider offering such training programs at regular intervals in association with milk unions. l Mechanization of dairy operations integrating biosecurity, feeding, milking, processing and manure management should be popularized at field level through participatory approach involving research organizations, milk federations, SAUs, NGOs and private industry. Technical Session II : Food Safety in dairy Industry Chairman – Dr. G.S.Bhat, Former Vice - Chancellor, KVAFSU, Bidar Co-Chairman – Dr. B.V. Venkateshaiah, Dean PGS, KVAFSU, Bangalore Rapporteur -Dr. B. Srinivas, Senior Scientist, NDRI, Bangalore Session Coordinator – Sri B.S. Nataraj , Former Deputy General Manager, NDDB, Bangalore Mr. Tejbhan Thairani, (Consultant Mehasana Union Unit, Manesar Milk Plant) spoke on food safety in dairy industry. He highlighted that food safety is vital requirement in dairy industry and there must be no compromise on meeting quality standards. He summarized the approaches that would reduce resource wastage and prevention of rejections at production point and also in the market. Mr. Karan Nangia, Managing Director, Benny Impex Pvt., Ltd delivered talk on Milk collection and testing systems in India : Past, Present and Future. He traced the development of milk collection and testing systems in India over time. He envisaged that new era of milk testing would involve infrared, combination of thermal and infra-red and ultrasonic methods, which

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can deliver the complete spectrum of tests in minimum time. He added that these methods are cost effective as well. He stated that Benny Impex (P) Ltd., over the years, provided state-of-the-art products in milk collection and testing. Mr. Thomas Nivert, Director, AllFlex India Pvt. Ltd. presented on Animal identification and tracebility in India. He emphasized that accurate identification of animals would play a pivotal role in dairy industry and facilitate food safety. In order to remain globally competitive, Indian farmers must adopt radiofrequency-based electronic identification (RFID). He also added that application of RFID method benefits producers and also government missionary. Mr. Bernhard Gierl, Negele Messtechnik, Germany spoke on Instrumentation and their role in improvement of process efficiency and safety. He explained that targeting of appropriate action to improve process performance would be greatly improved by putting the application instruments in practice. He stated that various process connections are available as built in systems. Accurate temperature probes, pressure gauges, controllers, signal converters and set point transmitters etc., are helpful in improving the process efficiency. Based on detailed deliberations & suggestions, following recommendations were made, l Food safety should be the binding force of the dairy industry in the country for which adequate measures should be initiated right from the animal, to processing units to market to consumer. l Individual animal identity is must to regulate the quality of milk at producer level and necessary infrastructure development, upto date cleanliness of the production line are

prerequisites to produce safer foods in dairy industry. l Adequate awareness creation, training and manpower development for food safety must receive top consideration. Technical Session III : Dairy Processing and Packaging Chairman – Dr. Satish Kulkarni, Head, NDRI, Bangalore Co-Chairman – Dr. K.L. Gajendran, Former MD, Kolar Milk Union Rapporteur - Mr. B. Nataraj, Additional Director (Quality Control), KMF, Bangalore Session Coordinator – Dr. B.V. Balasubramanyam, Principal Scientist, NDRI, Bangalore Mr. Raghunand Krishnan, Reliance Industries Limited presented on Clarified Polypropylene in Packaging of Dairy and Food Products. He highlighted the necessity of innovations to enhance value addition, improve processing efficiency, and produce quality and safe dairy products. He added that shelflife enhancement by employing novel processing and packaging options will be critical. He stressed importance of Polypropylene (PP) based packaging. He stated that such containers are retortable and microwave ready. He added that this cost effective packaging option is under successful trials in several leading dairies for packaging Sterilised flavoured milk. The speaker informed that M/s Reliance will be very eager to take forward this innovative packaging option to all interested dairy organizations in the country. Mr. A.Suresh, General Manager, Tirumala Milk Products Pvt Ltd. spoke on The role of dairy industry in Rural Economy. He presented the status of dairy industry, milk flow pattern, milk production and per capita

consumption statistics of the country. He identified the emerging trends in dairying such as commercial dairy farms, milk collection at village door steps, etc. He stressed the need for government support to farmers towards setting up of mini dairy farms. He reiterated the need for co-ordinated efforts of govt., research organizations, financial institutions and farmers at large, for an overall development of dairy sector in our country. Based on detailed deliberations / suggestions, following recommendations were made: l Packaging flavoured milk in Polypropylene container is an innovative and cost effective solution. Attempts may be made by dairy industry for its suitability. l Government support is essential to farmers towards setting up of mini dairy farms by providing subsidies and loans at par with agricultural loans. l NDDB & NDRI must concentrate research on improving productivity in cattle. l Training related to Clean Milk Production & Food Safety aspects, need to be intensified. l Developing backward integration like water resources, feed and fodder development, and trained manpower are also very much needed for development of dairying. Media Today Group thanks Dairy Tech India 2012’s Gold Sponsors :

www.dskmilkotronics.com

www.bennyimpex.in

AgriBusiness & Food Industry w October 2012

CoverStory

India allows 51 % FDI in multi-brand retail

Government gets bouquets & brickbats for a long-due move How They See it “We believe that allowing 51 percent FDI in multi brand retail is an important first step for government to further liberalise this sector. This policy change will allow us to connect directly with the consumer and save them money. By being ‘stores of the community’, we will also help them live better. We are willing and able to invest in back-end infrastructure that will help reduce wastage of farm produce, improve the livelihood of farmers, lower prices of products and ease supply-side inflation.”

Raj Jain, President,

Walmart India, MD & CEO, Bharti Walmart

"Cynical political parties are opposing reforms like FDI in retail, which could boost the growth of entire, interdependent e c o n o m y . Opposition parties support policies when in power and oppose them hypocritically when out of power. This must end.”

GR Gopinath, Founder, Air Deccan "The announcements have restarted the reform process. Easing FDI norms would help mobilise capital into these sectors and improve India’s current account deficit situation."

Adi Godrej, President, CII

n a bold move, which has triggered wide protests, the UPA government has taken a decisive step to open the retail sector for foreign direct investment. Prime Minister Manmohan singh has described the decision as one which would spur economic growth and generate more productive jobs for the country’s youth. The decision to allow 51 per cent FDI in multi-brand retails was among a slew of measures announced by the government, hoping get India’s sagging economy back on growth track. Earlier, the Cabinet had cleared pending proposals on easing FDI norms in multi-brand retail, aviation, power trading exchanges and broadcasting. This came a day after the announcement on hike in diesel price and putting an annual cap on use of LPG cylinders

AgriBusiness & Food Industry w October 2012

to reduce the burden of fuel price subsidies. So far nine states and two union territories have agreed to allow FDI in retail. Allaying fears that FDI in retail would harm the interests of small traders, Montek Singh Ahluwalia, Deputy Chairman of Planning Commission, said, “I don’t think FDI in retail is a threat to small retailers. Modern retail is the expanding segment. Those who say the small sector would be hurt are wrong”. The verdict, however, evoked mixed response. Here are some positive and negative reactions:

Those who welcome the move:

Industry Pleasantly surprised by the sheer magnitude of the far-reaching measures unleashed by the government, leading industrialists have reacted with a great

CoverStory sense of relief. Many quickly went into ‘twitter’ mode to hail the government. The domestic industry hopes that the spate of economic reforms announced by the Government will be a “mood lifter”, improving the global perceptions on India and having a positive effect on its sovereign rating. Adi Godrej, President, CII, said that the announcements have “restarted the reform process”. He said that easing FDI

Mallika Srinivasan, Chairman of TAFE, a leading tractor maker, felt, these were bold and visionary moves, and a welcome one at that. “We must thank the commerce minister and the government for this,” she said. According to her, the opening up of multi-brand retail for FDI would help farmers get a better return. “I guess it is a well debated and discussed move, and will be implemented,” she said. This,

How They See it ”The move signals to the investor community that India is committed to furthering reforms. The States have been allowed to take a final decision on this subject and we are hopeful that they will respond positively to this policy initiative”

R.V. Kanoria, President, FICCI “These were bold and visionary moves, and a welcome one at that. We must thank the commerce minister and the government for this. The opening up of multi-brand retail for FDI would help farmers get a better return. I guess it is a welldebated and discussed move, and will be implemented. This, in effect, would improve productivity and processes in the farm sector. The FDI in multi-brand would also result in greater investment into areas such as cold storage and transportation”

Mallika Srinivasan,

norms would help mobilise capital into these sectors and improve India’s current account deficit situation. On opening of FDI in multi-brand retail, FICCI President, R.V. Kanoria, said that the move signals to the investor community that India is committed to furthering reforms. “The States have been allowed to take a final decision on this subject and we are hopeful that they will respond positively to this policy initiative,” he said. Assocham commended Prime Minister Manmohan Singh for his “exceptional courage amidst stiff opposition”. Meanwhile, Sunil Bharti Mittal, Chairman and Group CEO of Bharti Enterprises, congratulated the Government on its “bold decisions”. He added, “This sends out a clear message to the global investor community that the Government is committed to taking forward next generation economic reforms.”

in effect, would improve productivity and processes in the farm sector, she added. The FDI in multi-brand, she felt, would also result in greater investment into areas such as cold storage and transportation. Paresh Parekh, Tax Partner - Retail Practice, Ernst & Young India, said the reforms, one of boldest steps, deserve a big welcome. “I hope this will be reflective of new era of reforms and reinstil investor confidence in India. Global retailers will now definitely get back to their drawing boards to explore India plans.” PwC India’s Executive Director (Retail), Akash Gupt, said that FDI in retail will help the farmers maximise their earnings and value. “Indian retail players are today bleeding and they will have access to overseas funds which will allow the Indian players to harvest their value and be a partner in the retail growth story,” he said.

TAFE

Chairman of

” I congratulate the Government on its ‘bold decisions’. This sends out a clear message to the global investor community that the Government is committed to taking forward next generation economic reforms.”

Sunil Bharti Mittal,

Chairman and Group CEO of Bharti Enterprises “For farmers, FDI is not a blessing in its present form; it is neither good enough a deal to fight for, nor bad enough to pull the country to a halt.”

Ajay Vir Jakhar, Krishak Samaj

Chairman, Bharat

AgriBusiness & Food Industry w October 2012

CoverStory

FDI in retail no threat to small traders – Manmohan Singh

r i m e Minister Manmohan Singh was emphatic in his televised address to the nation that the government decision to allow foreign investment in retail trade would not harm small traders. Such fears are “baseless”. The decision, in fact, would benefit the farmers and consumers, reduce wastage and create more jobs for the youth. Here are excerpts from the text of his speech: Let me now turn to the decision to allow foreign investment in retail trade. Some think it will hurt small traders. This is not true. Organised, modern retailing is already present in our country and is growing. All our major cities have large retail chains. Our national capital, Delhi, has many new shopping centres. But it has also seen a threefold increase in small shops in recent years. In a growing economy, there is enough space for big and small to grow. The fear that small retailers will be wiped out is completely baseless. We should also remember that the opening of organised retail to foreign

Reaction from states Haryana CM

Haryana Chief Minister Bhupinder Singh Hooda hailed the Union Cabinet’s decision to liberalise foreign direct investment (FDI) in multi-brand retail trade.

investment will benefit our farmers. According to the regulations we have introduced, those who bring FDI have to invest 50% of their money in building new warehouses, cold-storages and modern transport systems. This will help to ensure that a third of our fruits and vegetables, which at present are wasted because of storage and transit losses, actually reach the consumer. Wastage will go down; prices paid to farmers will go up; and prices paid by consumers will go down. The growth of organised retail will also create millions of good quality new jobs. We recognise that some political parties are opposed to this step. That is why state governments have been allowed to decide whether foreign investment in retail can come into their state. But one state should not stop another state from seeking a better life for its farmers, for its youth and for its consumers. In 1991, when we opened India to foreign investment in manufacturing, many were worried. But today, Indian companies are competing effectively both at home and abroad, and they are investing around the world. More importantly, foreign companies are creating jobs for our youth -- in Information Technology, in steel, and in the auto industry. I am sure this will happen in retail trade as well.

Congratulating Prime Minister Manmohan Singh for his “bold initiative”, he said: “This will benefit all stakeholders, specially the farmers and the consumers, and will attract investment in Haryana which accounts for 44 per cent of the National Capital Region area and offers a huge market.” Rajasthan CM Rajasthan Chief Minister Ashok Gehlot welcomed the Union Cabinet’s decision allowing foreign direct

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investment (FDI) in multi product retail in the country. The decision, he felt, would help farmers get remunerative prices for their produce and eliminate the role of middlemen. He also hailed the Cabinet’s decision to leave the implementation of the decision to the States. “The multi brand retail and the foreign direct investment will prove a boon to the rural economy. This will help employment and enhance the income of the rural people,” said Gehlot. He said the provision for compulsory 50 per cent investment in building of cold storages would help employ lakhs of youth. Andhra CM Andhra Pradesh Chief Minister N Kiran Kumar Reddy said the state would welcome foreign direct investment in multi-brand retail as it would help both consumers and farmers. "I have already communicated the state's consent to the Centre." Lack of proper facilities (for processing and storage) was letting precious aqua products, vegetables and grains to rot. "There will be a lot of value-addition to our produce which will ensure quality products to the consumers at lesser prices. Obviously it will benefit the farmers as well," Reddy added. Delhi CM Welcoming the Union government's decision to allow 51% FDI in multibrand retail, Chief Minister Sheila Dikshit described it as a step forward and a positive move for Delhiites. The Chief Minister feels the decision will lead to less wastage of food

CoverStory

Retailers gear up for the big rejig

ndia's top retailers, including the Future Group, Bharti Retail, Spencer's Retail, Videocon's Next Retail and Gitanjali Group, plan to split their operations before selling stakes to foreign players, which may delay the induction of fresh investments. The retailers will have to restructure operations since many of their stores are in states opposed to foreign investment in supermarkets. Retail companies are waiting for the official notification, which will spell out the guidelines, before beginning the process of restructuring. The government on Friday allowed foreign companies to invest up to 51% in supermarkets in India, but left it to state governments to decide whether they would allow such stores within their boundaries. A senior government official said overseas investors will have to seek no-objection certificates, or NOCs, from individual states before approaching the Foreign Investment Promotion Board, the nodal body that clears foreign investments. The board may even invite representatives from the state governments concerned to attend its meeting when investment proposals are considered. In case a state opposed to foreign investment changes its mind and an MNC-funded retailer decides to invest there, the company will have to furnish a fresh no-objection certificate from that state. "There will not be a one-time, allIndia permission. Retailers will have to come with state-specific plans," said a senior official of the Department of Industrial Policy and Promotion. To comply with these proposed guidelines, promoters and senior executives of leading retail chains said they were gearing up to modify operational structures before forging deals with foreign partners. Bharti Enterprises, which operates 217 Easy Day stores in which the world's largest retailer Walmart is likely to invest, will carve out stores operating in FDI-friendly states and create an organisational structure to attract investments, said Vice-Chairman & MD Rajan Bharti

Mittal. "We have to create structures accordingly," he said. India's largest retailer Future Group, too, said it was ready to modify its structure. "We have to wait for the final notification before taking a decision, which could take another month. These are early days yet, but our organisation is structurally ready to look at any viable partnerships," said Pantaloon Retail MD Rakesh Biyani. Pantaloon Retail is the flagship of the Future Group. Videocon Chairman Venugopal Dhoot said his group has appointed KPMG to restructure the operations of Next Retail. As per the plan, Next will be split in two - one company will operate in FDI-friendly states along with a foreign partner (who will pick up a 51% stake), and the second will be wholly owned by Videocon that will operate in other states. "The process will be lengthy, and it will take at least 6-9 months to restructure our operations," said Dhoot. The Videocon Group chief expects states opposing FDI in retail to relent gradually. His foreign partner will have the right of first refusal to pick up stake in stores located in states that decide to allow foreign investment at a later date. India's largest jewellery and lifestyle retailer, Gitanjali, plans to create either a two-company structure or a special purpose vehicle to attract foreign investment. The group runs 700 standalone jewellery and lifestyle stores, and 11 departmental stores christened Maya. "We have already streamlined operations by ensuring that each store format is run as a separate company. For the formats where we bring in a foreign investor, we would tweak the structure accordingly," said Gitanjali Group Managing Director Mehul C Choksi. Foreign retailers would also get to sell imported foods thus giving more freedom of choice to consumers. Spencer's Retail, on the other hand, is exploring the option of splitting its backend and front-end operations into separate

entities and invite a foreign investor in the back-end. A person familiar with Spencer's plan said the company would not cede majority control and will use the money to strengthen the supply chain infrastructure. "This structure would be operationally efficient and hassle-free, since the front-end will not have any foreign investor allowing Spencer's to operate stores across the country," the person said, requesting anonymity. At least 10 states, including West Bengal, Uttar Pradesh, Tamil Nadu, Gujarat, Bihar, Karnataka, Kerala, Madhya Pradesh, Tripura and Odisha, have opposed FDI in retail and said they will not allow overseas companies to set up stores within their boundaries. The Centre says it has received direct or indirect approval for retail FDI from Delhi, Assam, Maharashtra, Andhra Pradesh, Rajasthan, Uttarakhand, Haryana, Jammu & Kashmir, Manipur, Daman & Diu, and Dadra and Nagar Haveli. Retail companies acknowledge the kind of restructuring they are considering to tap foreign investment will not be easy. "Structuring FDI deals will be quite complicated in the current scenario. The two options for most retailers are to either float state-wise special purpose vehicles or segregate the front and back-end. Considering the rules and political reality, it is unlikely that billions of dollars will flow into India overnight since structuring these deals will take time," said Govind Shrikhande, managing director of Shoppers Stop.

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CoverStory

"We will never allow FDI in multibrand retail sector in Bihar because it is a suicidal decision of the central government." "They (multinational companies) want our markets... Shiny markets won't help farmers. It is beyond my comprehension as to how the interest of the owners of small and medium-sized retail shops would fit in the WTO (World Trade Organisation) regime."

Nitish Kumar, CM, Bihar

and vegetables, better quality of goods and abundance of jobs. "As of now about 35% to 40% of the food particularly vegetables get spoilt. But with FDI in multi-brand retail, things will show a marked improvement. I am certain we will manage to prevent wastage," said Dikshit. Assam CM

Assam Chief Minister Tarun Gogoi welcomed the 51 per cent FDI in multi-brand retail, saying those states opposed to it should not prevent others from implementing it. Gogoi described the decision of the Union Cabinet as "bold" and said under no circumstances should it be reversed. "I welcome the decision. It will benefit the farmers, consumers and boost the rural economy with the setting up of cold storage and other infrastructure," he told a press conference.

Those who oppose the move:

Trade Unions Central trade unions held a demonstration at Jantar Mantar (Delhi) to protest against the Government’s decision to hike diesel price, curtailment of subsidy in LPG, and allowing foreign direct investment in multi-brand retail trade. The unions that protested include the BMS, AITUC, CITU, AICCTU, AIUTUC, TUCC and UTUC. Condemning the diesel price hike, union leaders warned that this would have a cascading effect on prices of essential commodities and further fuel inflation. “Withdrawal of subsidy on LPG will hurt the budget of millions of people who are already reeling under burden of soaring prices. . . . .The entry of FDI in single brand and multi–brand retail trade will take away livelihood of several of millions of Indians,” a statement released by the unions said. The corresponding creation of jobs by the corporate sector in the retail trade would not be able to offset this large-scale job loss in the unorganised retail trade, the unions said. The leaders said the recession was already affecting the common man’s capacity to buy goods and with inflation, it would go down further. The unions gave a call to workers everywhere to “protest in a suitable manner” all over the country for rollback of these decisions.

AgriBusiness & Food Industry w October 2012

Meanwhile, the National Association of Street Vendors of India (NASVI) called upon small retailers to take to the streets in protest again the Central Government’s decision to allow FDI in their sector. It said the FDI infiltration into retail sector would adversely impact the livelihood of vendors and small retailers, leading to drastic reduction of this section’s massive contribution to city, state and national economies.. NASVI national coordinator Arbind Singh accused the Government of protecting the interests of realtors and mall developers. “FDI would ruin the retail and help the realty sector as the move would create demand of mall and real estate developers for retail space. While at one level the UPA Government was introducing the Bill to protect livelihood of street vendors, on the other it was allowing multinational retail giants to further threaten the livelihood of vendors,” he said. Praveen Khandelwal, Secretary General, Confederation of All India Traders, termed the move as unfortunate, and said, “The Government has allowed multinational corporations to dominate and control the retail trade.” No fears However, all small traders are not opposed to FDI. Some even said they do not fear foreign retailers as they are well-equipped to compete with

CoverStory

Large farm lobbies back the government

arge farm lobbies are backing the government's decision to allow foreign supermarkets to set up shops in the country, saying the move will shorten the supply chain and get growers a larger share of the final selling price. Most farmers, however, want the government to go a step further and make it mandatory for retailers to buy 75% of their produce directly from farmers, thereby bypassing the "restrictive" mandi auction system. "Traders and middlemen push up prices but farmers do not get a rupee more. No political party is talking about our interest because we are not organised the way labour unions are nor do we have deep pockets like traders. India has 600 million farmers, 1,200 million consumers and 5 million traders. Both farmers and consumers are benefitted by the government decision," said P Chengal Reddy, secretary general of Consortium of Indian Farmers Associations (CIFA). The policy reform will have a positive impact on the entire supply chain from farm to fork and will benefit all, said Ajay Jakhar, chairman, Bharat Krishak Samaj. The organisation has more than 75,000 progressive farmers under its fold. However, he says that it should have been made mandatory for foreign companies to purchase more than 75% of fruits and vegetables directly from farmers. "We are fine with this policy but not thrilled," he said while emphasising that he had hoped for "something more" to help farmers become part of India's growth story. The farming community, desperately wanting an alternative to the "exploitative" system of APMCs and middlemen, is looking at FDI in retail as an opportunity to explore new marketing arrangements. "Our government has not been able to bring transparency in the way agricultural produce price is decided by the middlemen at APMCs. Doing away with the middlemen is most important for us. It will not only help farmers but also consumers," said Raghunath Patil, chairman, Maharashtra Rajya Shetkari Sangathana. "FDI in retail will open alternative avenues of sale for us," Reddy added. He said the mandi system does not favour farmers because they lose 5%

of the value in transportation, 10% in broker commission and 10% in quality parameters. "Direct purchase by large retailers will solve this problem," he said. The thumb rule of pricing from a farmer to a consumer in perishables such as fruits and vegetables is 1:2:3:4. What a farmer sells for 1 is sold at the mandi for a 2-fold gain, which becomes 3-fold at the consumption end of the mandi and 4-fold when it reaches the consumer through a retailer. The government has said that at least 50% of total foreign direct investment brought in shall be invested in 'back-end infrastructure' within three years of the induction of FDI. 'Back-end infrastructure' will include investment made towards processing, manufacturing, distribution, design improvement, quality control, packaging, logistics, storage, warehouse and agriculture market produce infrastructure. Sanjay Kaul, MD of leading supply chain solution provider National Collateral Management Services, said: "India loses nearly 20% -40% of its 230 million tonne of fruits and vegetables annually due to lack of proper storage system. We require more cold chains in the country. The return from this investment is at least 10-12 years. Therefore, we have to see whether foreign companies can take such a long risk on their capital investment. But this is a good move by the government to create back-end infrastructure and opens up possibilities of setting up joint ventures in this sector." Gokul Patnaik, chairman of Global Agri System, which is into consultancy and supply chain managements, said FDI in retail was good but not to be seen as a panacea. "We hope that the new policy will help in people looking at agriculture as an end-to-end business and not a piecemeal approach," he said. Farmers said there was an immediate need to set up agri infrastructure. Meanwhile, farm lobbies are planning to meet CMs on retail FDI and are organizing workshops in villages to create awareness among farmers on how it can help them to achieve better prices. Himachal farmers are also excited about FDI as it would help them with cold chains and an efficient transportation system, which no one can provide as it needs tons of money.

How They See it "Our campaign would spread awareness at the grassroot level that FDI is a blessing which would lead to massive job generation, inflow of foreign investments in villages, reduce farm wastage, provide farmers' their due in form of higher prices for their produce and will not have any impact on kirana merchants in any way whatsoever"

Assocham, President, Rajkumar Dhoot them. They are progressive retailers who know how to woo today’s smart customers. Tejpal Bansal of Noida Sector15 is such one kiranawala. He said, “Customers prefer my store as we give them friendly atmosphere, A-class service and good products at reasonable rates. These global retailers like Wal-Mart cannot pull customers from all corners. Every player has a place in this sector. Small shops will never go, as they fulfill daily household needs. Apart from this, big retailers do not entertain bargaining while we do it. So, there will be no effect of FDI on us.” Pradeep Kumar (Baksa Market, Gurgao) concurs with Bansal. He said, “The numbers of our customers are increasing as we have changed our marketing strategy. We have friendly workers who keep customers happy. We give good service, excellent products and occasional discounts, specially during festivals. So, we do not oppose or fear FDI or Wal-Mart”.

AgriBusiness & Food Industry w October 2012

CoverStory Political Parties

Political party leaders Mayawati, Mulayam Singh, Mamata Banerjee, and most vehemently, BJP leaders are up against this verdict. Bharatiya Janata Party’s Arun Jaitley said that the United Progressive Alliance (UPA)’s decision to open Foreign Direct Investment (FDI) in multi-brand retail could lead to loss of manufacturing jobs and retail sector growth. It would jeopardise the livelihood of four crore domestic retailers in business. All this would eventually lead to loss of food security. “About 18 to 20 per cent of the workforce would be adversely affected as it depended on the domestic retail sector, he said, adding that international retail companies would not create any new job opportunities but would only displace the existing workforce. He said that India’s purchasing power, with one sixth of the world’s population, was making the (international retail) companies to look at it as a big bazaar. The BJP had withstood pressure from the United States and European Union to open up retail sector for the FDI, but “a submissive Prime Minister has agreed to it.” “It is a decision for which India, at least, is not prepared today and I can’t understand the compulsion,” Jaitley said.

Bihar CM

Bihar Chief Minister Nitish Kumar said that his government would not allow foreign direct investment (FDI) in the multi-brand

retail sector in the state. "We will never allow FDI in multibrand retail sector in Bihar because it is a suicidal decision of the central government," Nitish Kumar told reporters. "They (multinational companies) want our markets... Shiny markets won't help farmers. It is beyond my comprehension as to how the interest of the owners of small and medium-sized retail shops would fit in the WTO (World Trade Organisation) regime," he said.

More Viewpoints

**According to A. Srivathsan, a columnist, India could emulate Japan, Indonesia and Thailand which used zoning laws and size regulation as a control mechanism to reign in the global behemoth retail houses. “Forced by political circumstances, Asian governments tried to provide a levelplaying field, framing regulations to balance everyone’s interests,” he said. **”Cynical political parties are opposing reforms like FDI in retail, which could boost the growth of entire, interdependent economy, said GR Gopinath, Founder of Air Deccan. “Opposition parties support policies when in power and oppose them hypocritically when out of power. This must end,” he added. **Ajay Vir Jakhar, Chairman, Bharat Krishak Samaj, said, “For farmers, FDI is not a blessing in its present form; it is neither good enough a deal to fight for, nor bad enough to pull the country to a halt”. **S. Murlidharan, a chartered accountant, writes, “The truth is investors view India as a nation and baulk at suggestions at fragmentation, in their enlightened self-interest”. Echoing

AgriBusiness & Food Industry w October 2012

similar views, London-based Himanshu Pal, Director of Retail Insights with consultancy Kantar Retail said, “The market has opened up in pieces and so it is crucial that retailers evaluate the returns on their investments over a medium to long-term”. **Rachna Nath, Leader (Retail), PwC, said, “Restructutring will be a very important aspect. We have to see if states supporting FDI will allow the restructuring norms, and if yes, then how”. **Shekhar Swamy, Group CEO, R K SWAMY HANSA, and Visiting Faculty, Northwestern University, US, said, “A system that generates wealth and jobs for millions will be replaced by retail giants with the pricing power to squeeze farmers and consumers”. **Ritesh Kumar Singh (Group Economist of a corporate house), and Prerna Sharma (Research Analyst) writes, “FDI in retail alone cannot deal with supply bottlenecks in food; it must be accompanied by measures that address infrastructural hurdles and business-unfriendly environment”.

As the Commerce Ministry views it:

Full-page ads published in leading dailies by the Ministry of Commerce and Industry lists the following benefits of FDI in retail: “Better price for farmers, lakhs of new jobs, relief to consumers”. According to it, 50% of total foreign investment will be in villages, and it would transform rural India through improved agro processing and cold chain, and will reduce wastage. Around 1 crore jobs will be created and new manufacturing opportunities will come up, and consumers will get good quality farm products at reduced prices. n

cropwatch

Rice Watch Production to come down, but prices may remain steady – Vishwanath Kulkarni

he country’s rice output that touched a record high of 104.3 million tonnes (mt) last year could see a marginal dip this season ending June. This is on account of a shortfall in kharif acreage, as scanty rains during the early phase of monsoon hit plantings in Andhra Pradesh and Karnataka. However, crop prospects have

improved with the monsoon’s revival in August. The showers are seen aiding the standing crop that is in grain formation stage. Besides, they also led to expansion of acreage. Transplantation of paddy is still on in key eastern rice-growing States of Bihar, Chhattisgarh and West Bengal. CROP SIZE Various estimates peg the crop size in

the range of 98 to 102 mt. The rice trade estimates the crop to be around 100 mt, while the Food Ministry expects it to be at last year’s level. The recent pick-up in monsoon prompted the United States Department of Agriculture to raise its estimates to 98 mt from its earlier forecast of 94 mt in August. The Food and Agriculture Organisation expects the rice crop to

dian Basmati samples USFDA finds arsenic in In sue: Vijay Setia This is just a technical is

he US Food and Drug Administration (USFDA) has found arsenic content in about 30 samples of Indian basmati rice in its preliminary analysis. The regulator would issue advisory to consumers only after completing its entire study. However, exporters from India said that basmati rice was free from arsenic content as shipments are made only after complying with required tests. Arsenic is a chemical matter present in the environment from both natural and human sources. It is found in water, air, food and soil in organic and inorganic form. As of now, the USFDA has collected 200 samples of rice and rice products available in the American market from different countries including India. “The FDA is in the process

of collecting and analysing a total of approximately 1,200 samples to examine the issue thoroughly. This data collection will be completed by the end of 2012. Once the data collection is completed, FDA will analyse these results and determine whether or not to issue additional recommendations,” the USFDA said in a release. Of 200 samples released, as many as 34 samples were from Indian origin basmati rice. Of that, 31 samples contained inorganic arsenic content in the range of 1.8 to 6.5 microgram per serving. When asked about the preliminary findings of the USFDA, All India Rice Exporters Association (AIREA)’s former President Vijay Setia said, “Indian basmati rice is free from arsenic content as we export only after testing water and rice.” India, the world’s largest producer and exporter, ships about 2 million tonne basmati rice a year.

AgriBusiness & Food Industry w October 2012

Threatened by rising rejection and holding up of rice consignments in US due to higher than permissible pesticide residues, the Rs. 24,000 crore rice export industry has decided to educate farmers on the issue. The exporters will advice them to adopt good agriculture practice by controlling the pesticide residues or face rejection by exporters. However, calling it a ‘technical issue’, Vijay Setia further said, “Indian rice has no pesticide issue anywhere in the world. USA has a technical issue and certain reservations. For it, pesticides that are not used in USA are alien for them. The government of India has engaged concerned American authorities on this matter, and the issue will be sorted out soon, since residues are well within safety levels of EU and Japan.”

cropwatch be around 99 mt, while the Centre for Monitoring Indian Economy has pegged it at around 102 mt. The rain deficit, which stood at 29 per cent as of end-June, stands reduced to around 7 per cent as of mid-September. This sharp recovery could help boost rice yields but may not reverse the damage. So far, the total rice acreage is down by 5 per cent at 361.64 lakh hectares, which may keep the output lower than last year. Kharif is the main season for rice crop, which is typically sown in June-July and harvested in NovemberDecember. About 84 per cent of the country’s rice is grown during this season. SOUTH SITUATION “The crop condition is almost normal except in Andhra Pradesh and Karnataka, where drought has hit planting,” said M.S. Diwakar, Director of the Patna-based Directorate of Rice Development. In Andhra, where acreage is down by about 4 lakh hectares, farmers have switched over to crops such as cotton, pulses and maize. Diwakar expects the shortage of water availability in the Cauvery basin could also result in lower acreage in Tamil Nadu, where rice area has declined by 1.6 lakh hectares to 2.28 lakh hectares over corresponding previous year.

The acreage decline in these States is partially made up by higher planting in Chhattisgarh, Madhya Pradesh and Maharashtra. PRICE, STOCKS Vijay Setia, former President of All-India Rice Exporters Association, expects rice output at 100 mt. The improving quality in inputs, such as seeds and planting technology, would help boost the yields, he added. However, the marginal dip in output is unlikely to be a cause of worry as the stockpile with the Government is about five times the prescribed buffer norms. As a result of a huge surplus, the rice prices are expected to rule steady, says Setia. As on September 6, rice stocks in the Central Pool stood at 25.59 mt, much higher than the stipulated buffer of 5.2 mt as of October 1. Setia estimates India’s consumption at 94-95 mt and with a projected output of 100 mt coupled with surplus Government stocks, “the availability of rice would be comfortable”. Meanwhile, paddy arrivals have started in Karnal, the key market in Haryana. The arrival of non-basmati paddy is likely to be in full swing by the end of this month, said Sewa Singh Arya, a rice trader and President of

Bharatiya Kisan Union in Haryana. “The arrivals are not regular, as the crop is not fully matured in all parts. Farmers who have harvested their crop are coming in the grain market, as they don’t want to take chances with the matured crop. Paddy arrivals of aromatic varieties may start by the end of October,” Arya added. M.P. Jindal, President of AIREA, said farmers were likely to get better prices than last year, as rice prices in the international market have increased and production is low this year. EXPORTS TO CONTINUE The sufficient stocks should prompt the Government to keep rice exports open this year. India, which re-opened non-basmati rice exports since September 2011, shipped 5.64 mt till mid-July. Another 1.1 mt is registered for exports through the land custom stations. Including basmati shipments, India has emerged as the largest exporter of rice for the year-ended March 2012 and is expected to remain a key player this year. Courtesy: Hindu Businessline

AgriBusiness & Food Industry w October 2012

interview

European recession hasn’t hurt Basmati as it is a speciality rice Founded in 1915, the Amira Group continues now to be owned by the same family. It has evolved from trading to processing, branding and distribution of rice and agro commodities. Quality-control, and consumer-friendly leadership are its strong points. In an engaging chat with Agri Business & Food Industry, Karan A. Chanana, Chairman, Amira Group, tells about global basmati trade scenario, India’s status, and his own brand’s future plans, among other things. Excerpts: facing tough competition from Pakistan? What are your views on this? India is and always will remain a leader qualitatively and quantitatively. Indian basmati is far superior in quality and this enables the price premium.

Karan A. Chanana

Please tell us about overall scenario of global Basmati trade, India’s position in the international markets, and your own company’s status? Basmati is a speciality rice and is approximately 1 per cent of the global production and 3-4 per cent of the value. Amira is the largest private rice company in India, covering 40 countries, and is growing further. Recession in Europe is hurting Indian basmati exports, but at the same time, the demands at other international regions are high as well. Do you think due to this, this recession has negligible impact on Indian basmati exporters? European recession has ' not ' hurt basmati as basmati is a speciality rice. Gulf market is a major destination of Indian basmati. But now India is

Iraq has been a traditional buyer of India’s basmati, but according to a news story, recent US political pressure is forcing Iraqi importers to buy US longgrain rice instead of Indian basmati. Is it a matter of concern for Indian exporters, or do you think government should do something? Iraq government is buying USA long grain for its food distribution. Indian basmati rice consumption has grown hugely in Iraq and Indian basmati exports to Iraq are growing. Iran has been a major buyer of India’s basmati despite tough US sanctions. But it is facing payment issue. Does it affect the trade badly, or is there any relaxation in regard to payment issue? Iran is a market which will remain uncertain till sanctions remain and can’t be relied upon. If we compare exports with domestic markets, we see that domestic markets are no less strong. In fact it is more lucrative. But due to lack of proper branding and distribution centres, the picture is not as great as it should be. What are your views, and would you expand in domestic markets in near future? Domestic market actually carries huge potential. As the modern trade grows and the infrastructure in India grows, the market will take further prominence. Amira Foods is concentrating and

AgriBusiness & Food Industry w October 2012

expanding its presence in the domestic market and has opened its first depot for direct distribution. It will open many more such depots, going forward, enabling depth of distribution. Modern retailing is emerging as a strong segment where the profit margins of retailers are high and low for rice traders. Despite this, rice traders are keen to sell basmati to retailers as the bulk of basmati consumers are high-end customers. Can you share your thoughts on this trend, and your experience with a retailer like Food Bazar, Spencer or Reliance Mart? Modern trade is actually good for the professional brand owners as it allows pricing and branding to be controlled by the brand owner. Modern trade profit margins are the same globally and no different in India. We at Amira find better margins with modern trade as there is total transparency. Most of the Basmati traders are entering value-added segments due to reasons like new generation’s preference of readyto eat food and snacks, and high profit margins. Do you have any plan to do the same? Amira has actively innovated and have introduced 'KHEER Rice and KHICHDI Rice'' which other people have copied and followed from us. Amira has entered the large snacks segment with Amira snacks. We at Amira always set the trend for others to follow allowing us to be a 'natural leader' Any other thoughts, ideas, suggestions? The basmati rice industry must enforce standards for sale in the domestic market. n

AgriBusiness & Food Industry w October 2012

profile

Deva Singh Sham Singh

Maintaining an impeccable reputation for consistent quality

R S Chatha

Managing Partner

eva Singh Sham Singh (DSSS) is one of India’s oldest and reputed companies, incorporated in 1920 and receiving the country’s 817th registered trademark. This family-owned company has an international reputation for milling and exporting the finest Indian traditional basmati rice. Indian traditional basmati rice is grown at the foothills of the Himalayan Mountains in the geographical region of Punjab, Haryana and Uttarakhand. The climate and soil, unique to this region of the Indian subcontinent, are essential to the cultivation of this particular grain. Recognised as a gourmet food product, basmati rice is arguably the most flavored and aromatic variety of this international dietary staple. Deva Singh Sham Singh is one of the largest exporters of Indian traditional basmati rice, holding a significant market share in over 15 countries worldwide. The company operates two state-of-theart processing plants and a modern research laboratory, with an installed capacity of milling over 12 MT per hour. Constant upgrading of equipment to reflect technological advancement has solidified their position as a leader in this field. In addition to paddy cleaning, drying, parboiling, milling, polishing

and grading machines, Buhler and Satake Sortexes for color sorting and state of the art LOMA metal detectors are part of the integrated processing lines. The finished product is then packaged on-site in a variety of consumer packaging. Company’s management philosophy is to integrate family tradition with international technical advances to ensure that DSSS continues to supply the highest quality products to the consumers worldwide. Besides being certified for ISO 9001-2000 and HACCP, DSSS has recently been certified for ISO 22000-2005, PAS-220-2008 by Intertek – Semko certification, Sweden and BRC, ITS testing services (UK) limited. DSSS has also started processing Organic Basmati rice after getting one of their processing facility certified for Organic processing. Under the recognized 817-Elephant brand DSSS has long supplied rice to the large Indian and Middle-Eastern ethnic markets in the United States, Canada, Australia, Europe and Middle East. DSSS has been a presence in the U.S. and Canadian markets since 1978, with the 817-Elephant trademark having been registered in these countries in 1984. Since that time DSSS has maintained an impeccable reputation for consistent quality and an unblemished record of FDA approval. Over the years it has responded to the increasing demand from mainstream consumers and now supplies basmati rice to several large Grocery and Cash & Carry chains. These include Giant, Safeway, AP and Wegmans in the United States and Loblaws, Walmart and Sobey’s in Canada. Through their distributor in Canada DSSS supplies Basmati rice to Uncle Ben’s in Houston, Texas and to EFFEM Foods (a subsidiary of Uncle Ben’s) in Ontario, Canada. The company also sells rice directly to GOYA Foods in the U.S. 817-Elephant basmati rice was also supplied to Costco Foods in Montreal, Quebec in 5kg bags from 1996-1977. Basmati rice under the DSSS

AgriBusiness & Food Industry w October 2012

Pure Basmati Rice Butterfly brand is also sold in the Canadian market; an application to register this trademark in the U.S. is currently in process. For the past ninety years Deva Singh Sham Singh has built upon its extensive experience and resources to diversify and improve its operations. Combining technological advancements with strict standards of quality has allowed them to retain the impeccable reputation of their food product while expanding to meet changing consumer demands. DSSS is dedicated to upholding its tradition of excellence and remaining the premier exporter of basmati rice worldwide. The company’s worldwide dealer network covers Australia, Austria, Bahrain, Canada, Cyprus, israel, Jordan, Kuwait, Lebanon, New Zealand, Saudi Arabia, Israel, Palestine, U.A.E., U.K. and the U.S.A. Over the years, DSSS has received numerous awards from various national bodies paying testimony to their dedication to quality, and their outstanding performance in the international market. Among the awards accorded to the company in recent years are the President of India National Award, the State Export Awards, the State Productivity Awards and the APEDA Awards. The Company has the distinction of being recognized as an Export House by the Government of India.

AgriBusiness & Food Industry w October 2012

profile

AgriBusiness & Food Industry w October 2012

profile

AgriBusiness & Food Industry w October 2012

profile

AgriBusiness & Food Industry w October 2012

profile

Sifter International

S. C. Sharma

elcome to Sifter International, a legacy of trust, reliability and honesty along with new mantra of youth, dynamism and aggressive â&#x20AC;&#x201C; a company that is committed to bringing world class agro based food processing machinery to its customers. Sifter International is a leading manufacturer of agro based food processing machinery which started in 1978 in India. With the experience of more than 3 decades and a team of more than 300 people, Sifter International is a renowned name worldwide which has successfully exported machinery in more than 40 countries like USA, Ukrain, Iran, Iraq, Syria, UAE, Balgium, Romania, Bulgaria, Nigeria, Ivory Coast, West Indies, Bangladesh, Sri Lanka, Nepal, Spain, Mozambique, Malawi, Republic of Sierraleone, Borkinofaso etc. Sifter International an ISO 9001 (Quality Control) & ISO 22000 FSMS (Food Safety Management System) Registered Firm & Group companies are equipped with state â&#x20AC;&#x201C;of the-art production plants in the heart of industrial town Faridabad, Haryana. The company is having CE certification

for supplying the machines to European countries. The company has been engaged in the manufacturing of wide variety of agro based food processing machineries like: 1. Rice Mill 2. Wheat Roller Flour Mill 3. Dal and Besan Mill 4. Dehulling of Seeds 5. Essential Oil & Oleoresin 6. Cattle Feed Machinery 7. Maize Starch, Grit Machinery 8. Guar Gum Powder Machinery 9. Spices Machinery 10. Extraction From Herbs 11. Fruit Juice Machinery 12. Tomato Processing Machinery 13. Potato Chips Machinery 14. Solvent Extraction Machinery 15. Basic Drugs From Roots Our manufacturing facilities are equipped with latest machines like CNC Laser Sheet Cutting, Bending, Punching Machine, CNC Turret Punch Press, CNC Press Brake, NC Shearing Machine, Universal Milling Machine, Dynamic and Static Balancing Machine & Grinding Machine to keep pace with changing technology and requirement. Our R&D unit of Sifter International is equipped with the state f art technology & professional from the different field of engineering. With the feedback and suggestion from the global customer sifter continuously work on improvement and innovation of technology. In sifter R&D unit various activity such as development of new technology, improvement of existing machines, development of new process technology, process optimization etc. have been carried out to meet the

AgriBusiness & Food Industry w October 2012

SIFTER INTERNATIONAL, INDIA received the World Quality Commitment Award in the Gold Category

demand of our esteem customers. At this unit demonstration of various process and machineries have been carried our from time to time. It also organizes various demonstrations on clients request. In our R&D unit w have installed complete cleaning & grading plant of any type of cereals, de-hulling machines for various seeds, different types of dries like tumbler drier, spray drier, spin flash drier, vacuum drier, scrap surface drier, three stage evaporator, fludized bed drier, ACM grinding system, dall mill, rice mill machines and degerminator & dehulling machine. At Sifter International, it has always been our endeavor to provide quality, consistency, and excellent service. Business Initiative Directions is the leading organization awarding companies worldwide. We are awarded for the WQC (World Quality Commitment) International Star Award in the Gold Category at Paris, France 2009, We received Global award for Perfection Quality and Ideal Performance at Berlin (Germany) for the year 2010. www.sifterinternational.com

AgriBusiness & Food Industry w October 2012

spices

Spices Board, CII & USFDA open training centre

he Spices Board has decided to partner with CII and USFDA to set up a collaborative training centre for food safety and supply chain management. This is to clear apprehension and concern on quality of spices and spices products exported from India. Inaugurating the collaborative training centre, A. Jayathilak, Chairman, Spices Board, said that the centre, the first of its kind in India, is the culmination of the decision taken in the aftermath of the World Spice Congress held in Pune in February this year. The collaborative training centre for food safety and supply chain management in spices/botanical ingredients is being set up to facilitate capacity building and developing product specific testing procedures in the sector of spices and botanical ingredients. Spices Board and CII – FACE (Jubilant Bhartia Food and Agriculture Centre of Excellence) is partnering with JIFSAN (The Joint Institute for Food Safety and Applied Nutrition) / USFDA (US Food and Drug Administration) in establishing the centre. The first phase of the training has commenced in Kochi on Monday being attended by over 60 officials and functionaries from 50 organisations from both the Government and non government sector consisting of processors, trader, exporters, etc. The phase two for selected delegates will be held in the US for two weeks. In phase three, participants attending phase two would be involved in a series of workshop and training programmes

Spices Board Chairman A. Jayathilak, handing over the Memorandum of Understanding on the collaborative training centre for food safety to USFDA's International Training Programme Manager James Wayne Rushing. Also seen are M.S.A Kumar, former Chairman of CII-Kerala, and Indrani Ghose, Principal Counsellor, CII FACE

in different regions of India. SUPPLY CHAIN HELP The training centre assumes importance in the context of most of the countries especially the US and EU bringing in stringent legislations regarding the standards of spices imported to respective countries. This will give producing countries like India, an edge over the other competitors on the export front. The centre would strengthen the supply chain management for both domestic and international trade through providing technical support to organisations through training, information sharing and technical consultancy to organisations selected by the Board, in the upgradation of their manufacturing, processing facilities, quality control assurance system, implementing hygiene and food safety management system, etc. Various stakeholders in the supply chain will be provided with training, counselling, consultancy, etc to build up their capabilities and enable them to be globally competitive. n

AgriBusiness & Food Industry w October 2012

Corrigendum In the Cover Story of Agri Business & Food Industry (August & September 2012 combined Issue), we carried a news story under the caption, ‘Spices Board India proposes Codex Standards’. It had said, “Acting on a note submitted by India, Codex has set up a committee on Indian spices to formulate the standards.” Now we understand that the committee has not yet been set up. Therefore the paragraph should read: “Acting on a note submitted by India, the Codex Alimentarius is considering setting up a Codex Committee on Spices, Aromatic Herbs and their Formulations. A final decision will be taken by the Commission at its next session in July 2013.” – Editor

AgriBusiness & Food Industry w October 2012

pre-eventreport

Rice & grains to be focus points in upcoming show

SIAL

Middle East, the region’s fastest growing professional trade exhibition for the food, drink and hospitality industry, is gearing up for its busiest edition yet, with two new complementary partnership exhibitions joining the global brand under the same roof at the three-day event, which will be held at Abu Dhabi National Exhibition centre (ADNEC) from 26-28 November, 2012. New for this year is the integration of Rice & Grains into the SIAL Middle East schedule. Relocating from Dubai to Abu Dhabi as part of its future growth strategy, the cereals exhibition - now in its second year – is making the move in response to increased interest in the event from international markets as the region faces ongoing challenges in securing new food supplies as one of the world’s largest basic commodities importers. “Abu Dhabi is one of the largest purchasers of rice in the UAE as a direct result of its food subsidies programme for the people of the emirate. The integration of rice and grains into SIAL Middle East complements the other offerings at the event and, with Abu Dhabi a major business hub for the region, exhibitors will benefit considerably from participation,” said Mohamed Jalal Al Reyaysa, Chairman of the Organizing Committee for SIAL Middle East and official spokesperson for Abu Dhabi Food Control Authority (ADFCA).

The GCC imports 90% of its food requirements and is entirely dependent on external markets to satisfy consumer demand for maize, rice and barley. According to an Alpen Capital report, cereals accounted for 43.7% of total consumption in 2011 and, with a population growing at three times the global average, food imports are expected to double to US$53.1 billion by 2020. “The obvious synergies between the two exhibitions have allowed us to take the event to a logical next level, by creating a multi-stage platform that encapsulates the ‘farm to food’ cycle of the industry. This is a powerful vehicle which brings all the major local, regional and international players together to discuss demand drivers and current trends, and drive growth and innovation across the board,” says Chris Fountain, Managing Director of Turret Media, organisers of SIAL Middle East. Rice & Grains will occupy Hall 6 at the November event, with over 150 industry heavyweights heading to the UAE capital to do business with the more than 10,000 professional food buyers expected to attend. “The MENA region attracts the majority of exports from the world’s major rice producers, as they look to expand their global reach and capitalise on market demand. Here in the Emirates, we have a well-established trading hub, a structured shipping infrastructure, ample storage facilities and a trade-friendly environment, among other things,” said Mohammad Harfouch, Executive Director at Ideal Idea Events, organisers

AgriBusiness & Food Industry w October 2012

of Rice & Grains.” “And with the advent of new worldclass facilities like the new Khalifa Port and the emerging Khalifa Industrial Zone Abu Dhabi (KIZAD), the UAE has the potential to cement its status as a launch pad for growth into new and existing regional markets with high value potential,” he added. Held in strategic partnership with the Abu Dhabi Food Control Authority (ADFCA), food importation trends and price hikes of various food staples are set to be a hot topic on the exhibition floor and various conference sessions. Earlier this year, UAE President, HH Sheikh Khalifa bin Zayed Al Nahyan, issued a directive to extend the Ramadan food subsidies for nationals until the end of the year. The list of subsidised essential food products supported by government funding now includes rice, flour and pasta and is valued at a total of US$1.9 million. SIAL Middle East has grown rapidly since its inaugural edition in 2010, and in 2011 welcomed 466 exhibitors from 43 countries, and 9,707 visitors, representing a 55% and 34% increase on 2010 figures, respectively. In addition to Rice & Grains, SIAL Middle East will also incorporate a new event as part of a co-location agreement with the International Travel Catering Association (ITCA), as well as hosting the Emirates International Date Palm Festival. The quartet of exhibitions will welcome more than 1,000 international exhibitors including 30 national pavilions from Argentina to Vietnam. n

AgriBusiness & Food Industry w October 2012

agriaffairs

Cold Chain Development Gathers Pace — Sanjeev Chopra

ccelerated Cold Chain Development to mitigate food inflation was the theme of the fourth Cold Chain Summit, organized by the Confederation of Indian Industry (CII), on August 2930 in New Delhi, with support from the Ministries of Agriculture and Food processing Industries. I was present through most of the sessions, and also delivered the Valedictory address. In the inaugural session itself, Union Agriculture Secretary Ashish Bahuguna sounded a note of caution on the optimistic projections of the industry, which felt that with the exemption of perishables from the purview of the APMC Act, there would be a flurry of investments in the cold chain sector, thereby leading to the transformation of the sector on account of several new players moving in with investments and technology. He felt that unless state governments actually saw the benefit of taking out perishables from the ambit of the Act, there was every likelihood of states backtracking on reform. He said one had to take into account several other factors, including technology, power supply, ease of transactions and the existing trade practices as well. In his inaugural address Planning Commission member Dr Saumitra Chaudhri shared the highlights of the report on Cold Chain infrastructure for perishables and High Value Agriculture. He said the problems faced by the sector

were indeed complex, and were not amenable to a silver bullet as the panacea to all the ills in the sector. The report had acknowledged the fact that intermediaries could not be wished away by legislative intent or administrative fiat. They had to be regarded as ‘economic agents’, and efforts need to be made to convert them from being rent seekers to entrepreneurs. State governments had an important role to play in ensuring a transparent regulatory framework, and institutions like NHB, NHM and MoFPI should play a promotional role. I also chaired a session on the road map for National Centre for Cold Chain Development (NCCD), which had been established in the Horticulture Division of the Union Department of Agriculture &Cooperation (DAC). Participants were quite vocal on the problems faced by the sector: erratic power supply, high interest rates, delays in release of subsidy by NHB, arbitrary rent control orders by state governments, and

AgriBusiness & Food Industry w October 2012

I also chaired a session on the road map for NCCD, which had been established in the Horticulture Division of the Union Department of Agriculture &Cooperation (DAC). Participants were quite vocal on the problems faced by the sector: erratic power supply, high interest rates, delays in release of subsidy by NHB, arbitrary rent control orders by state governments, and sometimes by district administrations, harassment of cold storage owners by all and sundry (cops, labour inspectors, health authorities, and revenue and panchayat officials) sometimes by district administrations, harassment of cold storage owners by all and sundry (cops, labour inspectors, health authorities, and revenue and panchayat officials). The latest in the series was the introduction of service tax on produce stored in the cold storages, which they felt was the last straw on the camel’s back. Cold storage owners felt that this would make it extremely difficult for the ‘rental-model’ cold storages to survive, as farmers were not willing to pay the service tax over and above the rentals, and there was no way in which the burden could be borne by the cold storage owner. However the conference was not just a tale of unending woes! There was much to cheer about. After all, of the total 30 million MT of capacity, nearly half had been created in the last decade itself, and even within these ten years, the last three years had shown a marked increase in the demand for cold stores. More important than the increase in demand was the fact that

agriaffairs the new cold chains were looking at â&#x20AC;&#x2DC;price arbitrageâ&#x20AC;&#x2122; rather than standalone rentals. Integrated value chains especially in apples in Himachal Pradesh had made a positive impact on the ground, and farmerâ&#x20AC;&#x2122;s realization had gone up substantially. There was now increasing interest from several state governments to replicate the Himachal model. Interestingly, in Himachal, interventions had been made by the corporate sector (Adanis) and the public sector (FEHL, a hundred percent subsidiary of CONCOR). The second reason to cheer was willingness of the financial institutions to finance new projects in the sector, and the opening of the RIDF and ECB route for cold chain projects. The third reason was the willingness of the state governments in working with the corporate under the umbrella of the PPP IAD with liberal financial support under the Rashtriya Krishi Vikas Yojana (RKVY). Maharashtra and Gujarat had taken the lead in this

direction, and the J&K government was seeking collaboration with CONCOR to establish the value chain for apples. What does one conclude from all this. Yes, there is much that needs to be done, but what has been achieved from the time of the first summit cannot be underestimated. The spread of cold chain is moving beyond the three states of Punjab, UP and West Bengal and the new players include Gujarat, Bihar, AP, Tamil Nadu and Odhisha. Most of the new cold stores have Controlled Atmosphere, and are multi chamber: thereby making it possible to store multiple commodities. There was a marked interest in technology upgrades for the existing cold stores, and there was a willingness to invest in HRD at all levels. Logistics providers were beginning to understand the potential of this sector and put their money into the business of perishables. PSUs like the CWC, CONCOR and FEHL were second to none in leading from the front, and last but not the least,

growers associations were eager to get into long term contracts with aggregators to take this forward. All this augurs well for the cold chain, and though its ability to combat food inflation still seems to be very ambitious, the first steps have been taken in the right direction, and one does hope that over the next few months, many of the thoughts and ideas shared in the Summit will see the light of day. (The author is Joint Secretary & Mission Director, NHM & NMMI, Union Ministry of Agriculture)

AgriBusiness & Food Industry w October 2012

organicfoods

Organic Goodness

Current Sugar & Honey Scenario in US â&#x20AC;&#x201D; A.K.Singh, President & CEO, Little Bee Impex

Organic Sugar There is currently a good demand for organically certified cane sugar and other natural sweeteners in USA. This must be derived from organically grown cane sugar which is then processed without the use of synthetic chemicals. Organic raw sugar is now purchased by large food manufacturing companies in US for their own range of organic products .At the moment, organic sugar is mostly imported from Brazil, Paraguay, and many smaller countries with emerging economies. Today, all major hypermarkets and supermarkets in US have dedicated shelf for organic sweeteners. Study says that USDA is fixing up the FY 2013 refined sugar TRQ at 129,251 STRV (117,254 MTRV). Of this quantity, 106,825 STRV (96,910 MTRV) is reserved for the importation of specialty sugars as defined by the USTR. The total refined sugar TRQ includes the 24,251 STRV (22,000 MTRV) minimum to which the United States is committed under Uruguay Round Agreement on Agriculture, of which 1,825 STRV (1,656 MTRV) is reserved for specialty sugar. Progressive views are that

because the specialty sugar TRQ works on first-come, first-served basis, tranches are needed to allow for orderly marketing throughout the year. The FY 2013 specialty sugar TRQ will be opened in five tranches. The first tranche, totaling 1,825 STRV (1,656 MTRV), will open October 12, 2012. All specialty sugars are eligible for entry under this tranche. The second tranche will open on October 26, 2012 and be equal to 38,850 STRV (35,245 MTRV). The remaining tranches will each be equal to 22,050 STRV (20,003 MTRV), with the third opening on January 11, 2013; the fourth, on April 11, 2013; and the fifth, on July 11, 2013. The second, third, fourth, and fifth tranches will be reserved for organic sugar and other specialty sugars not currently produced commercially in the United States or reasonably available from domestic sources. In order to ramp up capacity, the USTR will allocate the refined TRQ, other than the amount reserved for specialty sugar, among supplying countries and customs areas. India has better chance for exporting organic sugar in US. Going the extra mile, organic sugar production is better for the environment in several ways. By avoiding synthetic fertilizers, organic plantations are less likely to increase salinity of local soils and ground water. Organic growers tend to harvest single crop from each planting before rotating their fields to another crop. This helps protect the soils from nutrient depletion. Organic Honey From a demand perspective, organic honey for table use is particularly interesting as it is easily recognized and consumed for health reasons. Yet a substantial portion of honey supplies

AgriBusiness & Food Industry w October 2012

goes directly into food manufacturing as organic ingredients where sometimes the presence of honey is not readily apparent, depending on the food product. Often the honey used as an organic ingredient is highly visible such as honey cereals, honey-coated candies or sweets, or even honey-coated peanuts. Demand for honey in these forms may be more related to the demand for the processed food where honey is just one of many ingredients or additives, whereas bottled or packaged honey is usually displayed and presented in forms where the honey is the only good or, at least, the primary product being sold. Most often in supermarkets, separate sections are allocated to just honey in various containers where the colour and texture can be seen and the flower variety labelled. There are several recognizable brands of honey as well as honey identified by country of origin. Combined, all of the varieties, brands, US IMPORT OF ORGANIC HONEY BY COUNTRY, QUANTITY, AND VALUE YEAR TO DATE COUNTRY Australia

QTY KGS

VALUE DOLLAR

CIF VALUE DOLLARS

18,408

1,56,654

8.5101043

Brazil

17,08,416 53,50,275

3.1317167

Canada

1,35,659

6,29,540

4.6406062

50,377

1,14,217

2.2672450

Greece

8,368

1,13,582

13.5733748

Italy

7,297

94,944

13.0113745

Mexico

2,42,305

7,81,278

3.2243577

New Zealand

12,597

80,163

6.3636580

Taiwan

3,150

12,390

3.9333333

Dominican Republic

Grand Total

21,86,577 73,33,043

Source of data: //www.marketnews.usda.gov//

3.3536633

organicfoods and packaging lead to an aggregate demand for honey. Likewise, all of the demands for honey as ingredients lead to the manufacturing demand for honey. Honey used for food manufacturing has accounted for between 60 percent to 80 percent of the total honey market in USA. Report says that 2012 honey crop in USA is as low as 125 million pounds. If it is so, honey prices are bound to spin upwardly. Australia, Brazil and Canada are the key exporters of organic honey to the US in 2011-2012. Brazil’s honey production continues to expand due to Brazil’s ability to produce organic honey in large of its virgin areas. Over the years, the market demand for organic honey in US has risen and resulted in premium prices. The basic criteria for organic honey are that bee hives should be placed in

Honey used for food manufacturing has accounted for between 60 percent to 80 percent of the total honey market in USA. Report says that 2012 honey output in USA is as low as 125 million pounds. If it is so, honey prices are bound to spin upwardly. a natural environment unaffected by industrial manufacturing, pollution, or agricultural chemical applications. All stake holders must ensure that it does not contain detectible levels of environmental pollutants or chemical contamination. This helps in protecting

natural enzymes, pollens and biologically active compounds which differentiate high grade honey from other natural sweeteners. Honey is great alternative to sugar and retains most of its properties unlike sugar when processed. With refined sugar, in the process of manufacturing, nitrogen elements, organic acids, enzymes and vitamins in the sugar canes are destroyed while with honey, no real processing is required. Honey is ideal liver fuel because it contains a nearly 1:1 ratio of fructose to glucose. Fructose “unlocks” the enzyme from the liver cell’s nucleus that is necessary for incorporation of glucose into glycogen. Honey has got healthier Glycemic Index [GI], which measures the negative impact of given food on the blood-glucose level.

AgriBusiness & Food Industry w October 2012

organicfoods

Food safety is the main factor behind the popularity of organic foods The concept of organic farming is basically the same ancient concept which our forefathers used to have before the coming of chemicals and inorganic substances. Now, organically produced food has begun to attract a lot of attention and there is a lot of publicity and marketing to promote organic food in India. Is this a trend and a passing phase, or is organic food here to stay? Vishal Jalan, Managing Director of Kolkata-based Aricha Trading Company in conversation with Azeem Haider, Correspondent, Agri Business & Food Industry, talks about the market dynamics of organic foods in India.

powder and in turmeric. These artificial flavorings and additives are causing nerve disorders and even birth defects. Concerned consumers are avoiding foods that are not certified or guaranteed for purity. So opting for the richer quality pure organic food is becoming more and more prevalent in India. This has been helped by passionate purveyors of organic food like our own team and our associated farmer groups.

How has the market for organic foods in India evolved over the years? In May 2007, Aricha launched its range of certified organic spices in New Delhi. We had to compete with the lower priced so-called organic products available in the stores, many of which were not genuine. So, we started educating consumers to look for products by manufacturers who guaranteed / certified the genuineness of their products. Certified organic foods are authenticated at different stages by independent certifying agencies. The market for such products is evolving fast as the Indian consumer is highly aware and is demanding products that ensure safety and health for their family. What are the factors that are driving growth of organic foods in India? Food safety is the main factor. Everyday, there are alarming reports of food adulteration ranging from cancer causing chemicals and food colours being used in red chilli

What are your distribution and supply channels? A reliable supply chain is crucial in order to build trust with retailers and consumers. We select pure farms in the deserts of Rajasthan and in the hilly forests of Orissa. These farms are far removed from the lethal grasp of pollution and contamination. This ensures pure farm produce grown in the right environment and with sustainable soil enrichment. We supply directly to retailers including hypermarkets, supermarket chains and independent organic food retailers. Inventory is made available locally in order to prevent delays due to weather and transport disruptions. Also new products are added to the range only after assuring their quality first and then their quantity. This is managed by our growing number of hawk-eyed, quality conscious field officers and our enterprising sales team which is present across the country. How proactive is the Indian government in promoting organic food in India? The Indian Spices Board and APEDA are taking a number of initiatives under the Ministry of Commerce schemes for

AgriBusiness & Food Industry w October 2012

Export Market Development of organic foods. Joint co-exhibition at international trade fairs at nominal costs has been instrumental in giving us a platform to attract international buyers. Certain state governments like Rajasthan, Bihar, Sikkim and Uttarakhand have taken steps to educate farmers on scientfic processes and inputs involved in organic farming. What are the challenges faced by retailers and manufacturers of organic foods? The biggest challenge is ensuring the supply chain - quantity and quality. Quantity can be arranged relatively quickly by converting more farmlands to organic farming. It takes about three years for a farm to get certified as organic, as all chemical residues in the soil have to be eliminated. Quality can be developed only by patience and perseverance over a much longer period. We are mainly exporting to the most stringent markets of Japan and this has helped us to learn and adopt increasingly robust food traceability systems and we are investing in the highest quality of manpower across all levels. What are your future plans? The growing awareness of where and how our food is produced is transforming food from being looked at as a commodity to being understood as the key to health. â&#x20AC;&#x2DC;Let food be thy medicine and not medicine be thy foodâ&#x20AC;&#x2122;. This is why we invest in richer talent, richer quality control and only select the richer soils of pure organic farms. We are reaching out to new markets from Orissa to Osaka and ensuring that the informed consumer is able to get a richer taste of India. This is Arichaâ&#x20AC;&#x2122;s mission.

AgriBusiness & Food Industry w October 2012

pre-eventshow

Boosting New

Wave Of

Japanese Food Business in Asia

iding on Asia’s growth potential and the success of preview show ‘Ganbarou Nippon: Taste of Japan 2011’, Oishii Japan is staged as an answer to the insatiable appetite for authentic Japanese food and beverages. To be held from 1 to 3 November at Sands Expo and Convention Centre, Marina Bay Sands Singapore,

Oishii Japan is an all-encompassing F&B show that provides a one-stop sourcing platform for F&B professionals,chefs, restaurateurs, hoteliers, importers and distributors, retailers as well as new business owners and investors in the food business. Occupying approximately 4,000 square metres, Oishii Japan will feature some 200 exhibitors from more than 20

AgriBusiness & Food Industry w October 2012

prefectures in Japan to showcase a bevy of specialty food items and new-tomarket products – some of which are not commercially available in stores. The trade show runs the gamut from popular Japanese soba, ramen and udon noodles, fresh and processed meat and poultry, seafood, sauces and condiments, confectionary and snacks, alcoholic beverages such as sake, sochu and beer to exquisite cutlery and tableware, and includes innovative food machinery. Exhibitors who will be promoting their products in Singapore and Asia for the first time including Sakai City Food and Kitchenware, highly recognised for its history of outstanding knife-forging skills dating back to the 5th century; and Naomoto Corporation, manufacturer of state-of-art steam oven that takes a mere 20 seconds to defrost and cook frozen foods to perfection. During the three-day show, visitors cansample an extensive range of awardwinning products including fruit juices from Marukai Corporation, recipient of the prestigious 2012 Monde Selection Gold and Silvers Awards; and sake brewed by Ikekame Shuzo, one of Japan’s oldest brewery to win the gold prize in 2012 Annual Japan Sake Awards. Oishii Japan will also feature a myriad of well-known food specialities from various parts of Japan including Okinawa Prefecture’s awamori, indigenous distilled rice liquor that is gradually gaining popularity with connoisseurs; Gifu Prefecture’s Hida beef; Kagoshima Prefecture’s black cattle beef and Kurobuta black pork; Hokkaido Prefecture’s scallops and confectionaries; Niigata Prefecture’s sakeas well as Chiba Prefecture’s rice, vegetables and fruits. A series of highlights will also be organised to sharpen the business networking and educational experiences of participants. These include interactive food demonstrations, tastings, business matching and workshops. n www.oishii-world.com

AgriBusiness & Food Industry w October 2012

dairy

Agflation to hit animal protein & dairy industries: Rabobank Report

kyrocketing agricultural commodity prices are forcing the world to re-enter a period of "agflation", with food prices forecast to reach record highs in 2013 and to continue to rise well into Q3, 2013. Unlike the staple grain shortage in 2008, this year's scarcity will affect feed intensive crops with serious repercussions for the animal protein and dairy industries. Luke Chandler Global Head of Agri Commodity Markets Research at Rabobank commented, “The impact on the poorest consumers should be reduced this time around, as purchasers are able to switch consumption from animal protein back towards staple grains like rice and wheat. These commodities are currently 30% cheaper than their 2008 peaks. Nonetheless, price rises are likely to stall the long-term trend towards higher protein diets in Asia, the Middle East and North Africa. In developed economies – especially the US and Europe – where meat and corn price elasticity is low, the knockon effect of high grain prices will be felt for some time to come.” Due to the long production cycles of the animal protein and dairy industries, the affects of grains shortages will be more sustained as herds (especially cattle) take longer to rebuild, maintaining upward pressure on food prices. However,

Mark your dates

India's Largest Exhibition on Dairy Products, Processing & Packaging Machineries and Allied Industries

food makes up a smaller proportion of budget spend in such countries, so the current period of agflation should not lead to the unrest witnessed in response to the shortage in 2008. Rabobank estimates that the Food and Agricultural Organisation (FAO) Food Price Index will rise by 15% by the end of June 2013. In order for demand rationing to take place, in turn encouraging a supply response, prices will need to stay high. As such Rabobank expects prices – particularly for grains and oilseeds – to remain at elevated levels for at least the next 12 months. Government Intervention Whilst the impact of higher food prices should be reduced by favorable macroeconomic fundamentals (low growth, lower oil prices, weak consumer confidence and a depreciated US dollar); interventionist government policies could exacerbate the issue.

23-24-25, August 2013 Bangalore, India

3rd Edition

www.dairytechindia.in

AgriBusiness & Food Industry w October 2012

Stockpiling and export bans are a distinct possibility in 2012/13 as governments seek to protect domestic consumers from increasing food prices. Increased government intervention will likely encourage further increases in world commodity and food prices. Rabobank expects that localised efforts to increase stockpiles will prove counterproductive at the global level, with those countries least able to pay higher prices likely to see greater moves in domestic food price inflation. This is a vicious circle, with governments committing to domestic stockpiling and other interventionist measures earlier than usual—recognising the risk of being left out as exportable stocks decline further. On top of that, Rabobank warns that global food stocks have not been replenished since 2008, leaving the market without any buffer to adverse growing conditions. Efforts by governments to rebuild stocks are likely to add to food prices and take supplies off the market at a time when they are most needed. Current price inflation is the result of weather driven events in large exporting nations, principally a severe drought in the US (its worst since 1936) and similar water shortages in Russia and South America. This rally in grain and oilseed prices will have a significant knockon effect on other F&A supply chains especially the animal protein industry, resulting in rising meat prices. n

AgriBusiness & Food Industry w October 2012

agriexports

India’s agri-food exports register 90% growth

APEDA Wants Nothing Less Than Spectacular GROWTH: Asit Tripathy APEDA’s export products have shown an impressive growth rate . . . a remarkable 97.35 per cent increase in rupee terms and a whopping 87.46 per cent rise in dollar terms over the previous year 2010-11. Positive growth has been registered in each segment.

griculture and Processed Food Products Export Development Authority (APEDA) has been the main instrument in catapulting India’s food products exports to respectable heights for years, at the same time, remaining powerful as a strict watchdog of quality and safety. Under its current Chairman Asit Tripathy’s visionary guidance, APEDA appears more than active to strengthen further this status of India as one of the top agri-food products exporters in the world. According to Tripathy, at a total of Rs. 82,480.25 crores, it is almost a 90 per cent growth over the previous year. “Uniquely, India became for the first time the largest rice exporter in

the world overtaking Thailand.” Now, he added, almost all the commodities are open to exporters and restrictions such as MEP, export tax, etc have been lifted. “The aim of APEDA is clear—to establish India as a reliable exporter of quality food products to the world,” he said. APEDA Exports: Delivering Growth APEDA’s export products have shown an impressive growth rate. The Directorate General of Commercial Intelligence and Statistics (DGCIS) provisional export data for the 2011-12 reveals a staggering rise in APEDA’s exports. The products have registered a remarkable 97.35 per cent increase in rupee terms and a whopping 87.46 per cent rise in dollar terms over the

AgriBusiness & Food Industry w October 2012

previous year 2010-11. As against an overall export of Rs. 41,794 crores in 2010-11, the figure has reached Rs. 82,480 crore during 2011-12. Overall export growth of APEDA products Positive growth has been registered in each segment. While floriculture and seeds registered a growth of 35.15 per cent in rupee terms, fresh fruits and vegetables showed a growth of 14.85 per cent. A 41.57 per cent growth was achieved in processed fruits and vegetables. While livestock products grew by 49.67 per cent. Other processed foods accounted for 213.02 per cent growth while cereals registered centenary mark at 100.99 per cent.

AGRIEXPORTS Government measures such as allowing export of non-basmati rice and wheat have also led to this growth in exports. These numbers once again highlight the positive role being played by APEDA. Cereals: the Grain Export Potential Agriculture forms the core of Indian economy. The country holds the second position in agricultural production in the world. There is a huge demand for Indian cereals in global markets. In 2011-12, the production of major cereals rice, wheat, maize and bajra stood at 104.32 million tonnes, 93.90 million tonnes, 21.57 million tonnes, and 10.06 million tonnes respectively, according to APEDA’s APEX Update Journal. Rice Rice is second most popular cereal in the world, consumed by 2.7 billion mouths. There are around 4000 different varieties of rice in India. Last fiscal, rice occupied the major share of about 55 per cent in India’s total cereal exports. India is the largest producer, consumer and exporter of Basmati rice in the world. Hundreds of countries import it from India. As per APEDA data, India’s export for Basmati rice stood at Rs. 15,450 Crore during 2011-12. APEDA has identified aromatic shortgrain rice varieties such as kalanamak, tilakchandan, jeerabati, kalajeera, ambemohar, and kala joha, which could be harnessed and developed for export. According to it, “In small and medium grain aromatic rice, there is still a great scope for improvement by selecting short stature, better yielding and early maturing plant type”. Wheat India is the second largest wheat producer in the world. In India, wheat accounts for more than 30 per cent of total foodgrain production. 40 per cent of global arable land is used for wheat cultivation. Numerous varieties of wheat are exported from India to countries like France, Singapore, UAE, and Australia. As per DGCIS annual export data for 2010-11, India’s export of wheat stood at Rs. 59.68 lakhs.

Maize Maize is the third most significant crop in India and is cultivated on about 8.12 million hectares. While globally, it is cultivated in 160 countries with a combined arable land of around 150 million hectares. Presently, India ranks among the top 10 maize producing countries. Maize is largely exported to Bangladesh, Malaysia, Vietnam, Indonesia and UAE. It is also used as animal feed, and for industrial purposes.

import huge quantities from India.

Millet Bajra or pearl millet is among the oldest known cereals in the world. India is No. 1 bajra producer in the world with an annual planting area of 10 million hectares, producing nearly 7.5 million tonnes. India exports bajra to many countries like Sudan, Pakistan, UAE, Yemen and Vietnam. Ragi or finger millet is also exported to Nepal, Sri Lanka, Pakistan and UAE.

Oats Oats is grown in 5 lakh hectares of and in India, and is also used for medicinal purposes. The multifaceted grain is exported to UAE, Sri Lanka and Nigeria.

Barley Barley is grown on 0.63 million hectares with a production of 1.20 million tonnes. There has been a steady fall in the area and production of this crop since the beginning of the green revolution. UAE, Bhutan, Oman, Bahrain and Nepal

Sorghum After wheat, Sorghum (Jowar) occupies the largest are allotted for cultivation in India. This cereal is also used to make starch and ethanol, apart from being used in the manufacture of adhesives and paper. India is 7th largest producer of Sorghum in the world. It is also an important animal feed.

Rye Rye belongs to wheat family and is grown extensively as a grain and as a forage crop. Like barley, it is also used as human food and animal feed. It is used to make breads, beer and other alcoholic drinks. Rye flour is exported to New Zealand, Saudi Arabia, Nepal and Norway. According to APEDA, other than wheat and rice, the overall exports of the cereals were reported to be worth

AgriBusiness & Food Industry w October 2012

agriexports of Rs. 5,479 crore during 2011-12. APEDA believes that India has every reason to become the world’s largest producer and exporter of cereals in the world. It’s a position that beckons Brand India. Other APEDA Developments Under APEDA’s guide, India and Australia have partnered for mango exports to Australia. The Australian exerts visited irradiation facility in Nasik and the hot water dip treatment in Lucknow and Saharanpur. Post this, Australia allowed mango imports from India. The visit to Lasalgao (Nasik) was coordinated by APEDA personnel. The tour paved the way for exporting mangoes to Australia this year.

part in International Horticulture Innovation and Training Centreconducted workshop, joining SATNET Asia, the innovative network for food security and poverty reduction, taking part in local as well as international exhibitions, commissioning a study to the Indian Institute of packaging (IIP) to improve Indian food packaging, participated in national workshop on floriculture exports, promoting pomegranate cultivation by taking part in a workshop in Bhopal, and attending National Seminar on Horticulture, and enhancing groundnut production by taking part in ‘Production of Aflatoxin-free Groundnuts’ workshop in Junagarh.

Apart from this, APEDA has succeeded in coming closer to opening of the New Zealand market for Indian mangoes. An expert from New Zealand visited India and carried out an audit at hot water dip facility in Lucknow and Saharanpur. The visit was coordinated by APEDA. Following this, an agreement was signed between two countries paving the way for the export of Indian mangoes to New Zealand. APEDA’s other recent exportboosting activities include holding workshops in various rice-producing states on Basmati rice to improve quality, coordinating Egypt delegation’s visit to integrated abattoirs-cummeat processing plants, expanding horticulture cultivation through taking

COMPARATIVE STATEMENT FOR EXPORT OF AGRI AND PROCESSED FOOD PRODUCTS April - July 2012 VIS-A-VIS PREVIOUS YEAR PRODUCTS

April - July 2011

Unit value

April - July 2012

Unit value

% Change

QTY VALUE (In Rs. Lakhs QTY VALUE (In Rs. Lakhs Rs. In MTs Rs. Lakhs USD Million Per Tonnes) In MTs Rs. Lakhs USD Million Per Tonnes) SCHEDULE PRODUCTS A. FLORICULTURE 11835.79 26.52 13806.94 25.32 16.65 B. FRUIT & VEGETABLE SEEDS 3948.20 9110.19 20.41 2.31 5857.48 13985.41 25.57 2.39 53.51 FLORICULTURE & SEEDS 20945.98 47.28 27792.35 53.65 32.69 A. FRESH FRUITS 68005.27 152.36 113066.06 209.69 66.26 B. FRESH VEGETABLES 76795.68 171.99 77861.45 143.20 1.39 FRUITS & VEGETABLES 144800.95 326.86 190927.51 368.59 31.86 A. PULSES 101693.00 56413.67 126.37 1.80 48090.00 31790.61 58.47 0.66 -43.65 B. PROCESSED FRUITS & JUICES 41051.13 92.05 61758.98 113.30 50.44 C. PROCESSED VEGETABLES 35230.07 78.94 36912.41 67.84 4.78 PROCESSED FRUITS &VEGETABLE 132694.87 299.54 130462.00 251.86 -1.68 A. DAIRY PRODUCTS 25148.30 56.44 31368.54 57.81 24.73 B. POULTRY PRODUCT 8731.69 19.57 12326.89 22.75 41.17 C. MEAT AND ITS PRODUCTS 347433.13 778.54 509018.23 934.69 46.51 LIVESTOCK PRODUCTS 381313.12 860.75 552713.66 1067.01 44.95 A. GROUNDNUTS 312274.00 196353.49 440.11 0.63 276612.00 203910.46 375.60 0.74 3.85 B. GUARGUM 191999.00 219922.52 492.44 1.15 233360.00 1813144.51 3341.33 7.77 724.45 C. SPIRIT AND BEVERAGES 39027.61 87.42 58780.86 107.88 50.61 D. MISC. PROCESSED ITEMS 109615.99 245.48 163075.95 299.33 48.77 OTHER PROCESSED FOODS 564919.61 1275.21 2238911.78 4322.22 296.32 A BASMATI RICE 992173.00 488630.44 1094.83 0.49 1248464.00 626717.28 1147.39 0.50 28.26 B. NON-BASMATI RICE 112740.00 37043.90 82.93 0.33 2072153.00 435477.54 794.80 0.21 1075.57 C. WHEAT 3041.00 487.72 1.10 0.16 1003948.00 137712.22 250.13 0.14 28135.92 D. OTHER CEREALS 1167417.00 154308.77 345.28 0.13 1655687.00 228066.26 419.93 0.14 47.80 CEREALS 680470.83 1536.05 1427973.30 2756.71 109.85 TOTAL 1925145.36 4345.70 4568780.60 8820.04 137.32 Source : DGCIS Principal commodities data April - July 2012(Provisonal)

AgriBusiness & Food Industry w October 2012

USD

-4.52 25.28 13.47 37.63 -16.74 12.76 -53.73 23.09 -14.06 -15.92 2.43 16.25 20.06 23.96 -14.66 578.53 23.40 21.94 238.94 4.80 858.40 22639.09 21.62 79.47 102.96

List of Participants at the APEDA Pavilion in SIAL 2012 APEDA Mr. Sunil Kumar, Secretary Mr. U.K. Vats, DGM 3rd Floor, NCUI Building, 3, Siri Institutional Area, August Kranti Marg, New Delhi-110016 (India) E-mail: secy@apeda.gov.in Web.: www.apeda.gov.in M/s. Shah Nanji Nagsi Exports Pvt. Ltd. Ms. Snehal Post Box No. 311, Anaj Bazar, Itwari, Nagpur - 440002, INDIA Tel: 0712-2732854 / 2779261 Fax: 0712-2762729 Mob. 09373593225 E-mail: nanji_ngp@hotmail.com Processed cereals, Misc. products M/s. Elmac Foods Mr. Vinod Thacker Vill-Mansadanga, N.H.- 6, Nibra, Howrah, West Bengal-711403 Tel: 033-26538045/46/47 Fax: 033-26535147, Mob: 09830030787 E-mail: elmac@vsnl.com Pickles & Chutneys, Condiments,Snacks M/s. World Dehydrates Foods & Spices Mr. Jaysukh Senta National High Wasy No. 8-E, Opp. Ganesh Temple, Ratol Road, Mahuva, Distt. Bhavnagar, Gujarat-364290 Mob. +91 9925010412 E-mail: info@worlddehydrates.com Dehydrated Onions & Garlic M/s. Khedut Feeds & Foods Pvt. Ltd. Mr. Tusar Thumar, Director Taluka Sangh Gundala Road, Gondal, Distt. Rajkot, Gujarat-360311 Tel: +91-2825- 222191, Fax: 02825222190 Mob: +91-9824329294 E-mail:info@khedut.in / kfafpl@gmail.com Groundnuts and Groundnut products M/s. Vishnukumar Traders Pvt. Ltd. Mr. P. Vishnukumar 112 B, P.H. Road, Veleppanchavadi Chennai-600077 Tel: +91-44-65715715/716/717 Fax: +91-44-26801825 E-mail: vktpl@vsnl.net Rice and Cereals

M/s. Jadli Foods (India) Pvt. Ltd. Mr. R.N. Jadli, Director 219, R.G. Complex-II, Plot No. 5, Sector14, Rohini, Delhi-110085 Tel: +91-11-27555460/2755561 Fax: +91-11-27555462 Mob: 9810124063 E-mail: info@jadlifoods.net M/s. Bagora Dehyderates / Aims Agro Products Pvt. Ltd. Mr. Sagar Jasani 216 J.P. Towers, 2nd Floor, Tagore Road, Rajkot -360002. Gujarat Tel: +91-2827-270405 / 270475 Mob.: +91 99798 50566 E-mail: export@bagoradehydrates.com Dehydrated Vegetables M/s. Capital Foods Ltd. Mr. Jivesh Bajaj Villa Capital, Sadhana Compound, Oshiwara Bridge, S.V. Road Jogeshwari (W) Mumbai-400102 Mob. +91-9619993420 E-mail: jivesh@capitalfoods.co.in Processed & dehydrated Fruits and Vegetables, RTE M/s. G.S.Exports Mr. Rahul Jain Plot No: C-167, MIDC TTC Industrial Area, Pawane, Near Hyco Bus Stop, Navi Mumbai - 400703 Tel: +91 22 27689211 / 12 Fax: +91 22 27682393 / 27619851 E-mail: info@sdsons.com Processed food products M/s. Vibrant Dehydro Foods Pvt. Ltd. Mr. Hamid Mob: +91-9820076174 E-mail: info@vibrantfoods.net Dehydrated Vegetables Natural Resources Ltd. Mr. Rajiv Jain, Vice President Best House, B-85, Okhla Phase II New Delhi, India-110020 Tel: +91-11-26387421-28, Fax: 26387429 Mob.: 9560900485/ 8826964777 E-mail: rajiv_jain@bnrl.in Organic Rice M/s. Chhatariya Veg Expo Pvt Ltd Mr. Murtuza Chhatariya Udyognagar Road, Behind H.P. Petrol Pump, Umaniyavadar, Mahuva - 364290 Gujarat - INDIA Tel: 0091 2844 246551 / 246552

Fax: 0091 2844 246553 Email: info@chhatariyaveg.com Dehydrated vegetable M/s Morarka Organic Foods Pvt Ltd Vatika Road,Tank Road, Jaipur -302022 Rajasthan, Tel: 0091 0141-2770031 Email info@morarkamail.com Web.: www.morarkaorganic.com Organic Cereals & food products M/s. Navkar Processors Mr. Pravin Choudhary, Proprietor Plot No. 239, Old Bagadganj, Small Factory Area, Nagpur, Maharashtra-440008 Tel: 0712-2778824 Fax: 0712-2721555 E-mail: info@nakodas.com Processed Food products M/s. Holista Tranzworld Ltd. Ms. Geethikha / Sahana Nirranjan 4th Floor, 6/18, Casa Major Road, Egmore, Chennai-600008 Mob: 08939813277 / 08939813269 Tel: 044-28191563/28191209 Fax: 044-28194456 E-mail: agrocommodity@holista.in Processed food Products Ecovinal International Plot no 82-90 KIADB Industrial Area Kunigal 572130, Tel +91-8132292464 H/P:+91 98453-38538. BB PIN 2113C414. SKYPE:POONACHA65. E-mail: ecovinal@vsnl.net Web.: www.ecovinalinternational.com Processed Food Products M/S ADMRK Group International SDN. BHD Ms Anju Puri Mob: +91989971509/+919769200930 Malaysia : +603-62112646 , Fax +603-62112646 ADMRK INTERNATIONAL LTD D - 406 NPSC Cooperative Group Housing Society Plot-5, Sector -2 Dwarka Phase-1, New Delhi 110075 INDIA Email: admrk.grp@gmail.com Mr. R.K. Puri +60162646956 Ms. Anju Puri +60169560954 Cereals & Cereal Products M/s Capital Dehydration Mr. M.A. Vakil Gir gadhada Road, Survey No. 261, Una - 362 560. Dist. Junagadh, Gujarat / India

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Mobile: +91-9825836050 Phone/Fax: +91-2875-224500 Web: www.capitaldehydration.com Email: info@capitaldehydration.com Processed & dehydrated Vegetables M/s Daksh Foods Pvt Ltd Dilip Patel B-32, A.P.M.C., Chitra, Bhavnagar, Gujarat Tel +91-278-2445178, Fax 02782447341 Cell : + 91 9898 5080 79 Email : info@dakshfoods.com dcpatel@dakshfoods.com Web : www.dakshfoods.com Dehydrated Vegetables

Grover vineyards Anand Bhavan 348, Dr. D. N. Road Mumbai 400 001 Tel: +91 22 2204 3885 Fax : + 91 22 2287 4021 Email: head_office@hei.co.in Wines Shakti Bhog Foods Ltd Mr. Ashvinder Kalra 403-405 Krishna Apra Business Square, Netaji Subhash Place, New DelhI-110034 Tel: 47525252, Fax: 47055499 Mobile: 9999611929 Email:- ashvinderkalra@shaktibhog.com Rice

M/s. Saaz Foods Mr. Abbasbhai 52, “Hakimvilla” Safiee Society Tamboli Nal, Near Mali Ni Vadi, Mahuva – 364 290, Distt. Bhavnagar Gujarat, Mob.- 9924632927 Email- saazfood@gmail.com Rice and other processed Foods

Sarveshwar Overseas Mr. Rohit Gupta Sarveshwar Sales Centre, Below Gumat, Jammu – Tawi (J&K) –180001 Tel.: 0191 –2481954 0191-2480292 / 2483941 Mob.: 09419333000 Email: info@sarveshwarrice.com Rice

M/s. Samad Agro Food Mr. Amit Jha 3764/65, Parmanand Street, Darya Ganj, New Delhi-110 002. Tel : +91-11-23251751/52/53 Fax : 011-23251706/23251506 Mob. : 09871790415 E-mail : sales@agro-factory.com Rice and Other Cereals

Aroma Agrotech Pvt. Ltd Mr Anil Kumar Garg S145, New Grain Market, Gharaunda (Karnal) Haryana Tel.: 91-1748- 252139 / 252339 Fax: 91 – 1748 – 253639 Mob. : 09813080451 Email: aromaagro@yahoo.com Rice

M/s. Little Bee Impex Ms. Meenakshi Sharma Village : Mallipur, G.T. Road, Doraha, Distt : Ludhiana-141421 Punjab Tel : 01628-258240/258640 Fax : 01628-258140/259570 E-mail: info@littlebeeimpex.com Honey & Processed Food Products

Whitefields International Pvt. Ltd Mr. Sumeet Saluja 1107-1108, 11th Floor, Dlf Tower B, Jasola, New DelhI - 110025, Tel.: +91 11 47599999 Fax: 91 11 41662967, Mobile: 98107 80418 Email:sumeet@whitefieldsinternational.in / ritika@whitefields.in Rice

M/s. BNK Corporation Mr. Bindesh C 257/1, TTC Industrial Area MIDC., Pawane, Navi Mumbai - 400703 Tel: + 91 22 2763667, + 91 22 27636567 Mob.: +91 9821432443 E-mail : bindesh@shahmail.in Processed Food Items, Snacks

Basic India Ltd Mr. Athar Zia 1103, Nirmal Tower, 26, Barakhamba Road, Connaught Place, New Delhi – 110001 Tel.: 43178600 - 699, Fax: 43178668 Mobile: 98100 58415 Email:basicindia@basicindialtd.com / athar@basicindialtd.com Rice

Nirvana Biosys Pvt Ltd. D.K.Gupta B-140, DDA Shed Ist Floor, Okhla Phase -1, New Delhi-110020 Tel: 011-46573940 Fax : 011-46573940 E-mail ashish@nirvanabiosys.com Web : www.nirvanabiosys.com Wines

New Bharat Rice Mills Mr Sanjiv Khosla 2612/13, 3rd Floor, Punjab & Sind Bank Building, Naya Bazar, Delhi – 110006 Tel.: 91-23924438, 23924476 Fax: 91-11-23924263 Email: mails@tajmahalrice.com / delhi@tajmahalrice.com Rice

AgriBusiness & Food Industry w October 2012

Amar Singh Chawalwala Mr Arvinder Pal Singh Chattiwind Gate, Amritsar - 143 006 Punjab Tel.: 91-183-2482121-- 24 Fax: 91-183-2482125 / 26 Mob.: 09810051246 Email:lalqilla@lalqilla-rice.com / lalqillarice@gmail.com Rice Trimax International Mr. V. K. Manchanda 278, Rajdhani Enclave, Britannia Rani Bagh Road, Pitampura, Delhi – 110034 (India), Tel.: 47999841 (3 lines) Fax: 27196611, Mob.: 98101 49841 Email: info@oasisrice.com / oasisrice@rediffmail.com Rice Sunstar Overseas Limited Mr Rakesh Aggarwal 24-B, Main Alipur Road, Near Flagstaff Road, Opp. Old Secretariat,Civil Lines, Delhi– 110 054 Tel.: 23994383-89, Fax: 23994326 Mob.: 98114 25022 Email: rakesh@sunstarmail.com / yogesh@sunstarmail.com Rice Best Foods Limited Mr. M P Jindal Unit No.502, Building D'mall, Plot No. A-1, Wazirpur, District Center, Netaji Subhash Palace, Pitampura,New Delhi110034 Tel.: +91-11- 49294929, Fax: +91-11-41540246 Mob.: 097298 70001 Email:mpjindal@bestfoodgroup.com / aayushman.gupta@bestfoodgroup.com Rice AL – GYAS EXPORTS PVT LTD Mr. Naneem Ilyas World Trade Centre, 1704 Centre – 1, Cuffe Parade Mumbai – 400 005 Tel.: 91-22-22151289 – 94 Fax: 91 – 22 – 22151200 Mob.: 09821450874 Email: age@vsnl.com Rice All India Rice Exporters Association Mr. Rajen Sundaresan 81/2, Adchini, Sri Aurobindo Marg, New Delhi - 110017 Tel.: 91-11-41071555, Fax: 91-11-41070555, Mob.: 9899898324 Email: airea.delhi@gmail.com Rice

Interview

Exploring new markets of South East Asian and African Countries: APS Manchanda, MD

Amar Singh Chawal Wala - Mfrs.& Exporters of Lal Qilla Basmati Rice. He share his views in an interview with Naveen Grover, Excerpts: Please tell us about overall scenario of global Basmati trade, India’s position in the international markets, and your own company’s status? Competitive prices of Indian Basmati Rice of 2011 crop helped to increase basmati exports to a level of 3.5 million tons. Indian Basmati qualities remained the most competitive against rice qualities produced in other countries which helped the Indian Basmati Rice to penetrate even in markets where basmati was hardly available like South East Asia and African countries. Although global market has become widened but industry margins have got shrunk due to excess production. We, Amar Singh Chawal Wala, also explored many new markets for basmati rice such as Mauritania, Djibouti, Kenya, Nigeria, Indonesia, Philippines and Malaysia etc. Recession in Europe is hurting Indian basmati exports, but at the same time, the demands at other international regions are high as well. Do you think due to this, this recession has negligible impact on Indian basmati exporters? Of course, recession in Europe had an effect on basmati rice exports and resulted in shifting of majority of demand from premium qualities to regular qualities of basmati. Another major impact came from the US market; a premium market for more than 100 thousand tons where technical barriers relating to pesticides residues have been created for Indian Basmati. Overall export is not highly affected as demand from other countries like Iran, Iraq and Yemen has much increased, resulting in hike in total Indian basmati rice exports. Gulf market is a major destination of Indian basmati. But now India is facing tough competition from Pakistan? What are your views on this? Middle East is a big market for Indian basmati rice but competition from Pakistan and surplus supplies from India resulted in shrinking margins in these countries. Weakening of Pakistani currency against US Dollar has also helped Pakistan to reduce their prices against Indian Basmati. Although the competition has become

tough yet customers prefer Indian Basmati, being better in quality and don’t mind paying premium.Government support by reducing taxation on basmati, sustainable and high-end quality can help India to maintain its edge in Middle East countries. Iraq has been a traditional buyer of India’s basmati, but according to a news story, recent US political pressure is forcing Iraqi importers to buy US long-grain rice instead of Indian basmati. Is it a matter of concern for Indian exporters, or do you think government should do something? Political pressure of US on Iraqi importers to buy US Long grain rice will have adverse effect on Indian Basmati export. Policy matters can restrict import of Indian Basmati in Iraq but it is difficult to change the taste of Iraqi consumers those who have tasted Indian Basmati in last few years. India Government should intervene in such matters as these are against regulations of WTO to keep the access of Indian Basmati in Iraq. Iran has been a major buyer of India’s basmati despite tough US sanctions. But it is facing payment issue. Does it affect the trade badly, or is there any relaxation in regard to payment issue? US sanctions have made it difficult for Iranian importers to import basmati from India which has created big difficulty for Indian exporters to trade with Iran. Big payments of Indian exporter are stuck up in Iran as a result of this. Iran, being one of the biggest importers of Indian basmati rice, any news results into deep effects to basmati trade in India. The recent arrangements of government for export of basmati to Iran in Rupee terms have helped to save this industry and farmerof the country. If we compare exports with domestic markets, we see that domestic markets are no less strong. In fact it is more lucrative. But due to lack of proper branding and distribution centres, the picture is not as great as it should be. What are your views, and would you expand in domestic markets in near future? The domestic market is becoming stronger every year with better realization to the

industry. Branded sales have resulted in many fold increase in basmati sales within India. Retail chains like Wal-Mart, Metro, Reliance, Big Bazar, etc. played a major role to widen the area of branded basmati with competitive price and easy access to the consumer. Knowing this fact, ASCW is equally focusing on the domestic market since beginning and targeting a double digit growth for Lal Qilla in India for coming two years. Modern retailing is emerging as a strong segment where the profit margins of retailers are high and low for rice traders. Despite this, rice traders are keen to sell basmati to retailers as the bulk of basmati consumers are high-end customers. Can you share your thoughts on this trend, and your experience with a retailer like Food Bazar, Spencer or Reliance Mart? To feed a country like India with a total population of more than 1.2 billion, modern retailing is playing a major role and any branded product needs to be placed at their outlets to obtain its market share. Although, manufacturer’s margins are low with modern retailing but reach of branded rice to the consumer is difficult without them. Our Lal Qilla is available in the majority of these outlets in the country and enjoys excellent relation with them. Most of the Basmati traders are entering value-added segments due to reasons like new generation’s preference of readyto eat food and snacks, and high profit margins. Do you have any plan to do the same? Concentrating more in the rice business, as there is a wide scope for further development, overall production of basmati is increasing in the country and simultaneously its market share is also growing in both domestic and export market. In the food segment, we are dealing in Lal Qilla Green Tea, Fried Onions, Soya Chunks and Soya Granules for the last few years and pursuing for the continuous growth of these products. Export of these products to many countries of the world is making Lal Qilla a household name. n

AgriBusiness & Food Industry w October 2012

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AgriBusiness & Food Industry w October 2012

Reach Over 11000 APEDA Members

AgriBusiness & Food Industry w October 2012

11-13 January, 2013 New Delhi, INDIA

India Ready to Host The Biggest Horticulture Event

With over 300 million middle and higher income population, India is the world's 2nd largest consumer base and fastest growing retail destination. Fresh fruits, vegetables & food intake are increasing and contribute to 13% of total organized retail that offers significant scope for investment in all related sectors. A huge domestic market supports high quality export oriented F & V production & value addition by providing a unique competitive edge. India, China and Pakistan along with other countries of the region make South Asia, the world's largest market.

ndia's growing horticulture sector has currently entered a revolutionary phase. On the one hand, small farmers are taking bigger risks and experimenting with diverse cash crops, and on the other, large corporate houses are taking to horticulture as a profitable business opportunity by bringing

in investments and latest technologies. Corporate farming, contract farming and food retail boom having become the present day buzzwords, the entire horticulture landscape is set to witness a big change. Expos Par Excellence The 5th International Horti Expo

AgriBusiness & Food Industry w October 2012

2013, along with 8th International Flora Expo 2013 and 2nd India Potato Expo 2013, is scheduled to be held from 11th to 13th January, 2013, at NSIC Exhibition Complex, Okhla, New Delhi. South Asian Horti Congress, BuyerSeller meet followed by Annual Award function will be held concurrently at the same vanue.

curtainraiser

Theme Pavilions The Event's Theme Pavilion will be on “Fresh Fruits & Vegetables”, "Farm Machineries & Equipment”, “Potato Products & Technologies”, “Cold Chain & Logistics”, “Seed, Agrochemical & Irrigation”, ”Organic”, “Agri Finance & Insurance”, “Processing & Packaging”, “Medicinal Herbal products", “Fresh Retailing”, and "Floriculture Wealth & Technology”. Celebrated Sponsors The expo, which has the Union Ministry of Agriculture as its Principal Sponsor, has a host of other celebrated sponsors including National Horticulture Mission, National Horticulture Board and Horticulture Mission for North East & Himalayan States. It is supported by the Ministry of Food Processing Industries, Agricultural & Processed Food Products Export Development Authority (APEDA), Food Processing & Packaging Machinery Industry Association, Irrigation Association of India, National Medicinal Plant Board, and Indian Flowers and Ornamental Plants Welfare Association. For the Ministry of Food Processing Industry, preservation and value addition at farm level is a focus area, and it also ensures the supply of quality food products to end consumers. On the other hand, the Ministry of Agriculture is aiming to double the production of all horticulture crops through NHM, NHB, HMNEHS and disseminating latest and modern practices of production and post harvest care. Thereby, it is also creating

opportunities of mass employment for people in rural areas by encouraging them to diversify from traditional crops to high value horticulture crops. All this helps in achieving long-term economic development. On the export front, APEDA is quite active. It is targeting agricultural and processed food exports to meet US $1520 billion target in coming years. Indian Cold Chain infrastructure is facing problems like lack of an integrated approach and efforts for effective policy formulation and information dissemination. Government investments worth Rs. 18,000 crore to Rs. 20,000 crore (US $ 42-46 Million) are required over the next few years. India as Retailing Destination India is now the world's hottest retail destination where true retail revolution is taking shape in the form of modern food retailing, super market chains, hyper market and cash & carry concepts. All these are creating waves in the Indian corporate sector. Organized Food & Grocery Retail requires direct sourcing of bulk produce from farmers and this ensures a great opportunity for them. Government of India is promoting modern marketing concepts and creating atmosphere in favour of Indian farmers, circumventing middlemen to increase the income of farmers. More than 5000 new outlets, 100 hypermarkets, 500 department stores and 2000 supermarkets are in pipeline. Over 6000 small and traditional outlets are going through the modernization phase.

The recent government decision to allow 51 per cent FDI in multibrand retail has opened up new horizons for retail trade expansion. With over 300 million middle and higher income population, India is the world's 2nd largest consumer base and fastest growing retail destination. Fresh fruits, vegetables & food intake are increasing and contribute to 13% of total organized retail that offers significant scope for investment in all related sectors. A huge domestic market supports high quality export oriented F & V production & value addition by providing a unique competitive edge. India, China and Pakistan along with other countries of the region make South Asia, the world's largest market. Therefore, 5th International Horti Expo 2013 will be an eye opener to the farmers and other stake-holders of every segment of agriculture and allied activities who want to expand and diversify their activities. Horti Expo 2012 The Horti Expo 2012, which was held in the national capital, turned out to be a grand success with participation by of over 250 companies and grower organizations from 16 countries. Delegations came from Nigeria, Nepal, Sri Lanka, Bhutan, Germany and Israel. Twenty Indian states and a large number of private sector companies put up impressive pavilions to exhibit their skills and performance in production, processing and marketing, including exports. The three-day event drew over 15,000 visitors. At the Flora expo, which drew maximum crowds, the presence of many Indo-Dutch companies presented a look of a mini Holland. The sections devoted to fruits and vegetables, aromatic crops, nurseries selling a variety of plants, farm machinery & equipment, organic food and the like had much to offer to the large number of visitors, moving around cheek by jowl. www.hortiexpo.com

AgriBusiness & Food Industry w October 2012

Eventreport

Focus on lucrative Asian fresh fruit and vegetable Markets

ore visitors and exhibitors than ever before took part in ASIA FRUIT LOGISTICA 2012, making this sixth edition of the event the biggest and best yet. A record 5,722 visitors from 64 different nations attended the popular event, which took place on 5-7 September at AsiaWorld-Expo Centre in Hong Kong. The visitor turnout, which marked a 7 per cent increase over last year’s attendance, confirmed ASIA FRUIT LOGISTICA’s status as the must-attend event for Asia’s rapidly growing fresh fruit and vegetable business. But it was the top-quality of the visitors – and the range of global countries they represented – that continued to define the success of Asia’s leading trade fair for the international fresh produce business. “We’re delighted with the number, quality and international scope of the buyers and trade visitors this year,” said Gérald Lamusse, Managing Director of event organiser Global Produce Events GmbH. Official visitor survey results revealed that 84 per cent of trade visitors held leading management positions in their companies, while 86 per cent were closely involved in the purchasing and procurement decision-making process. “This high calibre of visitors is a key factor in the continued strong business outcomes for our participants,” Lamusse added. ASIA FRUIT LOGISTICA 2012 set records on a number of other fronts, not least exhibitor numbers, which climbed to 341 exhibitors,

representing 30 different countries. The balance of regional representation was similar to previous years, although Asia, which accounted for the largest number of exhibitors (38 per cent), continued to expand its share. A quarter of exhibitors came from Europe, followed by Latin America with 12 per cent, Oceania (10 per cent), Africa (8 per cent) and North America (7 per cent). Unsurprisingly, China remained the single largest country in terms of exhibitor numbers with 87 exhibitors, up from 77 in 2011. European companies were out in force once again, and leading the way was Italy, which retained its position as the second-largest exhibitor country at the show with 29 individual exhibitors. Italy’s significant presence was anchored by the launch of the ‘Piazza Italia’ concept at ASIA FRUIT LOGISTICA, which is already a popular theme of the country’s national pavilion

AgriBusiness & Food Industry w October 2012

at Fruit Logistica in Berlin. In another strong signal of European companies’ growing focus on Asian markets, Belgium-based industry giant Univeg took part as an exhibitor for the first time. Elsewhere, Egypt significantly expanded its presence at this year’s show following the country’s debut appearance in 2011. After Australia with 24 exhibitors and the US with 23, Egypt was in fact the fifth-largest country at the trade fair in terms of exhibitor numbers, with a total of 21 companies represented. This year’s ASIA FRUIT LOGISTICA featured a record 18 national pavilions, with Mexico, Greece and Portugal taking national pavilions for the first time at the event. Another notable trend of this year’s event was the increased size and quality of the stands. “The average stand size has grown per exhibitor, which also demonstrates the growing commitment of companies around the world to this

Eventreport event, and to the Asian markets,” said Lamusse. ASIA FRUIT LOGISTICA took place in conjunction with Asiafruit Congress, Asia’s premier fresh fruit and vegetable conference event, whose sessions ran each morning before the trade fair opened. Patrick Vizzone, managing director of Rabobank International’s Hong Kong branch, set the agenda for the fifteenth edition of the Asiafruit Congress with a keynote address on Asia’s remarkable economic rise, and what it means for the global fruit and vegetable business. Day Two of the Asiafruit Congress opened with a focus on retail sourcing strategies in China, with expert insights from David Zhang, head of Spar Beijing, and Ben Cavender of China Market Research Group Asia. Plenary sessions on Day Three, meanwhile, looked at what Asian retailers are doing to boost the appeal of their fresh produce departments, and at the challenge of gaining and maintain access to key markets in Asia. As part of a fresh format, this year’s Asiafruit Congress also featured new breakout sessions on more specific themes, including the role of good agricultural practices in Asia, the importance of on-pack messaging, the development of the berry category in Asia, and the growth of the Korean market. In addition to the Asiafruit Congress, a number of other industry meetings and functions took places on the fringes of the trade fair and conference event. For the first time, the Southern Hemisphere Association of Fresh Fruit Exporters (SHAFFE) held a regional meeting in Asia during ASIA FRUIT LOGISTICA. The meeting was attended by 20 representatives covering most members, demonstrating the increasing role that Asian markets are playing for Southern Hemisphere fruit producers and exporters. According to the organizers, the next edition of ASIA FRUIT LOGISTICA and Asiafruit Congress will take place on 4-6 September 2013 at the AsiaWorld-Expo Centre in Hong Kong.

AgriBusiness & Food Industry w October 2012

interview

Dismantling the APMC would have been a far more revolutionary move than allowing FDI, says Nagesh Shetty Deccan Produce, a registered trademark of Deccan Edibiles Pvt. Ltd, derives its name from fresh produce sourced from the Indian Deccan Plateau. Mumbai-based company is famed for being a dynamic, quality conscious center, sourcing from the best manufacturers and orchards of the region. Nagesh Shetty, Director, Deccan Edibiles Pvt. Ltd, in a chat with Agri Business & Food Industry, spoke about Asia Fruit Logistica’s importance to enhance trade and FDI’s effect on the country’s retail system, among other things. Excerpts:

Nagesh Shetty As an exhibitor, what have you gained from Asia Fruit Logistica? What was your overall experience about the popular show, and what products have you displayed? Lots. Initially I was a little dismayed with the response, if I was expecting a flurry of activity it did not happen. I guess we have to see this as a Branding exercise in a developing market. You have to constantly introduce meet and network and the benefits follow. It is like Shri Krishnas Precept ‘Do your duty without thinking of the fruits of your action’. Some decades ago, facts about fruit

consumption was worth mentioning only when we wrote about developed countries, but now even in developing countries like Bangladesh, Thailand, Indonesia and Pakistan and India, fruits are no more prerogative of the affluent class, which has been proved by the atmosphere at the recently held “Asia Fruit Logistica 2012”. And despite high rates, middle class people are eating it almost regularly. What are the reasons behind this positive change? Even a 2% shift in eating patterns of this huge Asian Continent creates a big demand and it is well known that in the last few years Asia has become the powerhouse for World Growth. Translated into greater buying power at the hands of people living in Asia means Asia is where the action is. Its time has come. Asia Fruit Logistica is the biggest event of its kind to promote fruit trade in Asian countries. Please tell us how much is it useful for fruit growers, exporters and importers of developing countries, particularly India? Importers are aware of its use and are there year on. More Exporters need to be there. It shows that India is a force in the fruit export industry too. Growers yes, if they want to know what’s happening in the market front and to imbibe more.

AgriBusiness & Food Industry w October 2012

India is emerging as one of the biggest importers of fruits, buying from Australia, US and China, Chile etc. Do you see any export-import gap? What is your thought on it? Big gap. That is going to grow wider in the time to come. Gulf and Europe are the focus markets for Indian fruits and vegetable exporters, but low price realization and competition is an issue. In this scenario, do you see increasing exports to Middle East and European markets? Unless the calculus of business changes in these two areas, I think things will stagnate. Also, we need to find demand specific items that can command higher value in these markets. If there is demand all markets will pay. Domestic prices of fruits and vegetables are higher. Do you think exporters face problems in sourcing the material for exports? Exporters are in the business of making profits too. They must export only when feasible. Everything is demand driven. Due to education, Indian consumers are becoming very health-conscious. The vegetables and fruits are said to have pesticide residue, which is being

interview monitored by FSSAI. How do you view this development? This is a long overdue process. Indians have no reason to eat pesticide laden veggies when we export them pesticide free. Its not difficult to have them incorporated in the system. Once the farmer is educated he will do it and maybe find ways to do it cheaper. We have to create an awareness and market for it. India is suffering from lack of cold chain, due to which 30-40% of the horticulture produce go waste, as they are highly perishable. What do you think should be done to address this issue? Here we need to be very product specific. Let me explain. In the fruits-Grapes and pomegranates--that I deal in, is there 30-40 per cent wastage? It is highly unlikely. So where is this

wastage? Is it solely due to cold store reasons? No, there are several reasons, like an underdeveloped processing sector. We have to define wastages in terms of items and then find solution to this problem. I think the food processing sector has a major role here, but the bottom line is that fresh produce gives the best remuneration to the farmer. Hence, I agree this is a very critical issue and affects the small farmers like nothing else does. India Government recently opened FDI in multi-brand retail, which is a major step forward. In this scenario, please tell us about your future plans? I would love to go to the customer directly. Why me? The farmer should be able to go to the customer directly. With our giving the small businessman the opportunity to go direct to the farmer, can we hail FDI in retail to do

wonders? So dismantling the APMC (Agricultural Produce Market Committee) would have been a far more revolutionary move. Secondly, how many retail giants are sourcing directly? Very negligible. So while any new opportunity to the farmer is always welcome, today the big retailer has only replaced the roadside vendor with a better sales format. I feel opening the markets within were far more important. After that I, an exporter, the big retailer and the direct consumer will all compete to go to the farmer. Imagine that’s the India we have to aim at. Deccan Produce will continue it efforts to popularize Indian produce. Personally, I wish to work with more like-minded exporters to create a forum to popularize Indian Produce. n

India’s fresh fruit imports go up China tops in apple supply

ndia’s fresh fruit imports are dominated by apples, which, in volume terms, account for more than 75 per cent of the total fruit imports. Import of apples grew to 122,878 tonnes in 2010, from 90,714 tonnes in the previous year – an increase of 35.5 per cent. (The apple imports into India rose further to 162,651 tonnes in 2011, as per provisional figures.) According to the figures provided by the latest edition of Asiafruit Congress Statistics Handbook, the main suppliers of apple to India in 2010 were China 58,289 tonnes, United States 30,660 tonnes, and Chile 25,442 tonnes. Imports from China’s grew by 61 per cent compared to the previous year and from Chile by 21 per cent, while that from the United states declined by 25 per cent India also imports apples

from New Zealand (6,050 tonnes) and Australia (1,104 tonnes). Besides apples, other fruits coming into India include Pears (17,659 tonnes accounting for 10.9 per cent of the total share of fresh fruit imports), oranges 10,166 tonnes –6.3 per cent), Kiwifruit (3,238 tonnes – 2 per cent), grapes (2,664 tonnes –1.6 per cent), plums 673 tonnes – (0.4 per cent) and others (5,136 tonnes – 3.2 per cent). Exports As far as export of fresh fruits from India is concerned, mangoes and grapes remain on the forefront, followed by banana. Total exports from the country in 2010 in volume terms showed a sizeable decline of 75.5 per cent – from 600,007 tonnes in 2009 to 369,288 tonnes in 2010. The handbook has clubbed the figures for mangoes, guavas and mangosteens, which account for 49.5 for the total export of fresh fruits from this

country. Their export in 2010 was 182,972 tonnes, against 267,617 tonnes in 2009. The export of grapes in 2010 was 64,334 tonnes (against 108,554 tonnes in the previous year) and bananas 58,096 tonnes (45,752 tonnes). Like most other fruits, apple exports also showed a decline, the fall being 37.2 per cent – to 17,170 tonnes in 2010 from 27,354 tonnes in the previous year. The export figures for other fruits in 2010 are: Lemons and limes --11,294 tonnes (23.950 tonnes in previous year); melons – 7,391 tonnes (11,574 tonnes); oranges – 5,552 tonnes (23,350 tonnes), others – 22,479 tonnes (91.856 tonnes). --TVS

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marinefoods

Fisheries in India: Prospects & Possibilities â&#x20AC;&#x201C; Dr. S. Ayyappan

isheries in India could be recognized as an important allied sector of Indian agriculture only after independence. The vibrancy of the sector can be visualized by 11-folds increase in fish production in just six decades, i.e. from 0.75 million tonnes in 1950-51 to 8.3 million tonnes at present (2011-12). The unparallel average annual growth rate of over 4.5% over the years has placed the country on the forefront of global fish production, only after China. Besides meeting the domestic needs, the dependence of over 14.5 million people on fisheries activities for their livelihood and foreign exchange earnings to the tune of Rs 129 billion (2010-11) from the fisheries produce, amply justifies the importance of the sector on the

country's economy and also livelihood security. The term 'fisheries' in broader sense, includes both capture fisheries and aquaculture. Although the fish production from capture fisheries has witnessed steady increase since independence to reach 4 million tonnes at present, its contribution is overshadowed by the spectacular growth made by aquaculture in the last three decades, which increased from 0.37 million tonnes in 1980 to 4.3 million tonnes at present. The present production of 3.1 million tonnes from marine fisheries along 8129 kms coast line is not far behind the fishery potential of 3.93 million tonnes in our Indian EEZ and provides limited scope for further increase in production. However, the sector is considered to be

AgriBusiness & Food Industry w October 2012

equally important due the dependence of large section of poor fishermen communities for their livelihood avenues. Similar has been the case for the fishers living along the banks of rivers and other open water-bodies. The technological interventions made in the development of fish harvest technologies in areas of modernization of boats and fishing gears, mechanization of propulsion system, introduction of synthetic gear material; developments in acoustic fish detection and satellite-based remote sensing techniques; advances in electronic navigation; enhancement of the fishing capacity, provisions for onboard fish processing and preservation; and improvement of the working conditions not only have been able to sustain the growth of the marine capture fisheries, but also reduced the drudgery of fishermen to a great extent. Appropriate management interventions viz., restriction of fleet size, regulation of mesh size, declaration of closed season, ban on operation of the destructive gears, installation of artificial reefs, promotion of sanctuaries, ranching of commercially important and threatened species and above all implementation of effective code of conduct for responsible fishing have been suggested as a management measures for long-term sustenance of fisheries. In inland sector, while the rivers, estuaries, backwaters, lagoons, etc., have witnessed higher level of exploitation, the reservoirs and floodplain wetlands possess high potential for enhancing fish production, at least 4-5 folds through culture-based fisheries, with regulated stocking based

marine foods on the biogenic capacity of the system. Aquaculture in India has evolved as a viable farming practice over last three decades with considerable diversification in terms of species and systems, and has been showing an impressive annual growth rate of 6-7%. While the carp-based freshwater aquaculture, mainly constituted by the Indian major carps, viz., catla, rohu and mrigal, has been contributing over 90% of the aquaculture production satisfying the domestic need, the shrimp-based coastal aquaculture with only about 5% share contributes much of the export earnings. Induced breeding of carps and catfishes, hatcheries for massscale spawning, seed rearing and carp polyculture are some of the epoch-making technologies actually guided the freshwater aquaculture development. The sector also has shown considerable diversification in recent years with adoption of other species like catfishes and freshwater prawns, owing to their higher market demand and economic advantages. While production of 4-5 tonnes under carp polyculture is quite common, farmers of several regions are able to produce 8-12 tonnes/ha/year. Integrated fish farming with livestock and horticulture has not only been able to utilize the byproducts/

wastes as principal inputs, but also made the farming practice highly remunerative and farmers' friendly. Development of improved rohu (Jayanti) through selective breeding with record of 17% higher growth response per generation after seventh generations, availability of balanced supplementary feed for different life stages for diversified cultivable species and appropriate disease management measures are some of the important developments. Almost five-folds growth in mean national pond productivity in last four decades, i.e. from about 600 kg in 1970s to 2900 kg/ha today is a testimony of the sector's vibrancy. With the cap of second largest aquaculture producer in the world, aquaculture today is also considered as a sunrise sector for meeting the increasing fish demand in coming years. Development of protocol for ornamental fish breeding and management has provided important livelihood options for marginal and land-less farmers in certain localities. Promotion of trout and mahseer farming in upland coldwater region has also shown significant potential for aquafarming. Brackishwater aquaculture in India has been concentrated around the black tiger prawn as the single most important species. Recently, culture of exotic

Pacific white shrimp, Litopenaeus vannamei, however, has attracted the farmers because of its fast growth, low incidence of native diseases, availability of Specific Pathogen Free (SPF) domesticated strains and culture feasibility in wide salinity range. With the production levels of 10-12 tonnes/ha/crop of 3-4 months the production of this species has reached to a level of 80,000 tonnes at present Mariculture in India although was at very low key with farming of mussels and edible oysters undertaken in some coastal region of Kerala over the years, successful demonstration of sea cage farming in recent years, initially with seabass and most recently cobia, however has shown the prospects of mariculture in the country. It is estimated that the fish requirement of the country by 2025 would be of the order of 16 million tonnes, of which at least 10 million tonnes need to come from aquaculture. Therefore, development of road map based on available resources, at least at district levels, necessary to be formulated to achieve this target. (Courtesy: ET. The author is Secretary to the Govt. of India and Director General, Indian Council of Agricultural Research, New Delhi)

Marine exports may pick up by 28% in one year

ndia's marine exports are likely to grow by over 28 per cent yearon-year to USD 4.5 billion in the current fiscal on rising demand in western markets like the US and Europe. During 2011-12, seafood exports stood at USD 3.5 billion, according to the data provided by the Marine Products Export Development Authority (MPEDA). "We expect seafood exports to touch USD 4.5 billion in 2012-13 due to increase in demand, mainly for Litopenaeus Vannamei shrimp and Black Tiger shrimp, in the US

and European markets," an MPEDA official said. The US and Europe together account for over 45 per cent of the country's total seafood exports. Litopenaeus Vannamei shrimp and Black Tiger shrimp, top the list

of favourite seafood items in countries like Europe, American, Japan and China. During April-June, the country's marine exports grew at a healthy rate of over 15 per cent compared to the last fiscal. Also, the focus is on better infrastructure facilities to encourage production of value-added items, the official said. The MPEDA, which is under the Commerce and Industry Ministry, is the nodal agency for promotion of export of marine products from India.

AgriBusiness & Food Industry w October 2012

Retail

News Carrefour to shut 2 outlets in Singapore

arrefour said that it was pulling out of Singapore with the closure of its two existing outlets in the citystate by the end of this year. The French retail giant was the first to introduce the hypermarket concept in Singapore with the opening of its first store in 1997. But Carrefour has found it tough to penetrate Singapore's market of 5.2 million people largely because other rivals are better entrenched with a wider network of branches, many of them near public housing estates. Carrefour's two existing stores are located within distance of each other in the city-state's main shopping and business district.

"Carrefour Singapore announces the decision to close its Suntec and Plaza Singapura stores before end of 2012, since expansion and growth perspectives do not allow reaching a leadership position in the medium and long term," the retailer said in a statement. The decision to withdraw from Singapore is not a surprise, according to a senior executive with an Asian electronics company which is among Carrefour's suppliers. "There was a lot of talk (of closing) from the internal staff and they have been clearing stock for the last two months," the executive, who declined to be named. "They were just not competitive enough."

Carrefour, the world's second biggest retailer behind US group Walmart, reported in March that its 2011 profit dropped by 14.3 percent to 371 million euros ($463 million) amid weaker economic conditions.

Sahara to invest Rs. 3,000-cr in retail

ahara India is gearing up to invest Rs 3,000 crore for its retail venture, while setting an ambitious revenue target of around Rs 50,000 crore after two years. The group claimed that it will open around 1,000 retail outlets under the 'Sahara Q Shop' brand initially in five states covering 60 cities and towns by 2013. The initiative will kick off from August 15. "The company has made an initial allocation of Rs 3,000 crore towards this business. We will invest according to the need as we go ahead," Sahara India Pariwar Chairman Subrata Roy said. The first-phase launch of Sahara Q Shops, which would have an area of 300 square feet each, will be in Uttar Pradesh, Uttarakhand, Rajasthan, Bihar and Jharkhand. Earlier this year, Sahara had announced its plans to foray into the retail sector under the 'Sahara Q Shop' brand of stores. These stores would market a range of products under 73 categories, including staples, processed foods, personal care products and home care products.

The company plans to launch retail outlets in 998 towns and cities by March 2013. It is also aiming at revenues of Rs 15,000-20,000 crore in the first 12-18 months and around Rs 50,000 crore after two years. "We are looking to open around 60,000 outlets in the country in the next 12-18 months. These would majorly be company owned," Roy said. He added that the new venture would provide jobs to around 1.43 lakh people gradually within 18 months. When asked about the reason for entering into the new segment, Roy said: "We always try to plan something to enhance the earnings of our workers. This is a very growing business in India. Today the yearly sale of these products in the country is 16 lakh crore and a growth rate of 20 per cent". The customers would be able to place an order for merchandise at these outlets and the items would be delivered at home by the company's sales force. Speaking about the hotel business expansion plans in the country Roy said: "In India, we are going to add around 25,000 rooms in the five star category with in two years. In four star and three star categories, we are going to add around

AgriBusiness & Food Industry w October 2012

15,000 rooms," Roy said. He also said that the company would be launching dairy business in March next year. Replying a query, Roy said Sahara has bought Digicable for USD 52 million. When asked about FDI in retail Roy said: "If it is coming as quality aspect we should welcome anybody and everybody. But most important, which would be suicidal if we allow them to bring products from outside. "It will be suicidal for the country, so the condition should be they have to manufacture here barring certain items which are difficult to manufacture here," he added.

AgriBusiness & Food Industry w October 2012

Retail

News Yum! to open new Pizza Hut branches

he world's largest restaurant company Yum! Brands Inc, with chains such as Pizza Hut and KFC, will invest in opening new outlets in India and speed up expansion as it targets more than $1-billion revenues in the country within five years. Yum! Brands opened its first owned Pizza Hut store in the country few weeks back at Mumbai's Mira Road as it plans to take on the country's largest pizza chain Domino's Pizzamore aggressively. "India is one of the very few countries where the company is investing in equity as there is immense potential for growth in this business," Yum Restaurants India GM (Pizza Hut Delivery business) Sanjiv Razdan said. "We have opened our first equity store in Mumbai and this format is going to be part of our growth strategy for 2020," he added. Till now, Pizza Hut was 100% franchisee operated in India mostly through PepsiCo bottler

Ravi Jaipuria's Devyani International. Yum! plans to double its overall investments and store count in the country in three years by bringing in $100 million and opening 500 outlets by 2015. Industry experts feel Yum!'s move could be a game changer in a market where most global restaurant chains follow franchisee models, and trigger a foreign investment boom in the restaurant market. "We could see increasing examples of parent firms buying out partners in India, though this is not exactly the case with Pizza Hut," Harminder Sahni, MD at retail consultancy Wazir Advisors, said. While, global chains opt for a franchisee route to kick-start the business, when the market expands they would want to invest because franchisees have a limited capacity. India is one of the fastest growing markets in the world. Retail consultancy Technopak Advisors estimates the country's 'eating out' market at close to

33,000 crore. The organised segment is valued at about 8,000 crore, growing 20%-25% a year. "Global chains are looking for more control of India operations and want more share of the value creation of their brands," Sahni said. While US' McDonald's operates through two separate joint venturesConnaught Plaza Restaurants and Hardcastle Restaurants-here, others such as Domino's, Dunkin Donuts, sandwich chain Subway and UK coffee chain Costa Coffee depend on franchisees. Yum! has 138 Pizza Hut dine-in stores, 98 Pizza Hut delivery stores, 181 KFC outlets and three restaurants of Mexican inspired QSR chain Taco Bell in the country. Yum Restaurants India owns about half of KFC outlets. All other Yum! stores are run by franchisees.

Bharti Walmart increases its private labels to 400

harati Walmart recently announced the introduction of private labels as it commissioned its 18th wholesale store Best Price in the country at Hyderabad. “This is the third store in Andhra Pradesh. We plan to add at least five more in the country during the year and 10 more next year,” Raj Jain, President, Walmart India, and Managing Director, Bharti Walmart, said. The venture has so far invested $21 million (about Rs 120 crore) in Andhra Pradesh for three stores. It is looking at two more stores. It takes about Rs 40 crore to set up such a store. The store is spread over 53,000 sq ft. From day one, it will have about 60,000 members. It will mainly cater to mom-and-pop stores, office and institutions and Horeca (hotels, restaurants and caterers) segment. The three private label brands cover Right Buy, Members Mark and Bakers

& Chef, offering about 400 items. “We assure a saving of 15 to 20 per cent over similar brands. It is possible to offer such pricing as we source them directly,” Raj Jain said. The Government announcement on FDI in retail is barely nine days old. About eight States, including Andhra Pradesh, have agreed to support this. “We are still in the process of studying its implications. It will take at least 12 to 18 months to come out with the retail format,” he explained. The company is focusing on investing in the back-end interface with farmers. This will be a win-win situation for the farmers as they will get good prices and stores will have access to best farm produce. However, there is need to invest significantly in supply chain.

AgriBusiness & Food Industry w October 2012

According to the new guidelines, it is necessary that new investment comes through FIPB route. Therefore, we will have to make a formal application, he said. But the challenge for retailers will be to find good sites to set up stores. The real estate costs are ruling high, requiring high investments.

Corporate

News PepsiCo and LT Foods to increase Kurkure output

lobal food and beverage player PepsiCo has signed up with Delhibased LT Foods for manufacturing, processing and packaging of its rice-based snack, Kurkure. LT Foods is known for its Daawat Basmati rice brand. A new plant with a capacity of 796 tonnes a month has been set up under Daawat Foods Ltd, which is a majorityowned subsidiary of the LT foods. The plant is located at Kamaspur, near Sonepat, Haryana, on the outskirts of Delhi. Praveen Someshwar, CEO (Foods), PepsiCo India, said, “Our India food business has been a growth driver for PepsiCo globally, recording consistent high double-digit growth rates over the past few years. Our flagship snack brands, Lay’s and Kurkure, have sales of more than Rs 1,000 crore each.” To build on this opportunity, we are

looking at greater support from our business partners and have tied up with LT Foods as one of our copackers for Kurkure, he added. PepsiCo works on an outsourced model. Its food division has three self-owned plants and a few co-packers across India. Vijay Arora, Chief Managing Director, LT Foods, said, “During the stabilisation period of 90 days, PepsiCo would be training our workforce. The commercial run at the plant has already begun. This is mainly to fill the gap between demand and supply for the brand.” The tie-up would entail LT Foods being paid conversion charges — a combination of return on investment and

operating cost. With this venture, LT Foods is embarking on a new venture of engaging their manufacturing, processing and packaging facilities for a brand other than its own. The company said it is also exploring production of other products with PepsiCo, such as oats.

Nestle chief wants an end on using food in bio-fuel production

he chairman of the world's biggest food group Nestle, Peter Brabeck, has called on politicians to lobby to end the use of food in the production of biofuels. "This does not mean that biofuel should be scrapped entirely but that producers should use other organic materials," Brabeck said in an interview with Swiss newspaper SonntagsZeitung. He joins a growing chorus of politicians and scientists who are calling for a rethink in the production of biofuels. "Our problem is that almost half of U.S. corn production and 60 percent of European rape is being used for fuel production," he said. Biofuel production is adding pressure on food

prices which are already being boosted by climate change. "(Food) prices are increasingly prone to swings and correlate more and more with oil prices," he said. He also called for more transparency in international commodities markets. Brabeck predicted Nestle's input costs for key commodities such as milk, coffee and cocoa would fall in the second half of the year. However, should the price situation remain tense, the company would feel an impact in the medium term, he warned. The Swiss-based company owns brands such as Nescafe coffee, KitKat chocolate bars and Maggi soup.

AgriBusiness & Food Industry w October 2012

Corporate

News

Pak, India to have free trade in 5 year

arely two years after resuming trade talks, India and Pakistan have chalked out a plan to emerge as virtually free trading nations in South Asia in the next five years. This could pave the way for other countries in countries in the region to follow as precursor to South Asia emerging a free trade zone in eight years from now. Other member countries in the Saarc region include Bangladesh, Sri Lanka, Nepal, Bhutan, Maldives and Afghanistan. Though India has free trade agreement with other SAARC countries such as Sri Lanka, it is onesided in the sense while India allows free imports. There are restrictions for Indian goods to enter those countries. India and Pakistan being the two largest countries in South Asia, will show the way to other Saarc countries to embark on two-way free trade arrangements, eventually turning

the entire South Asia into one free trade zone. At the recently concluded secretarylevel talks between the two countries in Islamabad, India has agreed to reduce its tariff lines by another 30 per cent on 436 items by December, and further scale down the list to about 100 by April 2013 under the Safta sensitive list. At present, Pakistan has 936 tariff lines under its Safta sensitive list against 614 tariff lines of India. “This would be possible on the condition of Pakistan keeping up its promise of granting India the most favoured nation (MFN) status by December as well as removing all trade restrictions at the Wagah-Attari border,” a senior government official said. He added that this would be the first such free trade agreement in the southern region after which the two countries will work together towards turning the entire subcontinent into a free trade zone. According to the official, Pakistan would

AgriBusiness & Food Industry w October 2012

seek its cabinet approval to simultaneously notify its dates of transition to bring down Safta sensitive list to a maximum of 100 tariff lines within next five years with an equal number of reductions each year so as to reach to the level of 100 lines before end of 2017. “However, while they will do it for all Saarc countries, India’s reduction in tariff lines would be specific to Pakistan,” the official added. Thus, by the end of 2017 both India and Pakistan would have no more than 100 tariff lines in their respective Safta sensitive lists. This means that the two countries would trade among themselves in all items, barring these 100, at a peak tariff rate not exceeding five per cent. This is expected to push bilateral trade to $6 billion in next five years, going up to $10 billion by 2020, against $2.7 billion in 2010-11.

F&B

News Britannia sales jump up 11%

ritannia Industries said it will focus on revenue, cost management and innovation to boost sales and profitability at a time when hardening commodity prices have put margins under pressure and there are real fears that deficient monsoon rains will hit consumer demand. Nusli N Wadia, chairman of the biscuits and dairy products maker, said the emphasis on innovation has already ensured that new products account for 10 per cent revenues in Britannia's bakery business and 14 per cent in dairy. "We will further grow the revenue from innovative products even as there are 380 different cost reduction projects running within the company across the spectrum," he told the 93rd annual

general meeting of Britannia Industries, on August 6. Britannia improved its operating margin by 120 basis points in the first quarter ended June, posting net profit of Rs 43.5 crore on net sales of Rs 1,221.6 crore. While net sales increased 11 per cent year-on-year, the jump in net profit was only 4 per cent because a sharp fall in other income. During April-June 2011, Britannia had an additional profit of Rs 10.4 crore generated from sale of property. Britannia Industries Managing Director Vinita Bali said the company is moving to clean fuel like propane, LPG and biomass and undertaking changes in machinery. The move has already generated huge savings and insulated the

company from fuel price fluctuations. At the same time, the company is investing in capacity expansion and new product development. Last year, Britannia set up two plants, in Patna and at Khurdah in Orissa, each at a cost of about Rs 50 crore. It now plans another plant in Gujarat.

Parle will keep on expanding, says Mayank Shah

ayank Shah, group product manager at Parle Products, the country’s largest biscuit maker, is not interested in launching a wide array of products. Content at being the leader in the glucose category with 79.4 per cent market share, Shah is looking at increasing the glucose category by 15 per cent over the next financial year and capturing single digit market share from competitors. Even as Parle G, the glucose biscuit brand from Parle Products, has consolidated its position as the world’s largest selling biscuit, a recent report by market research agency Nielsen shows that Britannia Industries holds 8.7 per cent market share in the glucose category, while ITC holds 8.3 per cent share. Shah insists it is not the only accolade. “We have moved away from being just a one-product company to having 8-10 big brands. Our sweet cookies range is way bigger than our competitor Britannia, though the company is trying to ape us with many launches,” says Shah. Nielsen data from the last two quarters shows Britannia leading with 34 per cent market share in the sweet cookies category, while Parle has 26.3 per cent share. ITC holds 8.4 per cent market share. Targeting each product of the competitor, he says, “We are not just

leaders in the glucose category. We are also leaders in the crackers category with Monaco and Krackjack. We have also gone past our competitors in the cream category, though we came in much later.” Referring to the cookies category, he adds, “Though they (Britannia) have Good Day, four years ago we came up with 20-20. In terms of market share of the cookie portfolio, we are way bigger than Britannia.” Stating that “Nielsen is under reporting the figures as is known,” Shah adds, “One thing is clear. There is absolutely no compromise on taste. Though we have several big brands, and Parle G is the world’s largest selling brand in terms of volume, our only limitation is in terms of assortment. There has been a clear focus on this.” Given the surfeit of biscuit manufacturers in the market, players such as Unibic, Priyagold, Anmol and United Biscuits have been biting into large chunks of the market. Parle’s Shah is unfazed. “Like most companies we also thought rather than restrict ourselves to just biscuits, we should explore other packaging items to fight for a larger share of stomach. All of these, however, had to be within the biscuit or snacking gamut,”

added Shah. The company has gone about restructuring its snack portfolio to gain a larger market share in a category dominated by PepsiCo’s Lay’s, Kurkure and Cheetos, including local players Haldiram, Balaji Wafers and ITC. In terms of confectionary too, Parle Products has a strong presence with leading brands such as Melody, Mango Bite, Kaccha Mango Bite and Poppins. The firm has recently launched a lacto candy Londonderry. An advertisement for the same has been shot in Europe with an international cast and crew. Parle Products also recently put out a new creative campaign ‘empty stomach’ for its 20-20 cookies. Advertising agency Ogilvy and Mather (O&M) developed an integrated campaign with multiple executions to position Parle 20-20 as a quick anytime hunger fix. “The communication strategy was very clear. All of us know what an empty stomach feels like. Everyone and everything feels like a hindrance. We are at our worst — restless and irritable. A quick hunger fix is exactly what one requires in these situations,” said an O&M official. The hole in the stomach creative emphasises hunger.

AgriBusiness & Food Industry w October 2012

F&B

News Agriculture Ministry asks states to include millets in noon meal

he Agriculture Ministry has asked the States to include millets in the mid-day meal scheme to increase the demand for the cereal and, thereby, enhance farm incomes. Millet crops or coarse cereals are known for their high nutritional value and are effective in controlling diabetes and obesity. But the area under millets has been steadily declining though they are suited for arid and semiarid regions, besides adaptability to moisture stress. The commonly cultivated millets under rain-fed conditions are sorghum (jowar), finger millet (ragi or mandwa), pearl millet (bajra), foxtail millet, barnyard millet, proso millet, kodo millet and little millet. In his letter to the Chief Secretaries of the States, Union Agriculture

Secretary Ashish Bahuguna said introduction of millets in the meal scheme would go a long way in increasing the nutritional standards of schoolchildren. He said the Department of Food and Public Distribution System had agreed to facilitate supply of millets but the response from the States for allocation for the meal scheme was not very encouraging. The Agriculture Ministry last year introduced a scheme — Initiative for Nutritional Security through Intensive Millet Promotion (INSIMP) to boost cultivation. But it has not picked up mainly due to a lack of adequate demand for millets. “Fantastic step” Describing the move to introduce millets in the meal scheme as a “fantastic step,” Millet Network of India (MNI)

national convener P.V. Satheesh said that it should have been done decades ago. “This will go a long way in reducing nutritional deficiency. India stands 128th in the Global Malnutrition Index mainly because the food given under various schemes, including mid-day meal and the Integrated Child Development Scheme is rice and wheat-based which by itself is not enough.”

DS Group enters powdered beverage segment

he Dharampal Satyapal (DS) Group, makers of Catch, Pass Pass and Chingles, entered the powdered beverage segment with the launch of Yomil, a ready-to-make milk shake. Priced between Rs 6 and Rs 14, Yomil is available in four flavours — Choco Milky, Milky Mango, Milky Rose and Milky Kesar Badam. A single serving weighs 165 ml. The milk shake powder would be associated with the Catch brand and will run on its distribution network, the company said. The company will invest Rs 25 crore

as marketing expenditure for financial year 2013. “We are positioning the product as fun in taste and a healthier option,” said Atanu Gangoly, Head-Confectionary and

AgriBusiness & Food Industry w October 2012

Powdered Concentrate, DS Group. The product aims to target school children, those between 15 and 24 years of age and young mothers. The company said a new TV commercial has also been started in the first week of September, followed by radio contests, online initiatives and below-theline campaigns for consumer trials. The DS Group has already installed 40 vending machines across North India, including in universities and corporate offices. The powdered fruit-based product market is pegged at Rs 400-500 crore in India.

F&B

News DuPont to expand food & nutrition business

Rajeev Vaidya, President - South Asia, DuPont, and Craig Binetti, President, DuPont’s global nutrition and health business, at a press conference in Delhi

uPont is expanding its food and nutrition business in India and plans to set up a food application centre to

develop local solutions. “India is a key market for us. We are bringing our global expertise to develop food solutions tailored for the local market,” said Craig Binetti, President of DuPont’s global nutrition and health business. DuPont provides ingredients that go into food, bakery and dairy products, enhancing the quality, taste and shelf life of such products. The India subsidiary of the global science and technology major is yet to finalise a location for the proposed centre. It did not comment on the investment

plan or spell out a timeframe for the centre. “We have been working with several food companies in India and want to expand our relationship with them,” Binetti said. India is one of the fast growing markets for the $38 billion firm, which earns a third of revenues from agriculture, food and nutrition segments. DuPont, which earns about $900 million in revenues from India, has over 4,000 employees working in the country.

Private equity firms look aggressive for restaurant chains

here is a new flavour in the air. The scent of money has got a host of venture capital and angel investors lapping up the offerings of the food and beverage sector. India’s $13-billion fast food industry is largely fed by internationally renowned Western brand names. However, the sharp annual growth rate of 30-35 per cent of QSR (quick service restaurants) also known as fast food restaurants, has not gone unnoticed by institutional firms and private equity (PE) ventures. In a sign that PE firms remain hungry for restaurant chains, the $1.4-billion Asia-focused PE major, New Silk Route announced an investment in Bangalorebased South Indian food chain, Vasudev Adiga. Earlier this year, JS Hospitality Service, which owns New-Delhi based restaurant chain, Pind Balluchi, sold 45 per cent stake to Everstone Capital to raise $20 million. The company owns 30 Pind Balluchi restaurants, mostly in the National Capital Region, which serve north Indian cuisine. Raising capital may not be the most daunting task for the food and beverage (F&B) industry. Especially for home-grown QSR chains, which offer convenience in terms of access, pricing and a diverse menu. CHANGING LANDSCAPE “The F&B segment is in sync with

the overall consumption theme and the changing consumption landscape in the country. Any mall that opens brings with it multiplexes and other avenues. Food is added in some form or the other. QSR chains are flourishing. We have been tracking the broad consumption theme”, says Jaspal Singh Sabharwal, Partner at private equity firm Everstone Capital Advisors. With assets worth over $1.6 billion under management, Everstone is the second largest PE player in the country after ChrysCapital, which has over $2.25 billion of assets under management. F&B SECTOR The F&B sector is too hot and sizzling to be ignored and PE firms seek to leverage the rise of the Indian consumer through investments in restaurant chains. Research company Venture Intelligence estimates that early stage investments in the F&B sector in 2011 soared to $13 million, up from a measly $1 million in 2008. With venture capitalists eager to cash in on the opportunity, last year saw several deals in the making. INCREASED INTEREST ICICI Venture acquired a 10 per cent stake in F&B chain operator Devyani International in May for approximately $55.6 million. New Silk Route Advisors closed its

first Indian restaurant investment in July for $100 million. In August last year, India Equity Partners purchased a majority stake in specialty restaurant chain Sagar Ratna Hotels for $40.2 million. Increased interest in the restaurant business has been marked with some high-profile employee exits. Immediately following the infusion of funds, Sagar Ratna managed to wean away a senior manager from the Pind Balluchi outfit. “It is difficult to build a good team,” agrees Sabharwal. “In terms of people, one needs patience and capability”, he adds. Everstone took a majority stake in Pan India Food Solutions, one of the country’s largest restaurant operators that hosts brands such as Spaghetti Kitchen, Copper Chimney, Bombay Blue and The Coffee Bean & Tea Leaf among others.

AgriBusiness & Food Industry w October 2012

Health & Nutrition

News Coffee, exercise & veggies can fight cancer: Study

new study said that caffeine and workouts work together in staving off skin cancer. Researchers at Rutgers Ernest Mario School of Pharmacy in New Jersey have found that the combination reduced the number of skin tumours in cancerprone mice by 62 per cent. Tumours also shrank by 85 per cent.

Lead author Dr Yao-Ping Lu said: “We found that this combination treatment can decrease sunlightcaused skin cancer formation in a mouse model. I believe we may extrapolate these findings to humans and anticipate that we would benefit from these combination treatments as well.” In their study, rodents exercised on a running wheel after being given a dose of caffeine. Both caffeine and exercise alone produced positive effects, but benefit was greater when the two combined. Chinese women who ate cabbage, broccoli and leafy greens saw improved

survival rates after breast cancer than women who did not eat these cruciferous vegetables, said a US study. The findings came from data on 4,886 Chinese breast cancer survivors age 20-75 who were diagnosed with stage one to stage four breast cancer from 2002 to 2006 and who were part of the Shanghai Breast Cancer Survival study. Women who ate more cruciferous vegetables over the 36 months following their diagnosis saw their risk of dying from any cause decrease by 27 per cent to 62 per cent compared to women who reporting eating little or none of these veggies. The risk of dying of breast cancer decreased by 22 to 62 per cent for the cruciferous veggie eaters. The chance of recurrence also dropped by 21 to 35 per cent. The findings suggest breast cancer survivors “may consider increasing intake of cruciferous vegetables as part of a healthy diet”.

Cheese cuts risk of diabetes by 12%: Study

new research has claimed that cheese can prevent diabetes, even as the current health guidelines advise cutting back on dairy products. British and Dutch researchers found that eating just two slices of cheese a day cuts the risk of type 2 diabetes by 12 per cent.

Diabetes can cause heart attacks, strokes, blindness and nerve problems, without yet having been diagnosed. The researchers looked at the diets of 16,800 healthy adults and 12,400 patients with type 2 diabetes from eight European countries, including the UK. The study, published in the American Journal of Clinical Nutrition, found that those who ate at least 55 grams of cheese a day — around two slices were 12 per cent less likely to develop type 2 diabetes. The risk fell by the same amount for those who ate 55 grams of yoghurt a day. For years National Health Survey guidelines in the UK have advised against eating too much dairy, cake or red meat as they are high in saturated fat. This is thought to increase cholesterol and raise the risk of diabetes. Researchers including academics

from the Medical Research Council, Cambridge said that not all saturated fats are as harmful as others, and some may even be beneficial. One theory is that the so-called probiotic bacteria in cheese and yoghurt can lower cholesterol and produce certain vitamins which prevent diabetes. And cheese, milk and yoghurt are also high in vitamin D, calcium and magnesium, which may help protect against the condition. “We recommend a healthy balanced diet, rich in fruit and vegetables and low in salt and fat. This study gives us no reason to believe that people should change their dairy intake in an attempt to avoid the condition,” Dr. Iain Frame, director of research at a UK-based charity, was quoted by the paper as saying.

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AgriBusiness & Food Industry w October 2012

Health & Nutrition

News Coconut oil good for teeth: Study

oconut oil can act as a natural antibiotic and help fight the sugarloving bacterium that causes tooth decay, according to a new study. Scientists found that coconut oil fights tooth decay and could find its way into toothpaste and mouthwash as an active ingredient. Research showed that coconut oil which had been treated with enzymes stopped the growth of Streptococcus bacteria – a major sugar-loving bacterium that causes tooth decay. Tooth decay affects 60 to 90 per cent of children in industralised countries, the report said. “Dental caries is a commonly overlooked health problem affecting 60 to 90 per cent of children and the majority of adults in industrialised countries,” lead researcher Dr Damien Brady, of the Athlone Institute of Technology in Ireland, said. “Incorporating enzyme-modified coconut oil into dental hygiene products

would be an attractive alternative to chemical additives, particularly as it works at relatively low concentrations,” he said. Brady added that his findings could prove to be important considering the problem of bugs increasing resistance to many existing antibiotic treatments. Brady’s experiments were inspired by previous research showing that partially digested milk made S. mutans less likely to stick to tooth enamel. The oils were then tested against Streptococcus bacteria which are common inhabitants of the mouth. Only the enzyme-modified coconut oil showed an ability to inhibit the growth of most strains of the bacteria. It also attacked Streptococcus mutans, an acid-producing bacterium which is a major cause of tooth decay. “Our data suggests that products of human digestion show antimicrobial activity. This could have implications for

how bacteria colonise the cells lining the digestive tract and for overall gut health,” Brady said. He now plans to check if the enzyme-treated coconut oil has any other killer qualities. Their studies are also looking into the workings of antibacterial activity in the human gut. The study was presented at the Society for General Microbiology’s autumn conference.

Indian rice not harmful for diabetics: IRRI Study

ice is not harmful for diabetics, claims a study. Two varieties of rice that are the staple of India’s middle class have now been found to have the lowest glycemic index (GI) — the measure of its ability to raise blood sugar levels after eating — compared to 233 varieties from around the world. A recent study conducted by the International Rice Research Institute and the University of Queensland found Swarna and Mahsuri’s GI levels were below 55. Another favourite among Indians — basmati — too fared well but figured in the middle GI group. Low GI foods are those measured 55 and less, medium between 56 and 69, while high GI foods measure 70 and above. The study found that three of the top 10 rice varieties with lowest GI were being grown and consumed by Indians. “Basmati has higher GI than commonly consumed rice varieties in India, Swarna and Mahsuri. The basmati showed a GI of between 68 and 74. The other Indian varieties were all below 60. This is good news, especially for non-Basmati consumers, which is the general middle class population,” said chief researcher Dr Melissa Fitzgerald.

Chinese rice variety Shen Huang Zhin 2 was found to have the lowest GI (around 45) while a variety in Laos had the highest (92). The main varieties of rice from India and southeast Asia which were tested includes Swarna, Mahsuri, MTU1010, Yamini and basmati from India, Pakistan and Bangladesh and BG92 from Lanka. “We now know rice isn’t that evil. It does not cause diabetes. However, this study will help diabetics to select rice varieties wisely,” Dr Fitzgerald said. “Rice is high in carbohydrates which is needed for energy. Those with high physical activity like sportspersons need carbohydrates. But if a person leads a sedentary lifestyle, high energy isn’t required and hence rice consumption should be reduced.”

AgriBusiness & Food Industry w October 2012

Commodity

News

Basmati exporters reap high profits

asmati exporters' profits have surged for the June quarter over the corresponding period last year on higher shipments and prices. Almost all large players saw a significant growth in their topline mainly due to robust demand from traditional markets in West Asia and also aided by a weaker rupee. The profits of KRBL Ltd, the country’s largest basmati exporter, more than doubled to Rs 56.60 crore for the June quarter on higher overseas demand. Another large exporter, LT Foods Ltd, also saw profits double to Rs 7.72 crore. But, Kohinoor Foods' profits dipped by a fourth on account of higher finance costs and other expenses. “Our profits could have been higher, but for the forex

losses of Rs 16.95 crore,” said Anil Mittal, Chairman and Managing Director of “The price of basmati is $1,000-1,500 a tonne for different varieties this year, while last year it was close to $800-900 a tonne,” said Vijay Arora, Chairman and Managing Director, LT Foods Ltd. “Iran is coming up as a big importer and we are now scouting for new markets in the world. We have also signed up few distribution partnerships in Africa, which will further increase our sales in international markets,” Arora said in a statement. The country’s basmati shipments in 2011-12 surged 45 per cent to touch a record 3.21 million tonnes against 2.18 mt in the previous year. In value terms, the exports for fiscal 2012 were up 46 per cent at Rs 15,450 crore against Rs 9,600 crore.

The Government’s recent move to scrap minimum export price, resumption of direct shipments to Iran — the largest market — and China’s decision to import Indian basmati could further accelerate the export of the aromatic rice. Iran, Saudi Arabia and the United Arab Emirates were the large three markets for the Indian basmati during 2011-12.

Govt plans to release 60 lakh tonnes wheat

uch to the respite of millers and food manufacturers facing wheat crunch, the government is planning to release 60 lakh tonne wheat in the open market this financial year. The government’s godowns are overflowing with grains due to a record carry-forward stock of 20 million tonne and further procurement of 38 million tonne. We will start with releasing 10 lakh tonne next month. Commission for Agricultural Costs and Prices (CACP) has recommended offloading 10 million tonne wheat from the government’s godowns this year, said a senior food ministry official.

The government had earlier decided to sell 3 million tonne of wheat in open market in this financial year. The move is likely to ease the supply pressure. Spot wheat prices have risen by 15% over a week to Rs 1,700 a quintal in most of the markets. Traders are diverting stocks for export as the international prices have moved to $311-$ 325 a tonne on drought in US and Russia Millers are to be blamed for the price rise. They refrain from purchasing wheat during the procurement season thinking they will get it cheaper after the government stops buying. Now traders and farmers are holding stocks creating scarcity which is jacking the prices, the official said. He said that the government has so far released 13 lakh tonne of wheat in open market which is much more than the last year when the millers lifted only 12 lakh tonne out of the allocated 15 lakh tonne

AgriBusiness & Food Industry w October 2012

for the year. Allocations should not be based on the past year lifting. Last year the wheat was easily and freely available in the producing states as there was no export option available, said Naresh Ghai, president, Punjab Roller Flour Mills Association. The millers are blaming the government for not releasing sufficient quantity in the market despite sitting on huge wheat stock. They say that high prices of wheat may spike prices of flour and other wheat products like bread, biscuits, maida etc. The government should immediately release wheat for cooling of the prices. We are getting wheat at higher prices due to shortage which will further push food inflation, Ghai said. Millers are also demanding to stop private traders from participating in the tender, which Food Corporation of India invites for selling wheat in the open market. Private traders corner maximum quantity quoting higher prices to ship the grain outside the country. We are being left high and dry, said Ram Chander Singhal, president, UP Roller Flour Millers Association. The food ministry however says that the participation of private traders have eased subsidy burden.

Commodity

News

India to double its spices exports

ndia, the largest spice producer and exporter, plans to more than double exports of spices in five years by persuading importers to ease trade barriers and integrating the value chain from sowing to shipping. "If regulatory challenges are taken care of, exports can easily increase three times in five years," A Jayathilak, Spices Board chairman, said. Spices Board is India's apex body for spice export promotion. India's spice trade bodies, led by the Spices Board, are visiting regulators globally to lobby for realistic import regulations. "Lack of uniform standards hinders fair trade in spices and the varying quality tests create difficulties for the exporters," Jayathilak said. "This also affects farmers, traders and exporters." India has just crossed $2 billion, or more than Rs 11,000 crore, in annual exports of spices. India exports 54 varieties of spices. Importing nations' different standards for essential parameters like volatile oil, extraneous matter, total ash, etc along with permissible levels of pesticides and contaminants is a major hurdle, Jayathilak said. For instance, Middle-East countries permit 30 microgram or ug (one-billionth of a kg) of aflatoxin (a contaminant) in one kg of spice while this limit is 20 in the US, 15 in Canada and 10 in the EU. "We have no issues in conforming to

these regulations, provided the buyers are ready to absorb the increase in associated costs, which, they are not," Jayathilak said. Exporters say many importing countries have different standards for spice coming from two countries. For instance, Europe tests nutmeg imported from India for aflatoxin, while Indonesian nutmegs are allowed without any checks. Traders also complain that in many importing countries, safety regulations are similar for spices and other food products such as milk and apples. "This isn't quite logical," Geemon Korah, chairman of All India Spices Exporters Forum, said. "The average daily intake of milk is easily above one glass while you may have two or three apples in a day. However, the daily consumption of spice is just about 2-3 gm, which is minuscule. Considering this, we are suggesting the regulation levels for spices be lowered," he said. In July, K Chandramauli, chairman of Food Safety and Standards Authority of India, and Philip Kuruvilla, chairman of World Spice Organisation, a non-profit arm of Spices Board, represented India at the annual meeting Codex Alimentarius Commission and pushed for a Codex Committee and uniform standards for spices, aromatic herbs and their formulations, which accepted India's proposal and has requested a discussion

paper on the same, the Spices Board chairman said. Spices Board is also looking to remove unwanted specks in the production and supply chain within the country. As a first step, World Spice Organisation is evaluating a backward integration model to connect exporters, processors, farmers, state government, scientists, and regulatory officials. In this model, farmers will cultivate spices to export requirements while exporters will assure buy-back at a premium through prior contracts. State governments will provide local support, and Spices Board, through its panel of scientists, will provide technical knowhow. World Spice Organisation will co-ordinate and facilitate interaction between all parties.

Onion exports rise by 23 %, but drops in value

nion exports from the country increased by 23 per cent in volume during April-August but dropped in value by 27 per cent during the period. Exports in the first five months have been pegged at 7.9 lakh tonnes against 6.41 lakh tonnes during the same period a year ago. Earnings from exports were pegged at Rs 547.90 crore against Rs 756.50 crore. Shipments increased primarily since they were offered at costs that were 40 per cent lower than last year. For the whole of last year, the unit value of realisation from a tonne of onion was Rs 13,790. This year, the realisation, so far, has been Rs 6,934. The competitive offering of onions has been possible mainly since the Centre lowered the minimum export floor price (MEP) for onion to $125 a tonne since April. During the same period last year, the MEP ranged between $200 and $250. A feature of this yearâ&#x20AC;&#x2122;s export has been

that shipments were over 1.5 lakh tonnes every month, barring August when it dropped to 1.39 lakh tonnes. One reason for the drop was buyers placing lower orders in view of monsoon, while poor quality of arrivals was another reason. August and September are periods when exports slow in view of monsoon. Also, it is when farmers generally tend to run out of stocks or would prefer to push only those grades that are vulnerable to damage. Expectation of the new crop that generally arrives during September-end in the market also adds to the factor. According to export sources, there has been a constant demand this year from the Gulf countries in particular. In addition, there has been good buying from FarEastern nations, especially Indonesia. The Centre had begun fixing the MEP to check exports which were seen as a primary reason for onion prices soaring

to over Rs 100 a kg in retail outlets during December 2010 and again in February 2011. In fact, the Centre had banned exports in January 2011 before removing it in February following protests from growers. Onion production during 2011-12 was a record 15.39 million tonnes against 15.11 million tonnes the previous year. Of this, Maharashtraâ&#x20AC;&#x2122;s contribution was 5.03 million tonnes (4.9 million tonnes) during the period despite the area under the crop being lower.

AgriBusiness & Food Industry w October 2012

DAIRY

Verghese Kurien 1921-2012

Tribute to India’s Milkman Hailed as Father of India’s White Revolution and endearingly called ‘Milkman of India’, Dr Verghese Kurien was credited with having pioneered the milk cooperative model at the village level – widely known as Anand cooperative model. He transformed a sleepy town in Gujarat into a milk capital of India. Having founded the Anand Milk Union Ltd – which gave rise to the acronym ‘Amul” –Kurien went on to take India to the position of world’s largest milk producer. Thanks to Operation Flood, world’s largest dairy development programme, which Kurien launched under National Dairy Development Board (NDDB), India’s milk output has gone up six-fold – 123 million tonnes from just 2 milliion tonnes in 1960. The Gujarat Cooperative Milk Marketing Federation (GCMMF), which markets Amul, began with just 2 village dairy cooperatives societies and 247 litres of milk. It has since taken a giant leap to become India’s largest food product marketing organization with an annual turnover of Rs. 11,668 crore. The daily milk procurement is in the range of 13 million litres from 16,117 village milk cooperatives. 17 member unions, covering 24 districts and 3.18 million milk producing members. Amul’s product folio consists of milk, butter, cheese, ice cream, ghee, chocolates, milk powder, baby food and what have you. It exports milk products worth Rs. 95 crore. Among his manifold contributions to the dairy sector, Kurien would always be remembered for empowering the farmer and for having made a serious efforts to professionalise rural cooperatives. Eminent farm scientist Dr M S Swaminathan has described as “monumental” Kurien’s contributions to development of Indian dairy development, “rooted on the Gandhian principle of production by masses.” He transformed a small-scale household activity into the world’s largest milk producing enterprise.. In a moving tribute to him, NDDB, says, “Thank you for giving us a dream. Thank you for showing us the way. Thank you for guiding us to better the lives of millions of farmers. As we remember all that you have done for us, we remain dedicated to pursuing and achieving your vision. We remain committed to reaching out to many more lives.”

Visionary extraordinaire – Dr. M. S. Swaminathan

met Dr. Verghese Kurien soon after his return from Michigan State University and his taking up residence at Anand. From then on, we shared ideas and experiences in the area of rural transformation through agriculture and dairying. Among the very many unique contributions of Dr. Kurien which led to India becoming the leading milk producer of the world, I would like to highlight a few.

Decentralised production First, he rightly concentrated on the processing, pricing and marketing aspects of milk production. He knew that if dairying became profitable, farm women and men would automatically care for the animals and look after breeding and nutrition. He also knew that in our country, only a decentralised production of milk, done by women, supported by key centralised services in the fields of animal nutrition, health care and processing would help to ensure both the income security of rural families and the production of the necessary

AgriBusiness & Food Industry w October 2012

quantities of milk for the country. He therefore saw great merit in the power of cooperative milk societies in conferring concurrently the advantages of production by the masses and the benefits of modern centralised dairy processing technology. He developed a “one stop” method of meeting the needs of over 75 million women engaged in milk production. Thus, the Amul cooperative units not only purchased milk but also provided breeding, health care and nutrition support for the animals, to the great benefit of the milk suppliers. Thanks to Dr. Kurien’s

Dairy

News emphasis on payment based on butterfat content, the buffalo started getting attention once again. The survival of milch buffalo breeds and their dominant role in the dairy industry today is primarily because of the milk purchase and pricing procedures introduced by Dr. Kurien. Processing and marketing His other major contribution was the diversification of processing and marketing channels. Thus, milk became available through bulk vending machines, as well as through direct home delivery procedures and distribution through sachets. Such a multiple delivery channel made it easy for consumers to get milk whenever and wherever needed. Dr. Kurien ensured the economic viability of milk processing plants by deputing multidisciplinary spearhead teams to assess the quantity of milk available in an area and the capacity needed for the optimum functioning of the processing plant

before it was established. When milk became available in plenty, he diversified the product mix by converting milk into milk powder. He also ensured a steady supply of milk throughout the year by the judicious combination of milk powder and raw milk. Above all, he developed a unique system of training potential dairy managers through the organisation of a Siksha Dairy at the Anand Agricultural University, designed to impart training in all aspects of the dairy industry, ranging from milking the animal to processing, value-addition and marketing. IRMA A lasting contribution of his was the establishment of the Institute of Rural Management at Anand to provide the country with well trained and competent managers for handling rural enterprises including dairying. I was the Principal Secretary in the Union Ministry of Agriculture when the inspiring report prepared by Dr. Kamala Choudhary

A Titan & Visionary A

mrita Patel, Chairman of National Dairy Development Board, described the architect of India’s White Revolution Verghese Kurien as a Titan and a visionary who promoted and established nearly 1.50 lakh village cooperatives with 1.50 crore members across the country, leading it to emerge as the largest milk producer in the world. Paying glowing tributes to her predecessor, she said this was no mean feat and his dream would continue to inspire millions in the years to come. “It was his singleminded determination against odds that would have overwhelmed a lesser mortal and the vision that he steadfastly strove to achieve that made this possible.” Patel said the doyen of Operation Flood strode like a Titan across the bureaucratic barriers and obstacles that, at every stage of NDDB’s history, could have brought it to its knees. “Undaunted, he stood staunchly against all the machinations of those who beheld his achievement with envy and were affronted by the sheer tenacity of the man. The sense of professionalism, integrity and his constant search for excellence in everything that he did, Dr Kurien set an example for those who followed him to live up to. He had an extraordinary ability to convert threats into opportunities, never letting an opportunity to pass him by that could be of advantage to the organisation or those it served.

and Dr. Kurien came for approval. This was the first time that a serious attempt was being made in our country to professionalise rural cooperatives. Looking back, it is difficult to believe that one person could have achieved so much in his lifetime, transforming a smallscale household activity into the world’s largest milk producing enterprise. More than for any one else, the following description of an extraordinary individual by Rainer Maria Rilke fits Dr. Kurien. “Again and again in history some special people in the crowd wake up. They have no ground in the crowd, and they emerge according to much broader laws. They carry strange customs with them, and demand room for bold actions. The future speaks ruthlessly through them. They save the world.” (Dr. M.S. Swaminathan, renowned agriculture scientist, is popularly known as Father of India’s Green Revolution)

Amul Girl Weeps for the First Time

a y i n g homage to father of white revolution in India Dr Verghese Kurien, who catapulted India from being a milk-deficient country to the world's largest milk producer, 'Amul's' mascot for the first time ever was seen weeping (since 1964) in an advertisement. "Thank You For Giving us Hausla, Pragati & Anand......Dr V Kurien 1912-2012," the ad released by Amul's advertising agency DaCunah Communications read. The ad shows the young iconic Muppet, usually attired in polka dot frock and shown smiling, draped in a saree and weeping, with two ladies standing alongside. It was released on the official website of Gujarat Cooperative Milk Marketing Federation (GCMMF), thanking the 'Father of White Revolution' for his contributions. Kurien, who passed away yesterday, played a key role in formation of Amul, which broke the local trade cartel 65 years ago, paving way for the dairy co-operative sector to flourish in Gujarat. He served GCMMF from 1973 to 2006.

AgriBusiness & Food Industry w October 2012

DAIRY

News Farmers in dry areas are selling more milk

he prevailing drought-like situation in parts of the country has led to farmers selling more milk in the market. This is reflected from the 10-25 per cent rise in milk procurement that co-operatives and corporates have registered largely from the dryspell hit areas. The Gujarat Co-operative Milk Marketing Federation (GCMMF), the largest milk co-operative that owns the Amul brand, has registered an average increase of 16 per cent in daily milk procurement, said R.S. Sodhi, Managing Director. Large parts of Gujarat, where the GCMMF operates, have been hit by the dry spell this year. Farmers tend to sell more of milk, which becomes the only source of income when crops are hit by poor rains, Sodhi said. The average daily milk procurement by GCMMF stood at 10.30 million kg in 2011-12. “The surplus trend in milk output

that the country witnessed last year still continues,” said R.G. Chandramogan, Chairman and Managing Director of Hatsun Agro Product Ltd, a Chennaiheadquartered dairy products company. Hatsun, which also operates from parts of Karnataka, has registered a 23 per cent rise in milk procurement in July to over 2 million litres from 1.625 million litres in corresponding month last year, Chandramogan said. The increase in prices offered by the dairies last year to the farmers is aiding the procurement trend. However, in southern parts of Maharashtra milk production is estimated to be down by about a tenth on poor rains in the region where fodder and feed scarcity looms large. “Production is down by 5-10 per cent, but it is not that visible. However, our procurement has gone up by 10-11 per cent,” said D.V. Ghanekar, Managing Director of Kolhapur District Co-operative Milk Producers Union, which sells milk products under Gokul brand. “Our

procurement has gone up by 60,000-70,000 litres per day (LPD) to 6 lakh LPD,” he said. “The growth in milk output may largely remain same as that of last year, but the procurement goes up normally in the first year of drought, as it becomes the only source of income for farmers when crops fail,” said R.S. Khanna, dairy industry expert. He estimates the country’s overall milk production to sustain a growth of 3-4 per cent this year too. The Government is yet to officially announce milk production numbers for 2011-12, while the output stood at 122.8 million tonnes for 2010-11.

Parag Milk Foods to get investment from IDFC

DFC Private Equity Fund III, managed and advised by the private equity group of IDFC Alternatives Ltd (previously known as IDFC Private Equity), has invested Rs 155 crore in Parag Milk Foods Pvt Ltd. Proceeds from this deal will be used to build capacities in various product lines, strengthen its procurement infrastructure and provide a part exit to existing investor, Motilal Oswal Private Equity, which has invested in the company in 2008. This is IDFC PE’s first investment

in the dairy sector and the second in rural infrastructure. According to Girish Nadkarni, Partner at IDFC Alternatives, Parag touches the lives of more than one lakh farmers. The Rs 880-crore Parag is one of the leading private dairy companies in the country and markets its products under the ‘Gowardhan’, ‘GO’ and ‘Pride of Cows’ brands. It has a market leading position in cheese and ghee segment among the pizza chains. The company processes close to 11 lakh litres of milk per day across its two plants in Manchar near

100AgriBusiness & Food Industry w October 2012

Pune and Palamner in Andhra Pradesh. Parag has the largest cheese plant in Asia with a capacity of 40 tonnes per day. IDFC Alternatives, which manages funds of $2.2 billion, is a wholly-owned subsidiary of IDFC Ltd and one of the largest infrastructure focused private and project equity investors in India. IDFC Private Equity, a part of IDFC Alternatives, manages funds of Rs 5,700 crore ($1.3 billion) across three funds. Over the last eight years, IDFC PE has made 34 investments and has had 18 liquidity events.

Dairy

News Vimal Group to launch dairy alternatives

hmedabad-headquartered Vimal Group will launch dairy alternatives for Indians who are vegans or are simply lactose intolerant. Vimal Oil and Foods Ltd will launch an entire portfolio of dairy alternative products in 2013. "The category will target consumers who wish to substitute milk with nondairy alternatives in their diet," said Jayesh Patel, CMD of Vimal Group. The Group will launch tofu to substitute paneer, soya cheese and rice cheese to replace cheese, margarine to replace butter, soya cheese spreads against cheese spread and soya mozzarella against mozzarella. Plant milk that goes into making of dairy alternative products could be derived from soy, oats, nuts, seeds, legumes, hemp, rice, et al. The Indian market for dairy alternatives is below Rs 100 crore against the dairy industry that the industry chamber ASSOCHAM peg at Rs 5 lakh crore by 2015. "Consumers do not compromise on taste. Efforts have been on to push soya milk in the country since last three decades without much success," said RS Sodhi of the Gujarat Co-operative Milk Marketing Federation that owns the $2.4 bn co-operative dairy brand Amul. Amul is present in almost the entire

range of dairy products and believes that dairy alternatives will not harm to the category. "But the companies concerned must be open about the ingredients and should inform the consumers that the products do not contain milk," Sodhi asserted. Another Vimal Group company Vimal Dairy Ltd sells dairy products under the Vimal brand. Patel says the company would sell the dairy alternatives under a Vimal sub-brand. "In developed markets like the US and EU, increasing number of consumers (except children) are avoiding dairy products due to health awareness. They see dairy alternatives as a healthier option. In future, Indians too would start looking for dairy alternatives," Patel reasons for plunging into the category. About 60% of 123 million tonnes milk produced in India is consumed in liquid form, while the rest is consumed in the form of butter, clarified butter (desi ghee), cheese, curd, paneer, ice cream, dairy whiteners and traditional sweets. In the US and EU markets, dairy alternatives sell more than dairy products. "Health consciousness played a pivotal role in the growth of alternative dairy in Western market," said Deloitte's senior director Gaurav Gupta.

Although Indian alternative diary market yet to make an impact, developed markets like the US has seen total retail sales of soymilk, almond milk, rice milk and other plant milk reach $1.33 billion in 2011, as per US-based Packaged Facts on "Dairy Alternative Beverages in the US". Gupta sees Indian consumers resisting a shift from dairy to dairy alternatives. "But, it will gradually happen when people become more health conscious. Others to shift would be those allergic to milk based products," he said. As per the US Packaged Facts report, more than half (54%) of US' adults buy soymilk due to its nutritional characteristics and other half do so because of nutritional advantages related to the need of a specific personal or household health concerns. Health issues including lactose intolerance, milk allergy and the genetic disorder phenylketonuria can be addressed through the consumption of dairy alternative beverages because these plant-based milks are free of animal proteins, in particular casein, it states.

pouches in Delhi. The total market for pouched milk in Delhi is estimated at 50 lakh litres, where Amul sells about 22 lakh litres. DMS has around 350 to 400 milk vending booths across Delhi and operates dairy plant with a processing capacity of 6 lakh litres per day. The acquisition of DMS will augment Amul’s direct presence in Delhi and also expand its processing capacity.

Delhi is the largest market for Amul, where it has grown its pouched milk sales to around 22 lakh litres per day from around 25,000 litres about six years ago, said R.S.Sodhi, Managing Director, GCMMF. Amul has a processing capacity of 12 lakh litres per day in Delhi, while it expects to add capacity of another 50 lpd as it is under process of setting up two dairies in Delhi and Rohtak.

Amul to buy DMS

ujarat Co-operative Milk Marketing Federation Ltd, which owns the Amul brand, has expressed its willingness to acquire the Delhi Milk Scheme (DMS). DMS, under the Ministry of Agriculture, is a loss making entity and has about 5 per cent share in the pouched milk segment in the national Capital. “We are making a proposal to the Agriculture Minister Sharad Pawar to take over the DMS operations,” said Vipul Chaudhary, Chairman, GCMMF. Chaudhary recently took over as the Chairman of GCMMF. He was speaking after launching Amul’s newest product Moti, the ultra-high temperature (UHT) treated milk in aseptic poly packs in New Delhi. Launched in 1959 with an objective to provide milk for Delhi citizens, DMS has been running into losses for the past several years. Industry sources said DMS currently sells around 3 lakh litres in

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