Oil & Food Journal - August 2014

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Indian QSR Industry Pg 09

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Contents

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52

Coca-Cola to invest additional $5 billion in Africa

Pepsi introducing juice from cashew apples in India

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Telangana stake full-scale on food processing sector

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TGB announces guidelines to sustainable beverage production and consumption

FSSAI elucidate that Ghaziabad Food Testing Lab is not closed

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Genetically ‘edited’ Fruit may be an answer to consumers’ GMO woes

38 Palm Oil slide to 1-year low

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320,000 jobs can be generated in Uttarakhand by food processing

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McCain Foods to close Canadian French fry facility

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5th edition of Food & Bev Tech 2014

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India in quest of amendments to subsidy as it would hit food aid

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Markem-Imaje launches the 9028, a new inkjet printer offering simplicity and autonomy

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Lindt pulls out of India weary over FSSAI’s import issues

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Sanwaria Agro plans on 60 per cent revenue in 3 years from its branded segment

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Confectionery developers benefit from ddw’s oil dispersible colour technology

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K Global Ventures to develop palm oil plantation in Guinea

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Lay’s® Canada announces 2014 Do Us a Flavour™ finalists

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National Best Entrepreneur Award’ in food processing for this Woman

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Indian dairy sector dead against free access market access to New Zealand

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Vol. 09, Issue 10, August, 2014

Editorial

From the Desk of Editor

he food industry and the importers in India are facing destitution from the Food Safety Authority of India (FSSAI). There food regulations imposed by the safety authority seems to hit drastically on the business of the industry, exporters and importers.

The thing is not as complicated as the FSSAI has made it. The story goes like this …..Exporters to India often use stickers on their products to comply with rules and regulations. Importers fear they would get a short window to sell their products. Foodstuffs imported to India get stuck at the Indian seaports and airports due to Food Security and Safety Authority of India’s (FSSAI) zero-tolerance policy towards non-compliance of its regulations. The imports mainly contain chocolates, nutritional supplements and also include other food items such as snacks.

According to industry estimates, imports worth between Rs 500-Rs 750 crore are stuck due to a stand taken by the authority. Custom authorities at ports and airports have blocked the consignments saying that all labeling information should be printed on the packaging itself and that an affixed sticker is no longer permissible.

The stance of the authority has affected food import. There are many consignments lying at the ports. Food items have a short shelf life - often between one to one-and-half years. This is a growing concern among importers as they would get a short window to sell their products, even if it went past the customs.

Importers are becoming tired by the attitude of FSSAI. Some big companies are pulling out just because of the FSSAI’S attitude. Lindt, arguably the most popular imported chocolate in the country, has decided to shut shop in India after two of its consignments were sent back due to non-compliance with new rules imposed by FSSAI).

It is not chocolates which is facing the brunt of the FSSAI’s labeling orders. Containers of apples and other fruits, olives, canola oil, beer, wine, spirits, chocolates, fresh meat, seafood, pasta-sauce, mayonnaise, candy, juices, chips, spices, soymilk, gluten-free products have been blocked at various ports.

The industry has reached the last of this force, and many multinational companies like StarBuck, wine industry and nutraceutical industry turned towards the Indian Judiciary for help.

In fact recently the Bombay high court has issued notice to FSSAI asking it to respond by September 1 on whether they should insist on labeling Canola Oil as “Rapeseed Oil-low erucic acid”.

The court has also asked FSSAI to proceed with the import clearance procedure of drawing samples for testing and issuing no objection certificates for Canola oil containers blocked at several ports.

Importers of Canola oil have faced with an uncertain future after the FSSAI order, asking them not to import the edible oil under the brand name.

The authority has insisted that the every container of Canola oil must be labeled as “imported rapeseedlow erucic acid oil”. It has also asked importers to print an ingredient list with “edible vegetable oil” (not Canola oil) and include it in the label. Importers say it would be difficult for them to sell Canola oil with the “imported rapeseed-low erucic acid,” label.

The standoff has proved costly for the importers as hundreds of containers of Canola oil have been detained across various ports.

Several representations to the FSSAI have pointed out that Canola oil has been imported and sold in India since 2007 and it is a well-known product. It is one of the largest selling oils in several countries, including US, Canada. Mexico, Australia, Japan, China and Pakistan.

The Indian Judiciary has warned FSSAI on many instances and even flogged it for misconduct. Countering the allegations FSSAI, has appealed in the Supreme Court that the food authority had been handicapped from examining any food product due to the stay by Bombay High Court order, stating that the order was affecting the entire industry and that the entire food safety mechanism had been rendered ineffective.

Supreme Court has refused to lift a stay order imposed by the Bombay High Court on the Centre’s proposed new legal regime for food products under which Food Safety and Standards Authority of India (FSSAI) had been tasked with providing new approvals for food products already in the market by different manufacturers.

The Supreme Court in its ruling however had also pointed out that the Bombay High Court stay order was only interim solution and the legality of the advisory was still to be decided upon, calling on the government to wait for the final verdict of the Court.

Food safety is important and no doubt FSSAI’S job is important, but such arbitrary Acts by the food authorities has adversely affected various sectors of food industry, especially in the states like Maharashtra, Gujarat, Karnataka, Madhya Pradesh, Himachal Pradesh and Tamil Nadu.

Food safety authority is to protect the public from low standard, poor quality and spurious food products, but that does not mean it has the right to stalk the food industry on various erroneous issues and matter. High time for them to properly demeanor their authority.

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Indian QSR Industry

Opportunities and Strategies to Harness Them

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ntroduction Indian QSR Industry is growing very rapidly. It is a reflection of the change in the lifestyle, food habits and consumption pattern of the population.

The incidence of Dining out, ordering from home as well as takeaways is rising creating an opportunity to cater to a wide mass of population. What was the

domain of upper class, singles or forced bachelors, has percolated to all echelons of society. The incidence and value differ substantially, but penetration of such consumption habits is wide spread and is on the increase. Although largely an urban phenomenon, the pattern is also emerging in rural areas with better road connectivity, increased vehicle ownership

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and rise in income levels.

In a country with more than a billion people, opportunities in India are abound.

This has led to a rapid growth of the QSR industry. However, simultaneously, it has also created a canvass that has many failures and carcass. Several outlets have been closed, a large number are

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struggling, still a large number are just about surviving and lot many of them have not been able to find their feet. There are a lot who are successful, but, more importantly, there is almost a complete absence of national chains, except of two cafes, three – four international chains and a few regional chains. Even these are very recent phenomenon and many of them are struggling.

This indicates to the fact that just having a lot of opportunities is not enough.

These opportunities need to be harnessed and converted into profitable enterprises.

This paper is an attempt to understand the industry, its key success factors and draw a framework for developing a road map for success.

This report focuses on the urban population, even though a large population lives in rural area. In no way does this report wish to ignore the potential. It is just that urban markets tend to offer better opportunity due to the lifestyle of the customers as well as concentration of demand.

The Market The Indian consumers are portraying an ever changing lifestyle, one of the key characters of an emerging economy. The phenomenon takes a new meaning when a large proportion of population is young and very receptive to new ideas, products and services.

In 2011, India’s Gross Domestic Product reached Rs. 91.7 trillion. It increased significantly from Rs. 62.6 trillion in 2006. The per capita disposable income increased from Rs. 48,267 in 2006 to Rs. 61,591 in 2011. The per capita spending also increased from Rs. 34,713 in 2006 to

Rs. 44,462 in 2011.

India is a very young country. People between the ages of 18 - 35 contribute a significant proportion. This is also the spending years, food and lifestyle and hence QSR. In the top 10 cities this population also shows more discretionary spending, usage of credit cards and changing eating habits. About one thirds of them constitute the top layer consisting of SEC A and B who are educated and are professionally employed. The NCAER reports call them as Achievers and Aspirants. There is also an increase of the share of leisure and lifestyle spending in the PFCE of the Indian population.

In 2011, the number of Indians above the age of 60 years-old was about 93 million, representing 7.6 % of the total population. This proportion is expected to increase to nearly 10% by 2020. Since many of these are more educated and have greater financial independence, they are spending time recreation and fitness activities, travel, and entertainment.

About 15% of the total labour force has regular salaried jobs. While employment in the public sector grew at just 0.4% between 2010 and 2009, private sector employment grew at 4.5%.2 Organised and new industries have shown an increase in job creation especially in manufacturing, banking and finance, IT, pharmaceuticals, media and entertainment, online business, mobile services, healthcare services, health insurance and the hospitality sector.

There is also an increase in the proportion of women work force in these industries.

Long working hours, especially among those in management, is common, especially in private sector. Also in large cities, workers tend to commute.

According to Payscale, a US-based salary tracking firm, Indian workers spend more time commuting as compared to many very large cities like New York. Commutes in Mumbai, Delhi and Bangalore spend on an average 47.5 minutes, 43.6 minutes and 40 minutes respectively. Most workers bring lunch from home, though with hectic work schedules and busy work life the incidences of dining at foodservice venues nearby their offices are increasing.

EATING HABITS

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Quick Serve Dining In The per capita expenditure by Indian consumers on food and non-alcoholic beverages between 2006 and 2011 has grown by 3.6%. Indian households follow the traditional dining culture which places great value on freshly prepared meals.

They eat traditional foods and cook fresh at home for every meal. Vegetables and meats are bought fresh. Meals are prepared fresh every time. A large number of Indian consumers still prefer vegetarian dishes though the demand for non-vegetarian food is on the rise in India, even among conservative households. Indian cuisine is wide-ranging and diverse. Different regions have clearly differentiated tastes and preferences. In recent years consumption of processed and packaged foods has grown strongly in urban areas more affluent households with working women. The number of such households is large but consumption is still very low. Indian consumers often celebrate at home over home cooked meals. This is especially true during religious festivals.

The main meals as well as the desserts and special celebratory food items are still typically cooked at home. Ordering in is also on the rise. Among the SEC A, B and C households in large cities, more than 25% ordered in for more than 5 times in a month, 20% once a week and 22% once a month.

There is a strong preference for Indian flavours and cooking styles. The interest in international dishes is on the rise but most Indian consumers continue to prefer Indian-style dishes. The more popular international cuisines include Chinese, Mexican, Thai, and Middle Eastern. In a large number of cases international dishes are prepared with Indian spices to suit to the local pallets.

Snacking Habits Snacking is very popular in India. There is a preference for salty, sweet and savoury snacks rather than chocolate, confectionery and ice cream. Popular sweet/savory snacks include potato chips/ crisps, extruded snacks and traditional snacks such as crisp Bikaneri bhujia string-like fried sev and chivda. Although most traditional sweet/savory snacks consumed in India are unpackaged or homemade, the share of packaged

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traditional snacks has seen a significant increase in demand. In recent years, there has been a broadening of the range of snacks flavoured with popular Indian flavours. Instant noodles have become a very popular snack for kids. There is an increase in the proportion of bakery products, especially cakes and pastries.

Snacks also are high on the choice of customers when ordering in at home or office.

Drinking According to a study by the World Health Organisation (WHO), a smaller proportion of Indians consume alcohol compared to consumers in Western countries.

Approximately 67% of males and 92% of females in India are lifetime abstainers. Consumption of alcohol in India is increasing as opposed the trend in many Western countries. This has been driven by rising disposable incomes and greater acceptance of consuming alcoholic beverages by the society. The per capita consumption of alcohol in India increased from 3.3 litres in 2006 to 5.4 litres in 2011. Times of India said “Indians love their whisky, vodka and rum but are yet to develop a taste for wine. An average Indian adult (15 years and over) drank 2.6 litres of ‘pure alcohol’ between 2003 and 2005.

This was higher than the per capita consumption in the south-east Asia region which stood at 2.2 litres. For every six men, one woman drinks alcohol in India.”

Outside of the homes, alcohol is consumed in restaurants, beer bars, pubs, clubs and discotheques. Many restaurants mark off separate areas called ‘permit rooms’ which accommodate the sale of alcohol. According an article on nightlife in India on website goindia.about.com, “the country’s bars tend to be divided into two categories: cheap, seedy local bars frequented by India’s male population and classier venues catering to the progressive middle- and upper-class crowd. The latter can only be found in major cities”. The site adds “An interesting term used in India is that of the ‘resto-pub’ or ‘restobar’. These are restaurants that double as places where you can drink, and sometimes dance later in the night, as many restaurants don’t serve alcohol in India”.

Per Capita Consumption of Alcoholic Drinks and Soft Drinks by Category in 2011 Source: Euromonitor International Dining Out Dining out has seen explosive growth in recent years as urban consumers seem to have found more occasions to celebrate and more opportunities to dine outside the home. Birthdays, wedding anniversaries, graduation parties, Valentine’s Day celebrations, reunion parties and many more occasions are celebrated by dining

out, at least by affluent consumers.

According to the India Leisure and Entertainment Report by the Knowledge Tree company, dining out is now one of the three most popular recreational activities among Indian consumers. This is also due to lack of space in most urban dwellings. According to a 2011 study on Indian consumers’ attitudes toward dining out conducted by the US Department of Agriculture (USDA), traditional eating habits in India are changing and consumers who traditionally always ate at home are now increasingly dining out.

Busy urban workers often pick up a quick breakfast from street stalls located close to office; lunch (and often dinner, too) is often purchased from stalls close to office.

But while the vast majority of dining out consists of purchases at street stalls, restaurants have nevertheless accounted for a rapidly growing share.

According to the USDA report, dining out in India used to be reserved only for special occasions but increasingly younger consumers and consumers from middle- and upper-income households are dining out more often. Many have shed the biases often held by older and more traditional consumers regarding

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Quick Serve the quality of international franchises and foreign foods in general.6 Many international chains such as McDonald’s, KFC and Domino’s Pizza, BaskinRobbins and Indian chains like Haldiram, Nirula’s and Bikanerwala have evolved.

These are modernised with menus and service to compete with the leading outlets. According to an industry journal Express Hospitality, the main dining out trends are contemporary Indian, Asian street food and grill, Pan-Asian cuisine and gastro-lounge-bars that focus more on their food offerings with sparse décor.

The three major trend in the cuisine are growth of regional Indian food, chefled innovation into fusion cuisine and popularity of international food and styles.

Going Out One of the most common activities in both urban and rural areas is going to the cinema. It is also one of the more affordable entertainment options.

Another common (and affordable) activity is going on picnics at nearby parks, beaches or other locations of interest. An article on leisure trends in the Times of India mentioned that the increasingly busy pace of urban living in India is driving a greater appreciation of ‘down time’ in the country and consumers are becoming more and more willing to spend money on relieving their stress.

A tourism website india-hotel.net notes that “As a rule, traditional Indians did not use to believe in nightlife and its associated activities. However with Western influences and work ethics coming in, the rules of the game have changed. Most big towns and cities have pubs and discos that are open all through the week. Even then the major crowds will only surface on the weekends yet from time to time some events are organized which will draw in the crowds”.8 Cities such as Mumbai and Delhi offer a wide range of nightlife activities and venues.

These include restaurants clubs, lounge bars and discotheques. Indians typically go out on a weekly basis but some go out more often. The night life is still restricted and regulated. According to website goindia.about.com, “In most cities in India, nightlife is early to start and early to end because of the curfews in place.

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While Mumbai may have the biggest selection of party places in the country, come 1.30 am they’re all starting to close for the night. With a few exceptions, the scene is similar in Delhi and even worse in Chennai, Bangalore and Hyderabad which have 11pm or 11.30pm curfews.

Even in Goa, most places are forced to close by 10pm due to noise restrictions.

Many venues have found that the solution to the curfews is to open during the day or early evening. A ban on dancing was introduced in Bangalore in 2008, but it was finally removed in late 2011 after a series of protests”.

Café Revolution Although, tea shops serving fresh and affordable tea are in large numbers and are located very conveniently, in recent years the number of cafés has grown significantly catering to urban affluent consumers. These consumers are younger consumers influenced by western dining and drinking trends. These cafés are considered as joints or addas to relax and to escape from the stress of urban living.

The posh Western interiors, good music and attractive lighting make cafés very interesting places for young consumers to spend their time. They also offer food and other beverages such as tea and juices. Increasing base of credit/debit card holders is also fuelling growth in eating out market. It is estimated that 25 million people were using cards for money transactions in 2008 and the growth is poised 20-25 per cent year-on year. Travel, hotel and dining category accounts for 35 per cent of credit card usage.

More than 85% of these are standalones.

The different locations where these outlets are found include retail, leisure, lodging and travel. All these locations are showing growth, but the growth at retail ad travel is much faster. By 2015, these are expected to have about 145,000 and 87,000 outlets respectively, amounting to 12% of total outlets.

The total foodservice market is expected to be Rs. 43,000 crores. The organized segment of the restaurant industry, at approximately Rs. 7,000 crores to Rs. 8,500 crores, forms 16% - 20% of the industry. The size of the industry is expected to be Rs. 62,500 crores by 2015.

The organized segment is growing, at 20 - 25% per annum. The overall restaurant industry (organized/unorganized) is growing at 5% - 6% per annum. The value growth is largely taking away from the standalones. It must be noted that while the rate of growth is slowing the number of standalones would still keep growing,

The Foodservice Industry

Catering to more than 1.2 billion people, the foodservice industry in India is large and growing rapidly. The country is estimated to have more than 2.1 million outlets serving out cuisine that is diverse and appealing to diverse taste buds.

of 43%.

though the value may stagnate, before it starts showing any downward trends.

The chains still comprise a very miniscule proportion of the outlets, though growing at the rate

The QSR segment has shown the fastest growth with a value growth of 15% - 20% in both 2006 and 2007.

Per Capita Expenditure on Consumer

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Foodservice by Chained and Independent (2011) Source: Euromonitor International Competitive Landscape The industry has high potential. It is also showing high growth. However, it is also witnessing high competitive intensity.

This happens because the entry and exit barriers are low in the industry. Even though there are failures, more and more new outlets are started as the market is witnessing growth.

The reasons for entering into this business are several. It is found that a lot of enterprises are more out of the glamour.

Many enter into this industry to give their children or spouse an employment. They treat the investment as a ‘gift’ and are not expecting return.

If it succeeds, the children are ‘settled’; else they would find some other employment.

The premises, if bought, is seen as a creation of asset, hence no risk. A large number of these outlets are started by chefs or those with hotel management background. While they have the culinary expertise and have worked in some establishment, they are entrepreneurs by nature. The focus on food and culinary expertise is more and limited on the business essentials and hence when faced with difficult time, they tend to go asunder. The other group consists of people from the real estate fraternity who have set up property and make food courts integral to the property.

Their return expectations and revenue source is rent and not sales revenue.

This makes the competitive landscape

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as complex as some of the Indian Dishes where despite knowing the recipe, once is not able to get a great dish.

Another factor that leads to competitive intensity is the cost structure of the business. Most of the costs in this business are fixed, such as premises, fixture, personnel, lighting, air-conditioning, and municipal taxes. These are not linked to the sales. Hence, even when the outlet is not performing, the cost of continuing is small. The fixed costs are considered as sunk and like airlines business, even when only the operational costs are covered the enterprise keeps going. The continuance of such outlets, even though not very profitable, attracts more enterprises. With the competitive pressure, there is pressure on margin. Since revenues cannot be increased so easily, the efforts are towards cost cutting, subjecting the outlet to a downward spiral, leading to closer after a long suffering. But till they survive, and there are many of them, the market remain highly competitive.

The organised sector takes a different route. They start with a larger capital investment and hence have higher breakeven point. They require a large number of customers with higher level of spending in every visit. Since the customers are variety seeking and the frequency of eating out is not very high, the number of customer required to make profitable business increases substantially. As they tend to use mass media communication, the novelty of the outlets draws a lot of customers. There is also a higher level of frequent repeat visits. However, unless managed well, in a large number of cases, sales dip after hype. Most outlets are not prepared for this dip and take to kneejerk reaction of increasing sales, losing margins in the process. Also a hugely successful launch brings competition faster and the available market suddenly shrinks. Outlets tend to drop prices, offer value packages or increase communication efforts.

All these lead to lower profitability, even though revenues go up. Sometime later, the customers also get immune to such activities and churn faster.

Chains have their own set of issues.

Different stores cater to a different city and its characters. Each outlet is unique in terms of its catchment area, competitive landscape and physical terrain in terms of location, traffic patterns and consumer habits. This requires a localized management while being part of a chain.

The costs tend to be high and hence such outlets end up serving high end customers. QSRs have a found a way of bringing down the costs by limiting the offers in terms of menu and service and standardising the offers across the chain. The consistency requires a high level of quality management and better and centralised sourcing. While the front end costs are reduced, the back end costs increase putting huge pressures on profitability. Chains also have a problem of a high corporate overhead which are required to bring the focus and efficiency into business, but weigh heavily on the profits till a certain number of outlets are setup and stabilised.

It is very common to find that outlets become profitable sooner than the corporation.

With entry of large Indian and MNC companies, the industry gets boost of authenticity and creates euphoria. This produces a bubble which grows and grows and grows as a lot many new entrants come into the industry swayed by the entry of large corporations and without really understanding the nuances of the business. Very soon the market becomes murky. Customer seems to be happy as they are getting choices and better prices but enterprises bleed.

It is also expected that the growth in per outlet value would taper soon and even go

down in some cases.

The Bottom – Up Value Based Approach We suggest that the entrepreneurs who are already there and want to scale up

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Quick Serve or those who are entering into this high growth fast paced dynamic industry should follow a customer value based approach to build a sustainable business.

The industry is fraught with replication but has lacked scaling up. Even Calvin Care have decided to withdraw. That the opportunities are there has no doubts.

What one needs a business model to harness this opportunity. We present a framework that could be used to build such models. It covers three main processes – sensing value, creating value based offers and deliver value. Core of this model is company’s very own, the value proposition it promises to deliver and not the opportunity that lies out there.

Identifying the Value Proposition The value proposition identified by the firm is a combination of the entrepreneur’s own values that they cherish, the values being delivered by the competitors and the values that would be relevant to the customers. Sanjeev Kapoor feels, “We might be registering a shift of ‘mom n pop’ shops from conventional mode to organised retail, but restaurants suffered from high level of inefficiency and low ‘effort to return ratio’. I firmly believe that food retail will go the telecom way in the next fourfive years. Entrepreneurs need to break the mould and go ahead with growth.”

The statement clearly indicates that there is need to bring a change in the paradigm to succeed. One of the more common term used in this regard was propagated by Al Ries and Jack Trout in early 1980s as was called USP – Unique Selling Proposition.

They proposed that we must have

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experiences. Such consumer behaviours are shaped more out of expectations than the need. While good food is the most desired, the experiences desired by the different segments can be classified as “peak

something different or differentiated to succeed. While this is a gem of an advice for entering a business, it need not be helpful in sustaining.

The more pertinent question to be asked is: Unique: How do I maintain the Uniqueness?

Sustainability: How do I remain relevant to my customers?

Profitability: How I generate enough surpluses to grow and defend in a competitive market.

Customers tend to have a value ladder in their minds. Principally, there are four levels in this ladder. The role and importance of each of these levels are depicted in the figure given below. An entrepreneur need to choose the level it wishes to operate. While it is possible to move within the levels, it not desirable as the movement would disturb the association with customers and would lead to a confused or wrong positioning, very detrimental to the business. Many enterprises do not pay attention to this in the race to increase their revenue and pay heavily later on in correcting their

positioning.

Most companies choose one value to build their outlets and chains due to the requirement of a different business model for delivering different values. The cases of Cafe Coffee Day, McDonald’s, Subway, KFC, Haldiram exemplify this. For catering to different value segments, companies like Lite Bite Food, use different operating model such as Subway, Punjabi Grill, Asia Seven, Fresc Co, Zambar, each targeted at different requirements of the customers. An illustration of consumption of coffee at

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different location and their distinct value is given here.

Developing Customer Profiles The value takes different forms depending

experience” and “consumer or supportive experience”. Peak experiences as those activities that are the primary focus of

on the segment. It is very necessary that the organisation chooses the target segment carefully. The macro demographic segmentation may not be very relevant as can be seen from consumer studies. The table above also indicates that more than just the demographics, it is the SEC that is more relevant for outlet choice.

The NRAI study shows that the incidence of eating out is similar among all SECs, so are their preferences.

The behaviour is similar across the region and size of the cities. 15 Firms must therefore choose their segments very careful so that they can target their offering and not get swayed by the fact that everyone is eating out. The selection of outlets seems to be affected more by the

values that the customers cherish and the lifestyle that they live.

Customer Expectations Eating out is not just food but a lot of

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the trip, whereas supportive experiences are those peripheral activities necessary to accomplish the peak experience. In this typology, this has been adapted to a lifestyle setting assuming that eating out behaviours can be similar when compared with touristic behaviours.16 Consumers also tend to show a variety seeking behaviour both in terms of the outlets, formats and food. The frequency of visit is also lower and it is a planned activity. In addition, in most cases, eating out is the only activity they perform in

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classified based on the formats as given in the table below.

their outing.

Most customers visit with their families and friends. Added to it is also the expenditure in each visit. This makes the eating out a very involved activity.

Combining the two aspects customers could be classified as in figure below.

Each of these segments expects different experiences.

Choosing the Format Historically, restaurant referred only to places that provided tables where one sat down to eat the meal, typically served by a waiter. Following the rise of fast food and take-out restaurants, a retronym for the older “standard” restaurant was created, sitdown restaurant. Most commonly, “sitdown restaurant” refers to a casual dining restaurant with table service, rather than a fast food restaurant, where one orders food at a counter. Sit-down restaurants are often further categorized as “familystyle” or “formal”. In British English, the term restaurant almost always means an eating establishment with table service, so the “sit-down” qualification is not usually necessary. Fast food and takeaway (take-out) outlets with counter service are not normally referred to as restaurants.

Outside of North-America, the terms fast casual dining restaurants, family style, and casual dining are not used. The food service industry is also

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Customers tend to visit different type of outlets. Multi-cuisine is still the most visited. QSRs are visited by only 3% customers.18 It is still emerging and would slowly become preferable as the values sought by customers revolve around the psychological benefit of fun and enjoyment. Customers choose a restaurant based primarily on food.19 However, they expect more than just food. The choice of the outlet and the format is hence hierarchical in nature. An outlet that qualifies in each of these would become a preferred outlet.

Size of Opportunity An enterprise would need to arrive at the right size of the opportunity. “The fact that we employ ten times to what hotels employ, makes restaurants an integral growth story. The future is bright as we move ahead tapping the untapped zones like travel retail for example railway stations.” This is not exactly the total market, but the size of the market seeking those values. Since everyone is likely to visit the outlet but has a lower frequency and also variety seeking, the enterprise would have to target the share of the requirement and the share of the wallet, than the share of the market.

The proportion to actual size to the gross potential is 1:10. A firm must therefore build infrastructure based on the actual size. Unfortunately, most of the players design the plan based on the gross leading to higher entry cost. The gross potential

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also drives new entrants making the market potential vanish or difficult to get. Vikram Bakshi, MD & joint venture partner, McDonald’s India (North & East) added, “Establishing the business takes time in India, especially restaurants. Therefore, finding relevance for customers to come in a restaurant becomes a vital parameter of consideration. The sector is growing at 25 per cent per annum and the important aspect is to find your restaurant relevant.”

Building Resource and Capabilities The enterprise would, based on the opportunity, now have to build resources and capabilities required. The value desired to be delivered would be the pivot to identifying these resources and capabilities. The main resource is NOT money. It is just one of the factors of success. The critical resources are the infrastructure, attention to details, perseverance and customer orientation.

The capability to manage every customer, every transaction and changing competitive challenges determine the

success. It is not just opening the outlets; managing it to the changing customer expectations is the core. QSR is a people business.

Technology is becoming a core of this business. It encompasses the complete value chain from supply chain too production to delivery. In addition to food preservation, production and preservation technologies, successful QSRs tend to use information technology to manage their operations as well as delivering high quality in-store as well in-home services.

This would be then translated into decisions with regard to kind and range of food, location, supply chain, people, organisation and pricing.

Conclusion Eating out is a common phenomenon in India. Customers tend to go to different types of restaurants. They tend to show a variety seeking behaviour in terms of outlets and variety of food. This has created a large potential. The industry is also growing a rapid rate with some of the formats growing at more than 20% per annum. It characterised by its fragmentation with a large proportion

Quick Serve being unorganised. Even the organised sector consists of smaller independent units, very few chains and much less Indian enterprises. Attempts are being made by firms like Dabur, Reliance, Calvin Care and Haldiram to develop chains. The progress is slow and fraught with risks. This paper is an attempt to suggest a framework when starting or scaling up the business. The core of the framework is the value proposition that the company promised to it market based on value of the targeted consumer than the potential of the market. The process is bottom-up to reach at the top of the market. The value could be build around the chef, the food, location, pricing and experience.

Enterprises must choose one value on which the business would be built. In case it wants to address different value segment, it must choose different format that require a different business models, than a linear extension.

Author: Piyush Kumar Sinha, Professor, Indian Institute of Management Ahmedabad

Coca-Cola to invest additional $5 billion in Africa

C

oca-Cola says it will invest $5 billion with its bottling partners in Africa during the next six years. The promise is in addition to the soft drink giant’s earlier pledge to spend $12 billion on the continent by 2020.

The new investment will focus on improving Coke’s cooling and distribution equipment and its supply chain and logistics network.

Part of the investment will also go to programs aimed at

empowering women, securing clean water

supplies, and the sustainable production

Vol. 09 Issue 10 August 2014

of tea and fruits.

Coke sees a growth potential in Africa that is getting increasingly hard to come by elsewhere. As the developed world turns away from soda, Coke is looking to earn more from lessdeveloped regions.

That, as the total $17 billion in investments shows, can be a very good thing for the people of Africa.

And combined with the news that a number of nations are looking to invest $100 billion to improve Africa’s famously awful infrastructure, it’s not unreasonable to think - or at least to hope -- that Africa may be.

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Solus Jain Heights, #. 2, 1st Cross #. E-10, 10th Floor, J. C. Road, Bangalore-560 027. Tel: +91 080 22224223 Web: mtsfoods.com E mail: menonkk@vsnl.net

Vol. 09 Issue 10 August 2014

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Bioplastic packing in food processing Combining performance with sustainability

Plastics packaging – a success story There is no larger market segment in the plastics industry than the packaging segment. More than a third of all plastics are converted into packaging that is approximately 100 million tonnes worldwide. In industries 50 percent of all goods are packaged in plastics.

Without the various available packaging solutions, many sensitive goods would perish or be damaged en route to the customer. Packaging is also an excellent carrier for product advertising. It conveys important information to the consumer and enables efficient distribution of goods through compaction.

Despite its extreme light weight, plastics packaging can also be easily adapted to meet specific application demands.

However, the enormous consumption of conventional plastics in packaging means that today’s societal demands are not met.

The question therefore arises, how to turn

plastics packaging solutions into more sustainable products.

Bioplastics packaging – the next step The overarching problem of climate change and a noticeable shortage in fossil resources have accelerated the search for better concepts for plastics packaging.

Approaches to reuse and recycle plastics in closed loops need to be developed, keeping the guiding principle of efficient use of resources in sight at all times.

With the corresponding demands of converters and brand owners further driving the development of new solutions, bioplastics are expanding beyond their niche into the packaging segment.

Bioplastics use resources as efficiently as is currently possible while keeping food safe, enduring high heat, reducing CO2, and offering new recovery options.

In short, bioplastics packaging offer the same qualities as conventional packaging

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and even more.

Bioplastics packaging – market, materials, performance The bioplastics packaging market In 2013, global production capacities of bioplastics amounted to about 1.4 million tonnes with almost 40 percent of the volume destined for the packaging market – the biggest market segment within the bioplastics industry.

There is a high demand for packaging made from bioplastics to be used for wrapping organic food as well as for premium and branded products with particular requirements.

Market introduction is making dynamic progress with growth rates ranging from 20-100 percent, annually. Bioplastics production capacities have been forecasted to grow to more than 6 million tonnes by 2017 with most of these new volumes being converted to innovative

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Organic Packaging

packaging solutions.

ways, for example through

Governments can further foster this trend by promoting bioplastics packaging in the context of their innovation, resource and climate change policies. The transition from a fossil-based economy to a bioeconomy is an important globally.

• Bio-based materials, • material combinations, e.g. blending of different bioplastics, • a combination of recycling components from conventional plastics such as rPET with bioplastics (bio-based PET), • tailor-made additives, colour and processing aids, and • Continuous development of new biobased monomers.

Bioplastic materials in packaging Bioplastics are a diverse family of materials with differing properties. There are three main groups:

Bioplastics packaging solutions in the • Bio-based, non-biodegradable materials market such as bio-PE or bio-PET, • Bio-based and biodegradable materials Rigid packaging such as PLA, PHA or starch blends, Rigid bioplastics applications are • Fossil based and biodegradable materials (foremost blended with group 2).

Packaging from bio-based plastics has been developed over the past 10 years.

New materials such as PLA, PHA, cellulose or starch-based materials create packaging solutions with completely new functionalities, such as biodegradability/ compostability. The bio-based versions of conventional plastics, such as bio-PE and partly bio-based PET, are technically equivalent to their fossil counterparts.

The only difference is their resource basis. As the value added chain only has to be adapted at the beginning, bio-based PE, PET, PP etc are known as ‘drop-in solutions’.

All types of bioplastics used in packaging offer one outstanding advantage over fossil-based products: The use of renewable resources and, by consequence, the intrinsic value proposition of reducing the environmental impact of packaging.

Performance and processing of bioplastics packaging The performance and ecological profile of packaging can be improved in many

available, e.g. for cosmetics packaging of compact powders, creams and lipsticks as well as beverage bottles. Materials such as PLA, bio-PE or bio-PET are used in this section.

Several well-known brands such as CocaCola, Vittel, Volvic or Heinz use bioPET for bottles of all sizes containing sparkling drinks and other, non-gaseous, fluids. Procter & Gamble and Johnson & Johnson count on bio-PE to package different kinds of cosmetic products.

The high percentage of bio-based material in these products and the ability to combine them with recyclates from conventional PE and PET has resulted in a decisive increase in resource efficiency and a reduction of CO2 emissions.

As a potentially mechanically recyclable material, PLA is also gaining pace in the rigid packaging market. With growing volumes, a separate recycling stream will become economically feasible, and the beneficial environmental potential of PLA will be further increased.

Flexible packaging Many different bioplastics are used

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for flexible packaging solutions.

Biodegradability is a feature often sought when it comes to food packaging products for perishables. Biodegradable food packaging certified as industrially compostable was the first successfully commercialized Bioplastic product.

Films and trays are particularly suitable for fresh produce such as fruit and vegetables as they enable longer shelf life. In addition, confectionaries, such as chocolate and biscuits or dry food such as tea or muesli, are now being packaged with bioplastics.

Product examples in the market range from Ontex-Mayen, which has been using starch-based packaging for their Moltexeco baby nappies, to the Italian coffee brand Beanarella, which introduced compostable coffee capsules in 2012.

Service packaging Food service packaging is another large growth segment. Whether it is cups, plates, cutlery or carrier bags – the entire product spectrum can be made from bioplastics. These products are used at sporting events, street festivals, on planes or in trains. They can be made of bio-based non-biodegradable plastics

or of bio-based biodegradable plastics, depending on the end-of-life solution envisaged for the individual product.

The biodegradability of certain types of bioplastics enables the joint recovery with food residue via composting or anaerobic digestion, provided that conventional plastics do not contaminate this stream.

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Retailers across the world as Rossmann, Spar, Coop and Carrefour use single or multi-use carrier bags made from bioplastics - some with the add-on bonus of biodegradability. Certified biodegradable/compostable cups are also used at big events or in major football stadiums throughout Europe.

If Carrefour, Coca-Cola, Procter & Gamble and Co. are anything to judge by, all packaging materials in the future will be bio-based and easily (mechanically or organically) recyclable1. This is also the desired outcome for consumers, as is manifested in their shopping behaviour.

Bioplastic packaging in food processing industry Here are four developments from just the past few months in Bioplastic packaging for food that you need to know about.

Sugar cane gains traction The bioplastics industry is often thought

of as a subset of the corn industry. And certainly corn, which is produced at low cost and at tremendous volume, has been a common feedstock for bioplastics here.

But new sources of raw material for Bioplastic, such as rice starch, are attracting research and investment dollars.

And among the non-corn feedstock, sugar cane is becoming the most popular of all.

Earlier this month, Nature & More, a Netherlands-based global distributor of organic produce, began using - and selling - containers made from sugar cane. Its first major customer for the new plastic is the French supermarket giant Carrefour.

Nature & More’s new plastic arrives just as Coca-Cola’s Plantbottle technology, which has been in use since 2009, gains wider distribution .

The Plantbottle is a recyclable container made partially from sugar cane. Food

Organic Packaging

producers such as Heinz have been its customers, but now consumers are being sold on the Plantbottle directly.

Coke also likes PEF now Building bioplastics requires knowing a lot about chemistry. But even just talking about bioplastics requires knowing a teeny bit. For example, Coke’s Plantbottle uses a polyethylene terephthalate (PET) resin.

But one of the hottest new trends in bioplastics involves polyethylene furanoate (PEF), which is 100% plantbased. Both Coca-Cola and Danone teamed with biotech developer Avantium in 2012 to promote research into PEF bottles.

And just last month, Avantium received a new round of funding from those two companies, prompting speculation that Coke would like to walk away from PET, if PEF proves a viable alternative.

Bioplastics start to make consumers nervous Bioplastics are, almost certainly, better for the environment than traditional, petroleum-based plastics. But they’re not perfect. And in 2014, it seems that consumers have begun to find that out.

For example, the overwhelming majority of plastics made from plants can’t be composted (outside of an industrial composting unit). Stick them in a landfill, and they’ll stay there until roughly the end of time, just like a bottle made from petroleum.

In addition, genetically modified corn is common in much of the world’s Bioplastic production. And some of the same consumers and activists who are upset about GMO corn in their food are worried about food inside of plastics made with GMO corn.

Much of the bad publicity that is suddenly circulating about bioplastics is being generated by the petroleum-based plastics industry. But that doesn’t change the fact

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that bioplastics may be losing a bit of their “green” cache.

Telangana stake full-scale on food processing sector

A

mong the identified ‘core sectors’ for boosting industrial activity in Telengana this year, the government would push for attracting huge investments in food processing and agro-based industries.

The Telangana government plans to put greater emphasis on value-addition in the farm sector in its industrial policy.

New initiatives would be taken to achieve higher value-addition in food processing and agro-based industries as this alone would help farmers unlock higher realization for the produce and for sustained income.

The departments of industry and commerce, agriculture and agri marketing would coordinate together to achieve value maximization for farmers.

The state would also support those who plan to invest in setting up common facilities in the mega food park at Nandipet in Nizamabad district. Spread across 374 acres, Phase-I of the park would come up on 100 acres housing commonly-shared infrastructure facilities ranging from cold storage to food packaging units being built on a hub-and-spoke model.

The proposed “very large” agro processing facility in the state by diversified FMCG major, ITC Limited, would offer significant investment opportunities for smaller firms in the food processing value chain.

The government is also keen on encouraging e-marketing activities, which involves networking all agriculture mandis in the state so that farmers get access to prevailing prices across important markets and thereby helping them unlock the right value for their produce.

Further, the state in collaboration with research institutes in the country would facilitate an ideal adoption of latest practices ranging from seed technology and farm machinery to improve farm productivity.

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Food Scandal

THE FOOD SAFETY SCANDAL IN CHINA A n American company that supplies meat to some of the world’s largest fast-food chains in China has pulled all its products made by a Chinese subsidiary, after reports that it was selling expired products.

The food safety scandal that erupted in China in the last week has also spread overseas, affecting chain restaurants in Japan and Hong Kong, and prompted calls for tighter food safety regulation in China.

The privately held OSI is headquartered in Aurora, Ill., and claims 50 manufacturing facilities worldwide. Its Chinese subsidiary, Shanghai Husi Food Co.,

Ltd., sells beef patties, chicken nuggets and, according to its , cooked frozen snail meat. Its customers in China include McDonald’s, KFC, Pizza Hut, Papa John’s and Starbucks.

Shanghai television used a hidden camera to show workers of Husi Food Co., Ltd picking meat off the floor and returning it to the production line, and handling meat with ungloved hands. It also revealed documentation that the firm was falsifying production dates and selling expired beef and chicken to customers.

Customers eat at a McDonald’s restaurant in Hong Kong on Friday. McDonald’s restaurants in Hong Kong have taken

Vol. 09 Issue 10 August 2014

chicken nuggets and chicken fillets off the menu after a U.S.-owned supplier in mainland China was accused of selling expired meat.

Kin Cheung/AP Following the reports, McDonald’s restaurants in Japan have begun to source chicken from Thailand instead of China.

Hong Kong McDonald’s stopped selling McNuggets and chicken fillets from Husi.

This latest scandal joins a long list of similar recent incidents in China. These include with the industrial additive melamine, “gutter oil” salvaged from drainage ditches and reprocessed into cooking oil, rat meat being sold as lamb,

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Food Scandal

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and of agricultural land.

Meanwhile, to the fury of many Chinese taxpayers, their nation’s leaders are insulated from such risks, as their food through “special supply” channels, grown on pesticide-free, organic farms.

Still, China’s government has moved quickly to address the problem, arresting five people, including the head of Husi, and shut down nearly 600 restaurants.

China is currently revising its food safety laws amid calls for stiffer penalties for lawbreakers.

The incident is a good opportunity to push for improved food safety management.

Critics in China see the larger issue of food safety problems in the same light as pollution and industrial accidents: part of the high cost of blindly pursuing GDP growth, something China’s leaders vowed to end more than a decade ago.

China’s situation bears some resemblance to what the U.S. went through early in the last century, when shockingly unsanitary conditions in the meatpacking industry became a target of the progressive movement.

China’s government appears to be giving state-run media limited leeway to rake some muck of their own on the food safety issue, especially when the scandals occur at foreign-owned enterprises.

Consumers are being sold food including mozzarella that is less than half real cheese, ham on pizzas that is either poultry or “meat emulsion”, and frozen prawns that are 50% water, according to tests by a public laboratory.

The checks on hundreds of food samples, which were taken in West Yorkshire, revealed that more than a third were not what they claimed to be, or were mislabeled in some way. Their results have been shared with the Guardian.

Testers also discovered beef mince adulterated with pork or poultry, and even a herbal slimming tea that was neither herb nor tea but glucose powder laced with a withdrawn prescription drug for obesity at 13 times the normal dose.

A third of fruit juices sampled were not what they claimed or had labeling errors.

Two contained additives that are not permitted in the EU, including brominated vegetable oil, which is designed for use in flame retardants and linked to behavioral problems in rats at high doses.

This scandal is yet another wake-up call, reminding multinationals once more that they should and, in fact, must be above reproach. By now, all American fast food companies know the weaknesses in the Chinese food safety supply chain.

Chinese food safety inspection and regulatory enforcement are lax with too few inspectors for the job; multiple organizations have responsibility for aspects of food safety enforcement leading to different sampling and test results; and food safety data are not collected and analyzed in a systematic manner.

In addition, until China’s own food safety regime improves, U.S. companies will need to shoulder more of the burden by providing their own independent inspections and audits all along the supply chain. Of course, this won’t be easy. In Shanghai, alone, over 70% of the food products come from different regions in China. Wal-Mart, for one, has begun this process. Walmart reported that in 2013, it “conducted 894 examinations of suppliers and more than 6,000 professional inspections of their suppliers’ food.” There is also the option to shift the sourcing of the food: McDonald’s has already announced that its restaurants in Japan will now be getting their chicken from Thai suppliers.

Finally, U.S. companies should take the lead in educating their suppliers on food safety practices and partnering with local food safety commissions to strengthen enforcement capacity across the board. Multinationals have been strong supporters of Chinese civil society

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activity related to the environment through education and training; similar opportunities should be developed in the arena of food safety.

“Compared with Chinese food, many Chinese now prefer Western fast food.”

Now it’s time for the multinationals to step out in front and live up to this faith that has been put in them.

FSSAI elucidate that Ghaziabad Food Testing Lab is not closed

A

s alleged by NGO - Lok Jagriti – that the Ghaziabad food laboratory has been closed, the Centre and the Food and SAFETY Standard Authority of India (FSSAI) has informed the Delhi high court that it has not closed down its Central Food Laboratory (CFL) in Ghaziabad.

The submission was made before a bench of justices Badar Durrez Ahmed and Siddharth Mridul which had on July 9 sought an affidavit from FSSAI indicating whether it has closed its lab.

Mehmood Pracha, FSSAI’s advocate has submitted that the reason for fewer cases being referred to the lab for testing is the fact that it deals only with appeals of cases where a food sample has already been tested by a primary facility.

He denied the NGO’s allegation that lab was not getting cases because the authority is OUTSOURCING testing work to private labs. He also said that he had already filed his affidavit on the issue as per the court’s direction on July 9 but the same was not on record due to some objections raised by the registry.

The court listed the matter for hearing on August 27 after advocate Prashant Bhushan, appearing for the NGO, sought time to go through the report. The NGO had dragged the ministry and FSSAI to court alleging they had closed down the lab and are OUTSOURCING work to private entities. It had also challenged the appointment of the then FSSAI chairman K Chandramouli. However, this issue has become infructuous with the appointment of a new chairman on August 5.

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ASSESSMENT OF GENETICALLY

MODIFIED

FOOD

I

NTRODUCTION Genetically modified foods are crops, foods or plants that have been scientifically modified with the intention to enhance the nutritional content of the particular crop. It may also be created to develop resistance to bacteria, virus and other components that can damage the plant. Scientists claim that genetic modification is capable of creating crops with the desired output in a short span of time and with perfection, since conventional plant breeding methods consume more time and may also differ than the desired output. Genetically modified foods are being seen as the next big revolution in food technology.

Some of the GM foods available in the market are cotton seed oil, soybean, canola and corn. Advocates of GM foods also claim that these foods are capable of providing better nutritional value with a longer shelf life. It is also widely believed that genetic modification can bring down the cost of foods as many GM crops do not need the application of pesticides

as they are resistant to them. There is a lobby that strongly opposes the use of GM foods, they claim that certain GM foods can trigger allergic reactions in humans and may also be of toxic nature.

In his book “Sustainable development and GM foods”, Brian Meadows mentions that creating GM foods is a costly process, so it is obvious that companies producing them shall ensure profitable returns for themselves, hence cost of GM seeds are on the higher side. This may result in small farmers not being able to afford to buy these seeds. The same shall happen in third world countries too.

It was in the year 1946 when scientists first discovered, that the transfer of DNA between organisms was a possible task.

In 1983, an antibiotic resistant tobacco plant was produced which is believed to be first ever genetically modified plant. In 1994, the commercial sale of genetically modified foods began when the company Calgene developed Flavr Sar, a tomato with the delayed ripening factor. During the 1990’s a compound called Chymosin

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was approved for use by many countries.

Since then Chymosin has replaced Rennet for cheese making. In 1995, many crops gained marketing approval, some of them being maize, corn, canola, bt potatoes, soybeans and the virus resistant squash.

Since then, there has been a steady rise in the production of GM foods. Certain GM crops like the golden rice claim to have increased the nutritional value of the crop.

Today, US head the list of countries that produce genetically modified foods. 25 genetically crops have got the statutory approval from the US government production and commercial sale; following suit are other countries like Japan, India, Canada, Singapore, Korea, Australia, New Zealand and countries from the European Union. Apart from cash crops, today dairy and meat products are also being genetically modified.

They have been approved by the FDA (Food and Drug administration). The US Government claims that the testing of GM foods is done routinely using highend techniques. These tests are based

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on the screening of different genetic elements and event specific markers for the genetically modified organisms. They are a combination of different approaches like the plant specific markers, event specific markers and screening elements.

The tests are designed to detect any anomaly if present, in the inserted gene and whether it can have any adverse repercussions when consumed by humans and animals.

Around the world there are many controversies surrounding the use of genetically modified foods. The dispute involves scientists, biotechnology companies and Government regulators.

The controversy is mainly about the effect of GM foods on the environment, human health and whether GM foods should be labeled or not? There is a rising concern about the impact of GM crops on the economic status of farmers. In many countries it is mandatory to have genetically modified foods duly labeled, but not so in the US. This has raised concerns among organizations like the World wildlife fund and Greenpeece who feel that the risks associated with GM foods is not being satisfactorily weighed.

These organizations have questioned the US Government about its imperious attitude towards the issue.

The only GM crop permitted to grow in India is the BT cotton. Till now experts in India do not see any great results emerging from this GM crop. As a matter of fact, the organic cotton exports have been adversely affected by BT contamination, as organic cotton importers reject cotton which has the slightest trace of gene modification. The crop was produced to make the plant resistant to the bollworm, by producing a protein that is toxic for the worm, but certain kinds of worms have developed a resistance and other pests which earlier did not exist. These pests are damaging the crop a great deal.

In addition to this, the seeds cost nearly 10 times more than the previous seed price. Estimates say that in India, very few farmers may have been benefitted from BT cotton. In spite of the wide adoption of BT cotton, farmer suicides and indebtedness of the state has not decreased. This is an alarming revelation for advocates of GM crops in India. It was also noted that the crop triggered allergic reactions in cotton pickers.

INTERNATIONAL OF GM FOOD

ASSESSMENT

Biotechnology of GM food Using traditional and modern methods superior plant varieties are produced with improved characteristics that make them grow better or more desirable to eat.

GM crops are developed using the tools of modern biotechnology where precise tools are used to introduce only the desirable traits into a plant. In contrast, in traditional plant breeding, genes from two parents are mixed in many different combinations in the hope of getting the desired trait. Both methods have the potential to alter the nutritional value of plants or lead to unintended changes in concentration of natural toxicants or anti nutrients. However, these concerns maybe less frequent in transgenic plants since only a limited number of genes are transferred during genetic modification, unlike when traditional breeding methods are used.

Foods derived from GM crops have undergone more testing than any other food in history. Before entering the marketplace, they are assessed using guidelines issued by several international scientific agencies such as the World Health Organization, the Food and Agriculture Organization, and the Organization for Economic Cooperation and Development.

These guidelines include the following: • GM food products should be regulated in the same way as foods produced by other methods. The risks associated with foods derived from biotechnology are of the same nature as those for conventional foods.

• These products will be judged on their individual safety, allergenicity, toxicity, and nutrition rather than the methods or techniques used to produce them.

• Any new ingredient added to food through biotechnology will be subject to pre-market approval in the same way a new food additive, such as a preservative or food color, must be approved before it reaches the marketplace.

How are foods derived from gm crops assessed for food safety?

Before any GM food can enter the market, it has to be exhaustively tested by the

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developer and independently evaluated for safety by scientists or experts in nutrition, toxicology, allergenicity, and other aspects of food science. These food safety assessments are based on guidelines issued by competent regulatory agencies of each country and include: a description of the food product; detailed information about its proposed use; and molecular, biochemical, toxicological, nutritional, and allergenicity data. Typical questions that must be addressed are: • Does the GM food have a traditional counterpart that has a history of safe use?

• Has the concentration of any naturally occurring toxins or allergens in the food changed?

• Have the levels of key nutrients changed?

• Do new substances in the GM food have a history of safe use?

• Has the food’s digestibility been affected?

• Has the food been produced using accepted, established procedures?

Even after these and other questions about the GM food are answered, there are still more steps in the approval process before the GM food can be commercialized. In fact, GM foods are the most studied food products ever produced.

What are the issues?

Toxicity In nature, plants contain low concentration of toxins to protect it from insect pests and diseases. A list of many common plant toxins and anti nutrients is available in the Food and Drug Administration of the USA. It has guidelines that determine the normal and acceptable toxin levels of all crops varieties consumed based on toxicological studies. Natural toxin levels of GM crops are similar to their conventional counterparts.

The protein products of the inserted gene in the commercialized GM plants

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are evaluated in the toxicological tests.

Information on anticipated processing conditions that may result in the removal or denaturation of the proteinaceous material is part of the assessment. GM plant products are subjected to acute toxicity studies based on the premise that the mode of action of many known proteins is through acute mechanisms.

High doses of purified transgenic proteins which are expressed in bacteria or plant systems are administered orally. This is sufficient to evaluate the toxic potential of the new proteins.

Summary of Acute Toxicity Evaluation of Proteins Introduced in Commercial GM Crops

*(1) Cry = crystal protein endotoxins produced by some strains of Bacillus thuringiensis (2) NPT = neomycin phosphotransferase, a marker enzyme (3) CP4 EPSPS = 5 enolpyruvylshikimate3-phosphate synthase gene form Agrobacterium sp. Strain CP4.

(4) GUS = beta glucuronidase reporter gene ** NOEL = No observed adverse effect level.

Toxins of commercialized GM plants are easily digestible in a short time, thus, they are non toxic to humans.

One of the public’s biggest concerns related to GM foods is that an allergen (a protein that causes an allergic reaction) could be accidentally introduced into a food product. There are about 500 amino acid sequences of known protein allergens and 90% of all food allergies are associated with only eight foods or food groups – shellfish, eggs, fish, milk, peanuts, soybeans, tree nuts, and wheat.

These and many other food allergens are well characterized and so it is extremely unlikely that they would ever be introduced into a GM food. A variety of tests and questions must be considered to determine whether the food poses any increased risk of allergenicity

Allergens have shared properties, they are stable during digestion and food processing, and are abundant in foods.

Proteins introduced into commercially available GM foods do not have any of these properties. They are from sources with no history of allergenicity or toxicity; do not resemble known toxins or allergens biochemically and structurally; and their functions are well understood.

They are also present at very low levels in the GM food, are rapidly degraded in the stomach and have been confirmed as safe in animal feeding studies. The novel proteins in these GM crops have a history of safe use with no allergenic concerns.

The material (DNA) that encodes the genetic information is present in all foods, and its ingestion is not associated with any ill effects. In fact, we take in DNA every time we eat as it is present in all plant and animal material even when it is cooked or raw.

Antibiotic Resistance Some GM crops contain genes such as antibiotic resistance genes to identify cells into which the desired gene has been successfully introduced. Concerns have been raised that these marker genes could move from GM crops to microorganisms that normally reside in a person’s gut and lead to an increase in antibiotic resistance.

There have been numerous scientific reviews and experimental studies of this issue and they have come to the following conclusions: The likelihood of antibiotic resistance genes moving from GM crops to any other organisms is extremely remote or virtually zero: less than 10-14 to 10-27; and Even in the unlikely event that an antibiotic resistance gene is transferred to another organism, the impact of this transfer would be negligible, as the markers used in GM crops have limited clinical or veterinary use.

Nevertheless, in response to public concerns, scientists have been advised to avoid using antibiotic resistance genes in GM plants. Alternative marker strategies are being used in developing the next generation of GM plants (See PK 36).

SUBSTANTIAL EQUIVALENCE (SE)

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GM Fodd IN SAFETY ASSESSMENT OF GM FOODS Absolute safety is unattainable for any food as people react differently to natural ingredients of food. Substantial equivalence (SE) is an alternative approach used for the safety assessment of genetically modified foods where traditional toxicological testing and risk assessment to whole foods could not be applied. It is based on the idea that existing products used as foods or food sources can serve as basis for comparison.

The safety assessment is therefore based on a comparison of the modified food to its traditional (non GM) counterpart in terms of molecular, compositional, toxicological and nutritional data. SE has been used in the safety assessment of GM crops available today.

Mon 810 for example has been compared rigorously as to the levels of major nutritional components (protein, fat, ash, carbohydrates, calories and moisture) with the non transgenic counterpart Mon 818. Results showed that the amino acid composition, fatty acids, inorganic composition (calcium and phosphorous), carbohydrate components (starch, sugars and phytic acid, crude fiber), and tocopherol content of Mon 810 are within the range of Mon 818.

COUNTERVIEW TO ASSESSMENT? We need to notice all the hype and attention GM foods have been grabbing, but what is the truth? Though genetic modification is being said to be a major breakthrough in agricultural technology, only 175 million hectares of land have GM crops, this makes for merely three and half percent of the world’s agricultural land which spans through only 6 countries- Brazil, Canada, USA, Argentina, China and India. A majority of countries have rejected GM technology.

Countries are now getting legislations in place to assess the possible dangers that that may be associated with GM foods and the risks they pose to the environment and human health. The European countries follow more stringent norms before approving a genetically modified product.

Mexico is one country that has yet not allowed the genetic modification of its crops. India is evaluating the possible risks associated with GM crops. In 2011, India’s Parliamentary Committee

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GM Fodd

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comprising 30 members from different political parties conducted a study on GM crops.

They came to a conclusion that the claims that genetic modification will increase the yield of certain crops; is not completely true. They concluded that certain agribiotech companies may monopolize the seed market; this will compel farmers to buy fresh seeds every year as the patented GM seeds come with a limited life span; and buying seeds every year will burden the farmer financially. The committee demanded complete transparency on the field trials of GM crops and a globally accepted certification for such crops as there are many loopholes in the regulatory procedure.

CONCLUSION Genetically modified foods pose the same

risks to human health as do other foods.

These risks include allergens, toxins, and compounds known as antinutrients which inhibit the absorption of nutrients. Before marketing a genetically modified food, company scientists seek to determine whether these foods pose any heightened risks. The Food and Drug Administration (FDA) published guidelines to ensure that companies worked with the agency to assess the safety of genetically modified foods. GAO found that FDA’s evaluation process could be enhanced by randomly verifying the test data provided and by increasing the transparency of the evaluation process, including communicating more clearly the scientific rationale for FDA’s final decision on an assessment of genetically modified food. Scientists expect that genetic

Genetically ‘edited’ Fruit may be an answer to consumers’ GMO woes

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cientists have recently made advances in “editing” the genome - removing undesirable traits in food, but not introducing new genes as is done when foods are genetically modified. “Edited” food might be more acceptable than GMO food to consumers, according to researchers.

Examples of foods produced with gene editing would be apples that don’t brown

when cut, or bananas with increased levels of vitamin A, a life-saving development that scientists are already pursing with GMO techniques.

The first uses of gene editing would be in fruit, because science already knows so much about fruit genomes.

Perhaps the researchers are right that genetically edited organisms (GEOs) would

modifications will increasingly enhance the nutritional value of genetically modified foods. Although current tests have been adequate for evaluating the few genetically modified foods that have, so far, undergone relatively simple compositional changes, new technologies are being developed to evaluate the increasingly complex compositional changes expected. Monitoring the longterm health risks of genetically modified foods is generally neither necessary nor feasible. No scientific evidence exists, nor is there even a hypothesis, suggesting that long-term harm, such as higher cancer rates, results from these foods.

Moreover, technical challenges make long-term monitoring infeasible.

be less frightening to consumers than genetically modified organisms (GMOs).

And perhaps regulators in Europe and elsewhere who shun GMOs would welcome GEOs. But biotechnology is a crazily complicated field, and getting consumers to a) understand it, and b) accept it, isn’t easy. The key will likely be MARKETING, as it often is in food. Perhaps “edited” food is a little more marketable than “modified.”

121, 1st Floor, Rassaz Multiplex, Station Road, Mira Road (E), Dist Thane - 401 107, Maharashtra

By: Joshua Meltzer

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SKILL GAPS I

in

FOOD PROCESSING INDUSTRY

ntroduction Food processing is the transformation of raw ingredients into food, or of food into other forms. Food processing typically takes clean, harvested crops or butchered animal products and uses these to produce attractive, marketable and often long shelf-life food products.

Across the world, food-processing is considered to be a sunrise sector because of its large potential for growth and socio economic impact. It not only leads to income generation but also helps in reduction of wastage, value addition, and foreign exchange earnings and enhancing manufacturing competitiveness.

The processed food industry is divided into the following broad segments: • Primary processed food - which includes products such as fruits and vegetables, packed milk, unbranded edible oil, milled rice, flour, tea, coffee, pulses, spices, and salt, sold in packed or non-packed forms.

In today’s global market, quality and food safety have become competitive edge for the enterprises producing foods and providing services. “With proper investment in food processing, technical innovation and infrastructure for agriculture sector, India could well become the food basket of the world.

• Value-added processed food - which includes products such as processed fruits and vegetables, juices, jams, pickles, squashes, processed dairy products (ghee, paneer, cheese, and butter), processed poultry, and processed marine products, confectionary, chocolates, and alcoholic beverages.

The existing level of processing and the extent of value addition are very low as compared to other developing countries.

In India the food processing industry is ranked fifth in terms of production, consumption, export and expected growth . A strong and dynamic food

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processing sector plays a significant role in diversification of agricultural activities, improving value addition opportunities and creating surplus for export of agrofood products.

Food processing accounts for about 14% of manufacturing GDP, i.e. Rs. 2,80,000 crore, and employs about 13 million people directly and 35 million people indirectly. Its employment intensity can be seen by the fact that for every Rs. 1 million invested, 18 direct jobs and 64 indirect jobs are created in organized food processing industry only. It is widely accepted that the food processing sector is the most appropriate sector for creating jobs for rural poor, and thus reduce the burden on agricultural sector for creation of their livelihood. This is due to their familiarity with the agricultural sector which would make it easier to train and place them in food processing enterprises.

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Palm Oil slide to 1-year low

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alaysian palm OIL futures slipped to a near-one-year low this month, stretching losses into a third straight session as a bout of technical selling dragged on prices that were already under pressure from weaker competing edible oils. The benchmark October contract on the Bursa Malaysia Derivatives Exchange fell to 2,239 ringgit in late TRADE, a level last seen on Aug. 12, before settling 0.2 per cent lower at 2,249 ringgit ($703) per tonne by the day’s close.

Total TRADED volume on Wednesday was thin at 25,731 lots of 25 tonnes, much lower than the daily average of 35,000 lots.

Technicals showed that Malaysian palm oil prices may drop further.

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The multiplier effect of investment in food processing industry on employment generation is also higher than any other sector. Therefore, for the overall progress of economy it is important that the farmers and backward communities working in rural food-processing units are treated at the top of the growth process. Rapid and sustained poverty reduction requires economic growth which is inclusive and the one that allows people to contribute to and benefit from it.

In India, the food processing industry is highly fragmented and is dominated by the unorganized sector. A number of players in this industry are small. About 42% of the output comes from the unorganized sector, 25% from the organized sector and the rest from small players. Though the unorganized segment varies across categories but approximately 75% of the market is still in this segment.

The organized sector is relatively bigger in the secondary processing segment than the primary processing segment.

Increasing urbanization, consciousness on health and nutrition and changing lifestyle are changing the consumption habits of India. The number of working women, single students/professionals and nuclear families are creating demand for processed ready-to-eat foods.

Growth of organized retail, which makes the processed food readily available, is also driving growth of food processing.

Overview of Indian food processing industry In the post-independence period, India witnessed rapid growth in foodprocessing sector specifically during 1980s. It followed the first phase of the

Green Revolution that had resulted in increased agricultural production and the need for its post harvest management.

The importance of the sector was realized by the business community leading to diversification from grain trading to processing. Initially it was, rice processing which was followed closely by wheat milling, paper and pulp industry, milk processing sector, jute industry, sugarcane processing and oils extraction through solvent plants. In some areas like the solvent extraction industry, the growth in installed processing capacity has been far higher than the supply of the raw materials.

However, in other areas like fruits and vegetable processing, the growth has not been encouraging due to poor demand for processed products by the consumers. In such cases, the industry has also not been able to develop the demand adequately.

The low levels of processing are driven primarily by the food habits of the population. Fresh fruits and vegetables are preferred compared to processed fruits and vegetables.

Even after a strong agricultural production base, India’s food processing industry is still under developed. The highest share of the processed food is in the dairy sector, where 35% of total produce is processed, of which only 15% is processed by the organized sector. The processing level is around 2.2% in fruits and vegetables, 21% in meat and poultry products. Of the 2.2% processing in fruits and vegetables only 48% is in organized sector remaining in unorganized sector.

A study by McKinsey reiterates the importance of the food sector in India.

It indicates that food in India has an economic multiplier of 2-2.5. That is to say that for every rupee of revenue from food, the economy at large gets Rs. 2-2.50. This phenomena was highlighted in a study done in Uttar Pradesh for knowing the contribution of agroindustries in generation of income and employment generation for farmers, it was found out that the farmers involved in food processing industry as suppliers are able to increase their income to the extent of 69% for large farmers, followed

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Opportunity by 13% for farmers who owns 10 to 20 acres of land while it has increased lowest at 0.69% for farmers owning land below 5 acres of land sizes.

Presence of food processing industry also increases the hired workforce in farms.

It is over 75% for farms associated with industry in comparison to average of 72% of total hired workforce in agriculture.

Even after all these benefits, farmers and the private sector are yet to exploit the full potential of food industries in India.

There is a big market for products like sugar, coffee, tea and processed foods such as sauce, jelly and honey. The market for processed meat, spices and fruits is equally large. Tripling of the size of industry by 2015 is expected to generate direct employment of 28 lakh person days and an indirect employment of 74 lakh person days.

India is the largest producer of milk, fruits, pulses, cashew nuts, coconuts and tea in world and accounts for 10% of the world fruit production. Confederation of Indian Industry has estimated that the food processing sector has potential of attracting US$ 33 billion (Rs. 1, 50,000 Crore) of investment in next ten years.

The Indian domestic food market is expected to grow by nearly 40% of the current market size to Rs. 12,900 billion by 2015 and Rs. 17,200 billion by 2025.

It is important to fully utilize the untapped potential of the sector, and generate more revenue from the sector. If the policies of government towards food processing industry are analysed, there also it comes out that according to the vision 2015, the food processing industry is moving towards higher avenues, for example increase in the level of processing of perishables from 6% to 20%, value addition from 20% to 35%, increase in share of global food trade from 1.5% to 3%.

These targets can be achieved if policies are implemented properly and international standards match then food processing industry can become the leading industry of India’s economy, generating huge employment opportunities and increase in Income.

Still, there are significant constraints

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which, if not addressed sooner, can impede the growth prospects of food processing industry in India. At present, our share in exports of processed food in world trade has remained at about 1.5% or Rs. 16 billion. Competitiveness of Indian export items are coming down, eg. India slipped from first to third rank in tea export. It is no longer competitive even with Vietnam in marine products and spices. Indian exporters are largely small scale, often undercut each other, export low value-added products to small traders/agents overseas or bulk packaged commodities for reprocessing and re-packaging overseas where real value addition takes place. According to Annual Report of MOFPI, India produces 105 million tones of milk, 150 million tones of fruits and vegetables, 485 million Livestock, 230 million tons of food grain, 7 million tons of fish, 489 million poultry and 45, 200 million eggs, and still our presence at world stage is even less than 1.5%.

The major segments in the Food Processing sector comprise of fruits and vegetables, dairy, edible oils, meat and poultry, non-alcoholic beverages, grainbased products, marine products, sugar and sugar based products, alcoholic beverages, pulses, aerated beverages, malted beverages, spices, and salt. Out of these segments, dairy (16%), d grain based Products (34%), bakery-based products (20%), and fish and meat products (14%) contribute to a major portion of industry revenues, apart from the manufacture of beverages.

rather than organized sector. This is because of the fact that organized sector is very small in respect to unorganized sector.

Most of the policies developed by central government are generic in nature. In order to benefit from these policies, respective states have to evolve their own policies, which are in tune with their socioeconomic and agri-livestock resource base. The policy from the centre and state should incentivize and encourage Public Private Partnership (PPP) in overcoming various constraints namely, nonavailability of adequate infrastructure facilities, cold chain, packaging and grading centers, lack of adequate quality control and testing infrastructure, inefficient supply chain, shortage of processable varieties of farm produce, season ability of raw material, high inventory carrying cost, high taxation, high packaging cost, affordability and cultural preference for fresh food. .

The food processing sector is governed by multiple acts rather than a single comprehensive policy on food processing. The food laws governing food processing industry span nine ministries, comprising 13 central orders alone; in addition states have their own control orders. The policy to be effective will have to be comprehensive and adopt a number of legislative, administrative and promotional measures. According to NABARD village level agro-industry does not come within the purview of any single Ministry. Because of this problem, only a fraction of the village level agroindustries are registered. It says further that an overwhelming proportion of the registered enterprises are registered with

Opportunity the village panchayats.

To infuse technology and credit in agroindustry, it is required to bring them under single registration authority and start a massive campaign to register village level agro-industries. It goes on to state that in spite of the government programmes, lack of infrastructural facilities hinders the growth of agro-industries.

Lack of skilled and trained manpower in food processing industry is also a big issue. Many positive developments in the food processing sector have also resulted in the apprehension about the emerging skill shortages due to mismatch between the demand for specific skills and available supply. In fact, of late, shortage of skilled, semi-skilled and unskilled workers has emerged as a critical factor impacting the competitiveness of Indian food industry.

Around 58% of the employers are dissatisfied with technical skills and knowledge needed for the job.

Also 72% showed discontent with employees’ ability to use appropriate and modern tools, equipment, and technologies specific to their jobs. The food processing industry has many challenges in front of it, ranging from infrastructure to human resources and to technological backwardness. Now, with the growing demand of processed food there is a need to address these problems and concerning issues on priority basis. Else, India will miss a golden opportunity of using its vast agri livestock resources to strengthen its economy, revive its rural industries and create employment for thousands of people.

Skill gaps in food processing industry There is a wide gap between skills needed and skill available. If India is to make its presence in the world market, then there is a need to bridge this gap as Annual demand for skilled human resource in organized sector in soon as possible. There is a huge gap in food processing industry demand and supply market. According Required annual demand to a survey done by NSDC, there is a Category huge demand for skilled workers at all the stages in food processing industry, Food technologists (Post Graduate) 2,384 especially for person with short term Food technologists 5,363 course training, having education level Diploma ITI/ITC 4,768 below 10th/12th standard.

Short term-course trained personnel 4,768 95,351 The demand for skilled human resource with education below 10th /12th std.

112,633 is continuously increasing, but there is Total greater demand in unorganized sector

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Opportunities Indian food processing industry has seen significant growth and changes over the past few years, driven by changing trends in and changes over

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www.agronfoodprocessing.com Skill gaps present in various segments of food processing industry

Types of gaps

Dairy

Food grain milling

Food and vegetable

Meat and Poultry

Fish and Marine Products

1

Production

Inadequate knowledge of ways of maintaining the quality of produce.

Inadequate knowledge of breeds, feeding, disease control, and poor knowledge of hygiene maintainenace and management practices.

Inadequate knowledge of latest / best farming practices because of lack of training /access to other information sources.

Inadequate knowledge of percentage increase in value with minimal value addition to Produce.

Lack of knowledge of grading and standardization of food grains.

Inadequate understanding of ways to minimize breakage of grains.

Inadequate / restrictive motivational skills Inadequate documentation Skills / not conversant with e-reporting / working on computers.

Inadequate knowledge of operations resulting in wastage

Inadequate consistency in Operations due to inadequate understanding of immediate or long term impacts.

Tendency to change jobs frequently, leading to a high attrition rate and consequently lower quality of work and lower productivity

nadequate knowledge of fish breeding and rearing processes. Inadequate sensitivity to environmental issues, thus leading to poor hygienic conditions

2

Testing

Inadequate ability to practically conduct tests and record results, no knowledge of correct sampling methods

inadequate practical expertise in conducting tests. The field needs Visual examination skills for faster segregation and checking of input/output and ability to record the results as they are observed and reporting non adherence to standards.

Inadequate ability to apply technical expertise and Procedural knowledge in actual work situations, especially at the entry level.

Inadequate ability to conduct tests and record results.

Inadequate technical knowledge for primary medication in case of disease/ medication

Inadequate technical knowledge about the new machines and the associated aspects of maintenance

3

Procurement

Inadequate ability to forecast demand.

Inadequate communication skills, especially in local language because of diverse dialects Poor knowledge of making milk by-products, and inability to increase their shelf lif

Inadequate ability to forecast the demand accurately.

Inadequate training skills for encouraging the producers for better productivity and quality.

Inadequate ability to follow rules of marking gunny bags

Inadequate knowledge and ability to educate farmers on demand, advice on farming and wastage reduction.

Inadequate communication skills to be able to motivate farmers for better quality and higher productivity.

Inadequate awareness of prevention care techniques.

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the past few years, driven by changing trends in markets, consumer segments and regulations. These trends, such as changing demographics, growing population and rapid urbanization are expected to continue in the future and, therefore, will shape the demand for value added products and thus for food processing industry in India.

and offers significant growth potential to investors. There is a huge opportunity to develop S&T capability and R&D in the sector.

The Government of India’s focus towards food processing industry as a priority sector is expected to ensure policies to support investment in this sector and attract more FDI. India, having access to vast pool of natural resources and growing technical knowledge base, has strong comparative advantages over other nations in this industry.

There is a need to train the unskilled labor force, need for development across various human resource profiles. India can harness all the opportunities present in food processing sector only when its labor force is educated and skilled. The government needs to strengthen its skill development program; new training institutes should be open up, which are in tune with market demand. The development of infrastructure facilities like cold chain, road facilities, and power will strengthen the food processing industry.

The food processing sector in India is clearly an attractive sector for investment

It will have a very positive sign on perishable food products industry, such as

320,000 jobs can be generated in Uttarakhand by food processing

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study by the Associated Chambers of Commerce and Industry of India, says adoption of an integrated approach to facilitate development of an agriculture and food processing industry in Uttarakhand can create 320,000 additional employment opportunities. In five years, about 30,000 direct and about 290,000 indirect jobs could be generated.

With the two mega food parks - one in Haridwar and one in Udham Singh Nagar district - expected to start within next four years, it is likely to contribute about Rs 6,000 crore (including ancillary and support units’ contributions) to Uttarakhand’s gross state domestic product,” said the study, Food Processing Opportunities in Uttarakhand.

The study was released by P K Jain, chairman of Assocham’s national council

on MSMEs, and the chamber’s SecretaryGeneral D S Rawat.

It said promoting the food processing

sector will emerge as the cornerstone to raise the contribution of agriculture and allied activities in Uttarakhand’s GSDP from 13 per cent to about 25 per cent over a 10-year period.

Farmers must be encouraged to adopt fruit cultivation by adopting simple value-addition techniques, it said.

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fruit and vegetable, dairy industry, meat and poultry segment. The food processing industry is all set to drive Indian economy to higher growth, only need is to pay due attention on technological development of field, and generation of skilled manpower.

McCain Foods to close Canadian French fry facility

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anada-based McCain Foods is to close its French fry facility in Borden-Carleton, Prince Edward Island (PEI) province, Canada.

The move, which could result in the loss of around 121 jobs, is due to a shift in the market for French fries and the stronger Canadian dollar.

The facility is expected to close by the end of October 2014.

According to McCain Foods, the facility is the smallest and least utilised plant in its network of facilities across North America.

The company also noted that it will provide early retirement benefits and severance packages for affected employees.

McCain Foods Americas president Frank van Schaayk said that the company will contribute $2m and collaborate with the provincial government in the development of initiatives that create sustainable jobs for its affected workers.

“We deeply regret the personal impact the closure will have on our PEI employees,” he added.

PEI potato board chairman Gary Linkletter said: “We were shocked and disappointed by the news from McCain earlier today.”

The group said that McCain contracted with 23 Island family farms for the delivery of around $7m worth of potatoes to the Borden-Carleton facility this year.McCain operates 50 production facilities in six continents with around 19,000 employees.

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Event Press Release

5th edition of Food & Bev Tech 2014

An International Exhibition and Conference, between 22 - 24 August 2014 at Mumbai CII’s Vision: To Position India as a Major Global Player in the Processed Food Sector and in Making India the Food Factory of the World.

CII is organising 5th edition of Food & Bev Tech 2014, an International Exhibition and Conference, between 22 - 24 August 2014 at Mumbai, India concurrent to Food & Bev Summit 2014 under the chairmanship of Mr Piruz Khambatta, Chairman & Managing Director, Rasna Pvt. Ltd. Food & Bev Tech 2014 is India’s foremost event for food processing and packaging industry, providing an unparallel opportunity to market and promote products and services to Industry leaders, decision makers, CEOs, Purchase managers, technical heads from the processed food industry and network with the end consumer to understand their needs and demand.

The exhibitor profile at Food & Bev Tech 2014 includes process & packaging technology, refrigeration & preservation technology, ingredients & raw materials, measurement & control systems, analytical & hygiene equipment and supply chain solutions, thus providing a comprehensive overview of modern food & beverage technology.

Food & Bev Tech is hailed as India’s No. 1 first ever focused technology show for the Food & Beverage Processing Industry.

Food & Bev 2014 shall provide an excellent platform for Processed Food & Ingredients industry to present products and services to an increasing competitive market of food and beverage industry professionals, distributors, wholesalers and importers, supermarket chains, hotels, restaurants, Airlines, Railways, food service providers and also interact with

buyers and delegates on innovations that could benefit all.

Food & Bev Tech 2014 and Food & Bev 2014 is supported and endorsed by galaxy of food and beverage associations based in India.

Important participants in this edition are Blue Star, Merck Millipore, KHS Machinery Pvt. Ltd., Repute, Cipy Polyurethane, USP Packaging, Videojet Technologies, GOMA, Cole Parmer, Agilant Technologies, Minipack, Technofour Electronics, Interlabels, Testo, Exxon Mobil, Rasna, Tata Chemicals, ITC Infotech, Maiya’s, to name a few.

Major attractions of Food & Bev Tech 2014 1) Food & Bev Tech will see dignitaries from the Ministry of Food Processing Industries and the Maharashtra Agro Industrial development corporation, Chhattisgarh State Industrial Development Corporation and from countries like Botswana, Israel, Malaysia and Mauritius.

2) Pavilions of the Ministry of Food Processing, Chhattisgarh State Industrial Development Corporation, Maharashtra Agro Industrial Development Corporation 3) Participation from countries like Botswana Investment & Trade Centre, Mauritius Investment & trade Centre, Consulate General of Israel and Consulate General of Malaysia.

4) State pavilions from Madhya Pradesh and Orissa showcasing their strength in the food sector.

5) Innovative Product Pavilion First time in Indian Exhibition Industry, CII has introduced a concept of dedicated space for Innovative Product Pavilion

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within exhibition area, where exhibitors are allowed to Display their new and innovative Products. This facility is available to all confirmed exhibitors, free of cost.

6) CII along with Assocom Institute of Bakery Technology & Management introduces a two day workshop on New Product Development in Bakery to impart basic knowledge on new and innovative product development of bakery products.

CII is working towards the vision of ‘Positioning India as a Major Global Player in the Processed Food Sector’.

To achieve this vision, CII has been working closely with the Government in strengthening the policy framework required to promote competitiveness and innovation in the Indian Food Industry. Food processing Industry in India has emerged as one of the most promising sector for investors to invest and undoubtedly the sector has experienced a remarkable growth.

CII is proactively involved in building and enhancing the capacity of this sector in the area of Food Regulations, Processing Technology, Safety and Quality.

CII is catalysing Growth of the Food Processing Sector, Partnering with Government, Semi government Consumer Bodies & International Agencies, consumer bodies and international agencies.

For further details please contact: Saurabh Rajurkar T: +91 22 24931790 E: saurabh.rajurkar@cii.in www.foodbevtech.com and www.foodbev.in

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New Product Launch

Markem-Imaje launches the 9028, a new inkjet printer offering simplicity and autonomy

T

he new Markem-Imaje 9028 inkjet printer has been conceived and engineered for industrialists with an eye for simplicity, evolution and autonomy. Ideal for small industrial application customers, the new 9028 offers excellent marking quality. As successor to the popular 9020 version, with over 40,000 sales, the new 9028 printer features several innovations for enhanced performance.

In particular, the new 9028 printer has been fitted with a completely rethought ink circuit (M6’) that can operate nonstop for over 2 years*.

Clean, practical and easily recyclable, the M6’ ink circuit can be replaced by operators themselves, in less than 6 minutes, by simply clicking it out and in with a single, supplied tool. An alarm system offers a high degree of flexibility where replacement programming is concerned. Last but not least – 15% less additive consumption.

At the consumable level, new inks are available: a range of high-adhesion inks for the most difficult substrates to be marked, a MEK-free quick-drying ink and a permanent ink. Consumables are presented in new sealed cartridges which display the quantity remaining with greater precision. Easy-to-handle cartridges are quick and clean to replace, without stopping production operations. Finally, cartridges from other Markem-Imaje CIJ printers are completely compatible and can be used in the 9028 model.

The 9028 printer has been designed to plug and print. A latest-generation system of printhead cleaning ensures instant daily startups and trouble-free restarts, even after several weeks of downtime. It is operational just a few

minutes after installation. Finally, a stainless steel stand and an IP55 protection rating ensure that the 9028 printer can be installed in the toughest manufacturing environments, without any specific installation requirements. * On the basis of an annual operating time of 3,000 hours Finally, as a worthy successor to the 9020 printer, the 9028 model codes most substrates (cardboard, plastic, metal...), prints up to 4 lines of data and can reach a speed of 4.4 m/s. Its user-friendly, intuitive interface can efficiently guide operators in their daily operations with total autonomy.

About Markem-Imaje Markem-Imaje, a wholly owned subsidiary of the US-based Dover Corporation is a trusted world manufacturer of product identification and traceability solutions, offering a full line of reliable and innovative inkjet, thermal transfer, laser, and print and apply label systems.

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Vol. 09 Issue 10 August 2014

India in quest of amendments to subsidy as it would hit food aid

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ndia along with the G33 countries, it is seeking amendments to the 10 per cent subsidy cap of the WTO as it would hit the food aid programmes in the developing countries.

G33 countries are grouping of developing nations. The WTO’s Agreement on Agriculture does not restrict public stockholding programme for food security purposes.

However, if food grain is acquired at administered prices and not at market rates, all such price support has to be kept within a limit of 10 per cent of the value of production of the commodity in question.

Minister of State for Agriculture and Food Processing Industries Sanjeev Kumar Balyan said in a written reply to the Rajya Sabha, said India, as part of a coalition of developing countries known as ‘G33’, has proposed an amendment to this cap that is a constraint to procurement and food aid programmes in developing countries,”.

Last month, India has decided not to ratify the trade facilitation agreement, aimed at easing customs procedures, because the WTO members have not taken any step towards finding a permanent solution on the food subsidy issue of India.

During the WTO’s Ministerial Conference in Bali last year, it was agreed by the members to put in place an interim mechanism and to negotiate for finding a permanent solution on public stockholding for food security purposes within four years.

“In the interim, until a permanent solution is found and subject to certain conditions, members will not be challenged in the WTO even if the support in respect of public stockholding programmes for food security purposes exceeds the limit of 10 per cent of the value of production in question,” he said.

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Castor

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Castor:

An export oriented non edible oilseeds crop in India

Dr. Sarvesh Kumar Shah Main Castor Mustard Research Station, S.D. Agricultural Station, Sardarkrushinagar, Gujarat Email: sarveshshah@gmail.com

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astor (Ricinus communis L.) (commonly known as Erand in Hindi) is an important non-edible oilseed crop of Euphorbiaceae family.

It is believed that castor is originated in the tropical belt of both India and Africa. Castor is not new to Indians as the medicinal benefit of castor is known to the since ancient time as it was evidenced in the great ancient Indian books like Susrut Samhita and Charak Samhita, written about 2000 years back. It was known for cultivation in ancient Egypt as long as 400 B.C. back.

The commercial cultivation of castor is carried out in 30 different countries especially in arid and semi-arid region.

India, China and Brazil are the major castor growing countries and accounting for about 90 per cent of the world’s total castor production. The latest statistics shows that worldwide castor is grown on a total area of 1.69 m ha with a production of 1.96 m tonnes, with average productivity of 1160 kg/ha (FAOSTAT, 2014). Earlier, in the decade of sixties and seventies, Brazil was the leading castor producing country, but the shifting interest of Brazilian farmers from castor towards other remunerative crops, their production came down. On the other hand in India, the introduction of improved varieties and hybrids of castor and adoption of scientific castor cultivation practices, the production and productivity of castor has increased many folds. Subsequently, after the decade of eighties, India emerges as major castor producing country and after that maintained the status of the largest producer of castor in the world and dominates in international castor oil trade.

During 2012, India produced 1.63 million tonnes of castor. While the second largest

producer countries, China produced 0.17 million tones of castor, respectively (Fig. 1). Due to suitable climate and cheap labour, the castor production in African subcontinent countries like Mozambique, Ethiopia, Kenya, South Africa, Sudan, Uganda and Tanzania, etc. is increasing.

It was noticed that in 2012, Mozambique, with a castor production of 0.06 m tones has emerged as third largest producer of castor in world while the Brazil has come to the forth position. The details of world area, production and productivity of castor are presented in Table 1.

Fig 1. Production trend of Castor in major producing countries

(FAOSTAT 2014) Table 1. Area, Seed yield and total seed production of Castor

(FAOSTAT 2014) Castor production scenario in India: The production of castor underwent

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a significant increase in India and the country became first in the world to exploit the hybrid vigour of castor for commercial uses. India has shown an upward trend in castor production.

India’s share in world castor production was jumped to 83.0%, of which was about 76.8% in 2010; 58.7% in 2001; and 18.8% in 1961 otherwise. At current levels of castor production, India accounts for 66% of area and nearly 83% of the world’s total output of castor (FAOSTAT, 2014). The cultivated area for castor has increased from 881 thousand ha in 1961 to 1630 thousand ha in 2012. The compound growth rate in area of castor production was nearly 1.3 per cent per annum. The production has increased at 4.0 per cent per annum for the same period.

However, the rate of growth in the productivity was 2.6 per cent per annum. The production exhibited a high variation when compared to cropped area and yield.

Gujarat, Rajasthan, and Andhra Pradesh contribute about 96% of the total castor production in India. Gujarat has the maximum area under castor production; it accounts for more than 86% of the total castor seeds produced in the country.

The introduction of hybrid varieties of castor gave a tremendous boost to the castor production especially in Gujarat. Before introduction of hybrid varieties Andhra Pradesh (A.P.) was castor production hub.

The sowing periods of castor vary across the country. Castor requires a warm climate but damaged severely by the

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frosts. It is a mainly a Kharif season crop, however, in some areas having assured irrigation facility, Rabi Castor is also grown. In general, sowing of castor with onset of monsoon is most beneficial under rained condition. Since it is planted late (July–August), any damage to other cash crops in previous months encourage farmers to adopt castor. The crop grows for four to five months and is generally harvested in December and January. The shelf life of harvested castor beans is about two to three years. Castor is usually raised either as a sole crop or mixed crop with Kharif cereals / millets (sorghum. fingermillet, pearlmillet, maize) grain / legumes (pigeonpea, groundnut, mungbean, urdbean and cowpea) and sometimes with vegetable crops like chillies, turmeric and ginger. A number of productive and remunerative cereals/ legumes-castor sequences are identified for different agro-ecological situations in the country either as a regular or contingent measure (Table 2).

Table 2: Productive and remunerative crop sequence of castor with other

crops Castor Oil: Castor oil is obtained from pressing castor seeds. The oil content of the seed ranges from 40-55%. Castor oil is a pale yellow, viscous, non-volatile and non-drying with a bland taste. Castor oil by itself is used in diverse applications, chemical derivatives of castor oil find numerous uses in industrial applications and their domains of use are increasing rapidly. Castor oil is also distinguished from other vegetable oils by its high specific gravity, thickness and hydroxyl value. The oil is unique among vegetable oils due to presence of a hydroxyl fatty acid known as ricinoleic acid (12-hydroxylcis-9-octadecenoic acid) which constitute around 90% of the total fatty acids.

Therefore, it is considered as one of the

few naturally occurring oils which is like a pure compound. The hydroxyl group of ricinolic acid imparts, a very high degree of viscosity and oxidative stability which is four times more stable than olive oil.

Castor oil can be stored for long periods without appreciable deterioration for periods upto 2 years. Some common characteristics of castor oil and fatty acid composition are given in Table 3: Table 3: Characteristics of castor oil

and fatty acid composition Nagraj (1995) The castor oil is extracted by either one or a combination of mechanical pressing or solvent extraction. The four main stages in the production of castor oil, castor oil grades and derivatives are: a. Castor seed harvested from field is dried till the pods open. Seeds are hulled to remove the seed from the pod. Seed contains about 48-50 % of oil by weight.

Oil extraction through expeller unable to extract full amount of oil from seeds and the cake left contains 8 to 10 % oil. It is crushed into a coarse meal, and subjected to solvent extraction with hexane or heptanes or ether (solvent extraction) for better oil recovery. b. The purification of extracted oil is done by the filtration systems designed to remove particulates, water, dissolved gases, and acids. c. The filtered oil (called the crude or unrefined oil) is sent to the oil refinery.

The steps to refine the crude oil include: i. Settling and Degumming of the Oil (Removal of the aqueous phase from the lipids, and to remove phospholipids from the oil). ii. Neutralization - (Removal of free fatty acids and phospholipids from the oil). iii. Bleaching -(Removal of coloring materials, phospholipids and oxidation products). iv. Deodorization - (Removal of volatile flavor and odour from the oil). d. Production of castor oil grades & derivatives are done by undergoing

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Castor chemical reactions (like Hydrolysis, Esterification, Alcoholysis, Saponification, Halogenation, Oxidation, Polymerization, Hydrogenation, Epoxidation, etc. Table 3) and/or processes (Degumming, Bleaching, Dehydration, Splitting & Distillation, Evaporation etc.) the refined castor oil is transformed into its various grades and a plethora of useful chemical derivatives.

The Castor oil thus extracted is sold in the market or exported. For different purpose, different grades of castor oil are used.

The price of castor oil is determined by the grades of castor oil. Various grades of castor oil area. Industrial / Commercial Castor Oil: Industrial castor oil is obtained from a mixture of the first pressing and the second phase of production - solvent extraction. b. First Special Grade Castor Oil: It is produced by refining commercial grade castor oil using bleaching and filtering processes. Pure, refined FSG castor oil is a pale yellow, viscous clear liquid with key characteristics f.f.a.(as oleic) 1.00% max, acid value (mg KOH/g) 2.00 max, hydroxyl value 158-163, colour on lovibond in 5.25”cell Y-20.0 max, R-2.0 max. c. Cold Pressed Castor Oil: Cold pressed castor oil is a virgin form of castor oil extracted in its natural form by pressing the seeds without using steam cooking.

The process helps preserve the oil’s herbal and healing properties. It is mostly valuable for pharma industry. d. Refined Castor Oil (Pale Pressed Grade): The Pale Pressed Grade of Castor Oil is obtained from the first pressing of the castor bean. Pure, refined castor oil (Pale pressed grade) is a pale yellow, viscous, brilliantly clear liquid and free from suspended matter with key properties such as f.f.a.(as oleic) 0.50% max, acid value 1.0 max, hydroxyl value 160-163, unsaponifiable matter 0.70% max, colour on lovibond in 5.25”cell Y-10.0 max, R-1.0 max. e. Pharma Grade Castor Oil: Pharmaceutical grade castor oil is produced from the first pressing of castor seed in which the oil does not lose any

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medicinal qualities. Produced as per USP, JP, BP, EP, IP, DAB pharmacopoeia, it is used as emollient for pharmaceutical creams and lotions.

Castor Uses: Up to the beginning of the 20th Century, the use of castor oil was limited as a purgative. With the increase in mechanization and advancement of chemical technology, a number of usages of castor come to the service to the mankind. In castor oil, about 8590% of its fatty acids are ricinolenic acid that allows for “derivatization” which is not possible with most other seed oils.

The castor oil is used for preparation of many derivatives which has a number of applications (Table 4). Castor oil is a valuable chemical feedstock and finds its way into innumerable uses.

Table 4: Key Derivatives of Castor Oil, Starting Products & Methods of Production

The oil is used in the manufacturing of adhesives, brake fluids, caulks, surfactants, coatings and inks, dyes, electrical liquids, dielectrics, jet engine lubricants, lubricating greases, machining oils, paints, pigments, polyurethane refrigeration lubricants, rubber sealants, textiles, nylon 11, nylon 6-10, washing powders, and waxes for preserving leather and other uses. The dehydrated oil is an excellent drying agent which compares favourably with tung oil and is used in paints and varnishes. The hydrogenated oil is used in the manufacture of waxes, plastics, carbon paper, candles and crayons.

In food processing industry it is used as an additive for flavouring and also as a mould inhibitor. It also finds its way in the manufacturing of hair oil, lipsticks and cosmetics. It is also used in the making of equipments used for national security,

and in the production of polymers for electronics and telecommunications as well. Castor is used even in anti-cancer therapy and in the treatment of skin ulcers.

Castor beans present possibilities for total plant utilization as leaves for silkworm feed, shell for sugar extraction, and seeds for oil and meal. Though, the protein content of castor meal varies from 2148%, has an ideal amino acid profile with moderately high Cystine, mithionine, and isoleucine, it can not be used for animal, poultry feed even in small quantities. This is because of the fact that the seeds and residual cake are highly poisonous due to presence of anti-nutritional substances ricin, ricine and an allergen. However, it can be used as a fertilizer.

Castor cake is an excellent fertilizer because of high content of organic matter (85%), N (6.4%), Phosphorus (2.5%) and Potash (1.0%) and capacity for moisture retention.

Castor seed oil cake is very useful manure to crops as it released nutrients slowly. It means better nutrient uptake and more nutrient use efficiency.

It is a very good fertilizer alternative containing optimum levels of Nitrogen, Phosphorous and Potassium which is suitable for cultivation of Paddy, Wheat, Maize and Sugarcane. Castor oil meal was exports to countries like South Korea and Japan. Domestically it is less marketed. Recently the Government has included the deoiled castor cake as Nonedible deoiled cake Fertiliser (Control) Order (1985) (Table 5).

Table 5 :Some Specifications of Nonedible De-oiled cake fertilizer

Source: Biofertilizers and Organic Fertilizers in Fertilizer (Control) Order, 1985 In the recent past, castor has attracted

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Castor the attention of the researchers globally because of its high oil content and relatively high crop yield which provides a safe opportunity for biodiesel production without the risk of displacing food crops.

Biodiesel production from castor reduces the risk of greenhouse gases emissions upto 90% compared to petroleum diesel. It finds uses as a feedstock to the transesterification process for the production of biodiesel. Many characters are found suitable for its use as biodiesel (Shah et al, 2014) But, high viscosity, high water content, higher compressibility than other vegetable oils, reduction of about

10% of hydroxyl and acid values if stored for about 90 days and the premium price of castor oil are the major issues limiting the use of straight castor oil as a fuel for internal combustion engines (Scholz and da Silva, 2008) (Table 6).

Table 6: Fuel specific properties of castor oil Castor Oil Export Trend from India: In early 90’s, Brazilian farmers moved away to more lucrative cash crops, and surge in domestic demand in China made them net importers, leaving India to meet the global demand. India holds around 90 % share in the total castor oil exports in the world.

The major importing countries of castor oil are the European Union, USA, China, USSR and Japan. India has exporting about 4.72 million tones of castor oil and earned a foreign currency worth Rs. 3658.78 crores for the nation(Table 7).

Table 7: Export of castor oil The Solvent Extractors’ Association of India Challenges for Castor production: Though India has huge potential for production for castor crop and export of castor oil.

But there are certain challenges to harness full commercial potential of this crop.

Few challenges are Price realization front: Despite India’s dominant position in the market, it is not

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a price setter, but merely a price-taker because of the lack of an alternative market.

In India, the domestic consumption of castor oil is very limited and the oil is mainly exported. Therefore, the price of the oil is affected by many international concerns and the value of US dolor. To boost domestic consumption of castor oil, castor oil based hair oils were once popular in India, but have disappeared, and hence need to be revived. The used of castor oil, for preservation of cereals, pulses (mostly used in Gujarat) should be promoted in other parts of the country.

Considering its important industrial applications and its derivatives, higher domestic consumption of castor oil will boost the castor oil industry.

Though India meets most of the world’s requirement of castor oil but unable to capitalize it. India continues to export the oil rather than add value to it. India buys back own castor oil as formulated products and derivatives at many times the price of the oil. The production of oil and derivatives is in the ratio of 6:2.

Much of the research and development for newer applications of castor oil is taking place in Europe and elsewhere. It is also important that India should develops value-added products and gives due importance to research and technology.

The value addition in India will further increase the revenue generated from the export.

Production front: Castor, under irrigated condition, is a long duration crop. Many times farmers are unable to get sufficient quantity of good quality of seeds. To develop and maintain the vigour in seeds is a challenge to the agricultural researchers.

Irrigation and spacing should be adopted as recommended to get better production.

The technological innovation is required to develop better tools for harvesting and drying. To increase castor productivity poor soil and crop management should not be overlooked by pumping in more and more fertilisers and making the

soil almost totally fertiliser dependent.

Without knowing the soil nutrient status and crop requirement, the fertilisers are used on a blanket recommendation basis.

Same blind fertiliser recommendations should not be practiced in all castor growing area, and for all the varieties or hybrids of castor.

Therefore soil testing is must. Many castor growing soils are low in inherent fertility and hence addition of external nutrients is essential to get desired yield.

For this Integrated Nutrient Management (INM) must be followed. The reduced use of organic manures evident over the past few years is a further a cause of soil deterioration. The tropical and subtropical soils are low in available P due to P fixation with 90 % of soluble P converted to unavailable form (locked either with Al, Fe or Ca). Depending on the availability of biofertilisers viz. Azotobacter, Azospirillium and Phosphate Solubilising Bacteria should be used. All ways of addition of nutrient should be looked into for their balanced and judicious use. Use of optimum plant population, maintain required spacing and irrigation cycles, timely soil amendments like gypsum are the key contributing factors for increased production. The efficiency of nutrients can be increased by foliar application.

The estimated loss of production because of pest and disease is about 10-15 per cent. Sometimes for some area this figure crosses over 50 per cent and creating panic situation. While the uses of chemical pesticides over the past 40 years have increased castor yields but there have been some undesirable effects including development of immunity to pesticides, and environmental contamination. The pesticide usage should be brought under control by following integrated pest management (IPM), applying pesticide only when pest population exceeds the tolerable economic threshold. Resistance to pest and disease varies or hybrids should be promoted.

Opportunities for Indian Castor Industry: Big domestic market: The castor oil prices are decided by the international buyers and most of castor oil is exported.

Captive demand of castor oil is limited.

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Castor The most of Indian firms are exporting castor oil in its raw form while there are great potential for exporting the value added derivatives of castor oil, which will be more remunerative to the processors and exporters. Castor oil industry should exploit the potential of domestic market because India is the biggest consumer of the value added products of castor oil.

Value added products and by-products: India is enjoying monopolistic leader in the castor production and export. Most of castor is being exported as raw castor oil or first order by-products (like HAS).

The focus should be made to develop some quality higher order value added by-products so that India could earn more revenue from castor export. Besides, better opportunity will be developed in India itself to make finished products to make ultimate profit from the castor oil.

Alternative incomes: The leaves of castor can be used to rate silkworm, which could be an alternative source to the farmers.

Some organically grown castor oil extracted from cold press method may be promoted for its medicinal values. Castor leaves should be utilized for preparation of bio-pesticide when it is required for other crops. The mahogany castor flower should be promoted as ornaments in nearby cities.

Conclusion: The castor is an export oriented unique crop with a monopolistic status in productio and productivity front.

India’s leading position shuld be made more reminerative by value addition and research on derivatives. The industry has lot of potential in domestic and international market too. There are some inherent problems associated with the industry. Duly attention should be given to the setbacks of the industry to flourish it therefore the farmers who cultivate castor.

Reference: FAO.2014. www.fao.org.

Nagraj. G, 1995. Quality and utility of oilseeds. Directorate of Oilseeds Research, Hyderabad. p.42.

Scholtz, V. and Da Silva, J. N. 2008.

Prospects and risks of the use of Castor oil as a fuel, Biomass and Bioenergy, vol 32, pp. 95-100.

Shah, S.K., Patel, P.S. and Patel, M.K. 2014. Prospects of Castor (Ricinus Communis L.) genotype for biodiesel production. GAU Journal of Research.

39:1, 28-34.

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Gelato;

It ain’t ice cream its health

Vol. 09 Issue 10 August 2014

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hat’s creamier than ice cream but with less fat content? What’s a great way to enjoy the fruits of the season? What’s as Italian as Tiramisu but with less than half as many calories?

If you have Gelato on your mind, you will agree that Gelato has now begun to replace ice cream as a favourite dessert for children and adults alike.

What regular ice cream and gelato have in common is the endless variety of ingredients and possible mixes; next to chocolate and vanilla flavor are extravagancies such as tomato-basil, red bean and sesame.

For many Gelato graduates it’s the start of a second career But the initial similarities may be deceiving, as the two products differ significantly: Gelato cream consists of around 30 percent air, but regular ice cream may easily have double that. And while gelato ranges between six and eight percent fat, ice cream has usually around nine per cent or more. Typical ice cream is about 12 or 13 percent. So gelato is much healthier. And its temperature is higher, so it’s less cold. That makes the gelato more pleasant, and gives it a more creamy effect that is loved by the consumers.

You may find it weird or unbelievable but now we do have an institution that teaches all about the Gelato technology. This certainly appears true for the Carpigiani Gelato University itself. Founded in 2003, it has now stretched far beyond its original campus in Italy, and operates eight schools around the world with locations including Tokyo, Shanghai, and Buenos Aires. Every year more than 6,000 would-be gelato entrepreneurs from all over the world register themselves for a scoop of fresh knowledge.

The Indian picture The Gelato Industry in India is relatively new and developing to find its foot holds among the consumers. The premium gourmet product that originated in Italy is slowly carving its share in the Frozen Dessert market.

Gelato generally is considered as an ice cream, but technically the product is different. The frozen dessert is a low fat and high flavoured product. Unlike the most industrial ice creams, it is prepared from fresh and natural ingredients. The

Gelato made its entry in the Indian market some eight years ago and basically caters to the premium consumer. With not many players in this niche business segment, there is lot of scope and untapped market to take advantage of. Currently, there are about 10 Gelato brands and 100 gelaterias or gelato stores in the country.

Rulers of the Gelato industry The Gelato concept in India is infancy and still developing. Several Gelato brands such as Gelato Delight, Mama Mia, Gelato Italiano, Amore and Gelato Vinto etc are the pioneers in this sector in India. Most of them operate through company owned stores and some of them have forayed into the franchise arena to scale up and expand their brand and product reach. As, ‘Gelato’ is a premium product, the ideal distribution format for it, could be retail-kiosks and gelaterias or parlours, catering services, supermarkets supply and via institutional sales.

Franchise prospect The gelato brands namely Gelato Vinto, Amore and Gelato Italiano offer franchise opportunities in India along with presence through own stores.

Gelato Vinto The Delhi based brand launched in 2005

by Shivram Foods Pvt Ltd. has launched its franchise concept pan India. Gelato Vinto currently has presence in Delhi/ NCR, UP, Rajasthan, Maharashtra and Punjab through 25 franchised and 11 company owned outlets. It also has a supply channel for Hyatt Regency, Leela Kempinski and several other hotels and restaurants in the city. Now, the company is planning further expansion. It is offering franchisees and the interested entrepreneurs require paying a one-time franchise fee. The preferred location would be high footfall areas like ground floor of a market or shopping mall or a food court and minimum space needed would be 100 sq. ft. The company also extends technical knowledge and support to its franchisees.

Amore Mumbai based gelato brand Amore owned by Gourmet Gelato Company Pvt. Ltd. began operations in 2006 in India. At present, the brand has presence in Mumbai,

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Health Food Surat and Hyderabad through 25 outlets operating through mix of ownership as well as franchise model. The company opted for franchising in its endeavor to establish itself as a national brand.

It is also seeking continual expansion across India. The company provides personalised all-level management support in form of well-trained craftsmen, marketing, human resources or product enquiries. The franchise formats, the company offers include kiosks (space required 80-160 sq.ft.) and high street outlet (140-300 sq. ft). The capital outlay on franchisee’s end could vary between Rs 9 lakh-15 lakh for kiosk and high street format respectively approximately. This would also incorporate the franchise fee and costs for equipment and fittings, staff training, architectural and design fees etc.

Gelato Italiano The Gelato chain owned by Mumbai based Blue Food Company currently has around 60 outlets in cities Delhi, Mumbai, Kolkata, Pune, Hyderabad and Bangalore. The company is now on an expansion spree and looking to extend its presence across India through a franchise route in addition to company owned stores. It is targeting in Tier I cities for initial phase of expansion and to Tier II and III cities later on. It has plans to open more than 60 outlets pan India and has not disclosed the capital requirement for the proposed quick expansion as yet.

The Gelato industry challenges in India The Gelato Gourmet Industry has several factors that are critical for its growth prospects. These include issues pertaining to the supply chain mechanism, the infrastructure requirements, enhancing product awareness along with increasing consumer base for this specialty product.

Supply chain Management The shelf life of the gelato is of few days only and mostly, it is freshly prepared and sold on daily basis. Therefore, the franchisors prefer having a manufacturing unit close to the franchise stores. The franchisee would need to place orders in advance mostly 24 hours, so that the franchisor is able to supply the stock on time.

Infrastructure

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The refrigeration and display cabinets are typical and different from those used in regular ice-cream stores. This is due to the fact that ‘Gealto’ is 10 to 15 degrees warmer than ice cream and requires different temperature settings. Unlike ice cream, gelato is not completely frozen solid. Moreover, the equipment is sourced from Italy and usually supplied by the franchisor. The Gelato manufacturing involves typical recipes, equipments, production process and store formats.

Lack of product knowledge Gelato has still has to carve its identity as a different product other than ice cream. A large section of consumers are not able to differentiate between ice cream and Gelato. In case of ice cream, the content ratio of ice cream to air is 30:70 and for Gelato, this ratio is typically 70:30. Gelato is prepared from

natural ingredients (milk and fruits), and is mostly fat free (only 3 to 4 percent of fat) and is more creamy, rich and tasty and therefore nutritious. However, the variations in gelato containing chocolate or nuts are more calorised. Also, there are other gelato products available such as water based Sorbettos, Gelato Cakes and shakes.

Small consumer base: As if now, Gelato industry in India is a very small catering to a niche market. Its consumer base comprises those foodies who have knowledge and appreciation for the quality food ingredients and its history.

The product is 100 percent costlier than any other regular branded ice cream.

Also, with many options available in the category of Frozen Desserts and ice creams, the gelato finds clientele in people who have a more refined palate. The

Health Food current scenario is that the gelato market is limited to metros and Tier I cities.

In the end Generally, seen as part of the Ice Cream industry which is Rs 3,000-crore organized ice-cream market in India in 2014 and pegged at annual growth rate of 15 per cent for coming years, the share of gelato market is very small about five per cent. There is massive scope in this premium gourmet segment in terms of creating product awareness and identity in the Indian market. As more and more people are becoming health conscious and also ready to spend, the sector offers potential entrepreneurial opportunity. The trend is picking up with several players planning expansion and seeking franchise partners to extend the reach of the product across India and creating a larger consumer base.

Pepsi introducing juice from cashew apples in India

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his season Pepsi is betting that the tangy, sweet juice from cashew apples that can be the next coconut water or acai juice.

“Coconut, pomegranate and lime juices are popular, but affordability is becoming a major issue,” said V.D. Sarma, vice president for global procurement at PepsiCo India. “So we are always looking for new juice sources that are locally produced to help bring prices down for us and for consumers.”

Starting next year, cashew juice will go into a mixed fruit juice drink sold in India under the Tropicana label, replacing more expensive juices like apple, pineapple and banana.

Eventually, the company hopes to add it to drinks around the world.

“The cashew apple is exotic and appealing, and Pepsi thinks it is a premium product.”

Farmers here are a bit baffled by Pepsi’s interest in their cashew apples.

While the cashew is a favorite nut worldwide, the so-called apple from which each nut grows is almost always left on the ground or thrown away, where it begins to ferment within 24 hours of picking. And the juice by itself, while highly nutritious, is abundant in tannins that impart an acrid taste.

Pepsi stumbled across the fruit in Brazil a

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few years ago, when Mehmood Khan, its global head of research and development, was working there to get the company’s coconut water business up and running. A local supplier took him to a cashew orchard, where he saw the colorful apples and wondered how they could be used.

To help improve the farming, collection and rapid processing of the apples, Pepsi turned to the Clinton Foundation, which had expressed interested in the company’s efforts to incorporate small farmers into its global supply chains. Small farmers supply it with chickpeas in Ethiopia and corn and sunflowers in Mexico.

“We work with them to improve cultivation and yields and offer them better prices for their nuts as well as create a market for their cashew apples,” said Govind Ramachandran, general manager of Acceso Cashew Enterprise, the business established by the Clinton Foundation last December to carry out the program in India.

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Foodtec

Great opportunity for Indian companies to enter

Russian

food market

A

jay Kamalakaran In the wake of Russia’s one-year ban on imports of food products that imposed sanctions on Russia, India could become a major exporter of buffalo meat, processed food and dairy products to the country.

The years following the 1998 financial crisis and subsequent Russian debt default presented one of the best opportunities for exporters of Indian agricultural produce to enter the Russian market. A lack of interest, information and prevalence of stereotypes about Russia kept Indian exporters from entering Russia. It was precisely around that time the Europeans, Americans and even the Chinese moved back in and completely captured the Russian market.

A visit to any supermarket in a Russian city will show how much the country depends on imported food. One would be hard pressed to find anything of Indian

origin besides certain spices and tea. The Russian government’s decision to ban fruit, vegetables, meat, fish, milk and dairy imports from the U.S. the European Union, Australia, Canada and other countries that have imposed sanctions on Moscow, is a great opportunity for Indian exporters to enter the Russian food market.

According to India’s Agricultural and Processed Food Products Export Development Authority (APEDA), buffalo meat exports amounted to $4.3 billion in the 2013-14. India houses almost 60 percent of the world’s buffalo population, and the animal is not considered sacred unlike cows, making it the ideal beef substitute. There were some concerns in Russia about the conditions that buffalo grazed in India, but Indian buffalo meat has been exported to countries like Malaysia, Mauritius and the Seychelles, which have had no outbreak

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of foot-and-mouth disease.

Russian agriculture and veterinary sanitation inspectors should be invited to India to inspect the conditions for themselves.

This should help address their concerns about buffalo meat exported from India.

India needed to play hardball to get the Russian ban on egg products and nonbasmati rice lifted last year, but given the fact that one of Russia’s top priorities is to control food inflation, it is unlikely that Moscow will go beyond demanding its normal sanitary standards when dealing with New Delhi over the import of meat and poultry products.

There’s also a great opportunity for one of India’s biggest success stories, Amul, to get a presence in Russia. The serious shortfall in dairy and cheese products means, the Indian cooperative can at least manage to get a small presence in Russia.

India exported $540 million worth of dairy products in the last financial year

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according to APEDA figures.

The Russian market Indian exporters of agricultural consumer products would be well served to get in touch with Moscow’s small but knowledgeable Indian Diaspora. Many members of the Indian community in the Russian capital have cut their teeth and have a great degree of expertise about the complex market. For Indian food products to do well in Russia, a combination of good marketing and attractive packaging is a must along with quality products.

One of the great success stories in Russia is the Sri Lankan tea industry, which came out of nowhere and captured the market, which was dominated by India for decades. Brands like Dilmah are a household name in Russia and Mlesna tea centres can be found in the GUM department store as well as Moscow’s Domodedovo airport.

Of course, it’s not just Indian exporters

of agricultural products that stand to gain from strained ties between Russia and the West. The Mint reported that India’s Commerce Ministry has worked out a strategy to export 24 items that Russia usually buys from the U.S. and European Union. These include optics, electrical machinery, pharmaceuticals and plastics, according to the paper.

North South corridor Now that Russia has decided to bypass sanctions on Iran and signed a MoU to intensify economic cooperation, India along with the two countries can push for marked progress on the North-South Transport corridor.

The corridor project envisages a ship, rail and road route that connects ports on India’s west coast to Bandar Abbas in Iran, then overland to Bandar Anzali port on the Caspian Sea and through former Soviet republics right up to Russia.

Trade The route could via either Armenia and Georgia or the more practical option of Azerbaijan and Kazakhstan.

An inter-governmental agreement on the corridor was signed between Russia, Iran, India and Oman, back in 2001, but there has been very little progress in making it functional. Now more than ever, Russia needs to push for all the railway connections to be built at a rapid rate to make the corridor functional.

This functioning of the corridor would also open Russia and many former Soviet states to India’s fruit and vegetable exporters in years when India has a bumper crop.

It is not clear how long Russia’s impasse with the West will last, but this is as good a time as any for Indian businesses to rediscover a country that was one of India’s biggest trade partners in the 1970s and 80s.

TGB announces guidelines to sustainable beverage production and consumption

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ata Global Beverages (TGB), has declared their plans for 100 percent sustainable sourcing by

2020.

Tata Global Beverages’ sustainability strategy rests on five key pillars, of which Sourcing is one. The five pillars are Ethical Sourcing, Water Management, Climate Change Management, Waste Management and Community Development.

Tata Global Beverages is one of the founding members of trustea, a multi stakeholder initiative led by the Tea Board of India. The Trustea India Sustainability Tea Programme envisions verifying over 600 factories, covering 500,000 workers and 40,000 small holders by December 2014.

The Tea Board of India through its Trustea initiative and the launch of a new Plant Protection Code (PPC) in July this year announced their plans to certify 500 million kg of tea, amounting to 51 per cent of India’s tea supply by 2017.

The company’s sustainable sourcing strategy has a major focus on sustainable agricultural practices. A key component of this effort aims at achieving optimum productivity, and gradually reducing the dependence on synthetic inputs in the form of Plant Protection Formulas.

Tata Global Beverages’ commitment to

reducing the use of synthetic Plant Protection Formulations, in the supply chain, is an integral part of TGBs commitment to greater.

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Ajoy Misra, MD and CEO of Tata Global Beverages said, “As a responsible player in the natural beverages segment, TGB cares deeply about sustainability and recognises the importance of systematically reducing the use of Plant Protection Products in the tea industry and have been proactively advocating for the same. From bush to cup, we are always conscious of our obligation towards our consumers and seek continuously to maintain and improve the quality of tea production, delivering not just to norms but above and beyond them wherever viable.”

Tata Global Beverages is in full support of independent third party certifications of sustainable agriculture such as Rain Forest Alliance, Trustea or UTZ from our tea suppliers as evidence that the tea they supply to us is sustainably sourced.

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News

Lindt pulls out of India weary over FSSAI’s import issues

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indt, among the most popular imported chocolate in the country, has decided to pull out of in India after two of its consignments were sent back due to non-compliance with new rules imposed by the Food Safety and Standards Authority of India (FSSAI).

Jeevan Verma, the country manager for Lindt India says, “It’s a business decision taken by Lindt. It is not easy to comply

with rules so fast,” who has now been reassigned as business head for the Narang Group, which holds distribution rights for Lindt & Sprungli.

However, the marketing team, which was directly employed by the Swiss chocolatemakers, lost its job.

It all began in August 2013 when three consignments were stopped at ports in Mumbai after FSSAI announced new regulations on its website. “We suffered most losses then because August is when we procure the biggest orders, considering the festive season,” Verma said. Imported packaged foods consignments worth nearly Rs 750-1,000 crore were held back, of which one-third was chocolates.

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The new guidelines required the ingredients to appear in descending order of their composition by weight or volume at the time of its manufacture. Lindt adapted to these new regulations specifically for India, and sent a fresh consignment in January 2014.

This, too, was stopped due to another new rule which stipulated that chocolates with vegetable oil or fat would not be allowed. A smaller consignment adhering to the ‘no vegetable oil or fat’ rule was imported, but was stopped as now the FSSAI wanted the manufacturers to mention the use of artificial flavours on the label.

With business hit drastically, Lindt &Sprungli is contemplating seeking legal recourse. “Some brands have managed to get a stay order and have been able to get their products moving. Lindt too is contemplating moving court,” an official stated.

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Sanwaria Agro plans on 60 per cent revenue in 3 years from its branded segment

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anwaria Agro Oils plans to extract 60 per cent revenue from its branded segment in three years and is planning to launch rice bran oil in six months.Sanwaria Agro Oils’ whole-time Director Anil Agrawal said that they want to expand their retail segment and strengthen brands and thus are targeting to increase the revenue from branded segment to about to 60:40 in 2-3 years.

This Madhya Pradesh-based edible oil maker currently gets a hold of 15 per cent revenue from the branded segment and 85 per cent from bulk business.Sanwaria Agro Oils is planning a capex of up to Rs 300 crore for the next two years subject to the approval of shareholders.Sanwaria is planning a capex of Rs 200-300 crore for the next two years. The board of the

company has already approved it. We are now waiting for shareholders’ approval in our annual general meeting to be held soon,” Anil Agrawal added.The company is planning to introduce rice bran oil in next six months, Agrawal said.“We have our own rice mills for processing basmati rice and can easily produce rice bran oil from our units. So, we decided to explore this and worked adding rice bran to our product portfolio. All the necessary things in this regard are in place and we will be introducing the new product in another six months time,” he added.The company currently has 200 tonnes per day capacity rice mill at Itarsi near Bhopal in Madhya Pradesh and is setting up another 400 tonnes per day capacity unit near it, which will be operational by December, he

K Global Ventures to develop palm oil plantation in Guinea

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he Republic of Guinea has selected Malaysia-based K Global Ventures (KGV) to develop a palm oil plantation in the country.

Guinea’s Trade Minister Marc Yombouno has signed an agreement with KGV director DatukAnnuarZaini Binyamin to develop 100,000 hectares in Guinea to grow and process palm oil.

According to the minister, if palm oil is successfully planted by the first quarter of

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2015, and if the undertaking is completed within five years from then, Guinea will provide land that will double the initial offer.

MrYombouno said: “We are impressed with Malaysia’s progress and achievements in the palm oil sector. We are seeking Malaysian investors and expertise in palm oil.”

The minister also said that the 100,000 hectares has been offered to the Malaysian company on the basis of a feasibility study based on the new investment laws of the Republic.

Mr Binyamin noted that, in Malaysia, 100,000 hectares of palm oil would generate around RM2bn ($62m) revenue.

KGV will send a technical team to Guinea in the next two or three months, in order to assess the conditions for plantation.

Oil & Fats News said.This company exports the premium basmati rice to the Middle East, South East Asia, Europe and Iran. The demand for its basmati rice is growing. So, to keep up with the demand, they have decided to add another rice processing unit.

CONFECTIONERY DEVELOPERS BENEFIT FROM DDW’S OIL DISPERSIBLE COLOUR TECHNOLOGY

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ouisville, Kentucky USA (28 July 2014) – Developers of confectionery products have gained more natural colour options for fat-based systems.

DDW’s newest proprietary technology has broadened the natural range of oil dispersible brown, blue, green, purple and pink hues that originate from water soluble colour. Applications include compound coatings for confectionery, inclusions and frozen novelties, as well as fat-based fillings.

“Based on customer feedback from our initial launch in 2012, we redesigned our technology to accommodate additional requests for simple label colours in compound coatings,” said Jody RennerNantz, Senior Application Scientist.

“Customers in several countries have formulated the innovative DDW colours without emulsifiers.”

DDW’s innovation has expanded the scope of colour derived from natural sources that can now be added to lipid systems and replace blends of artificial red, yellow and blue lakes. For samples and technical support, please contact a DDW representative or e-mail: info@ ddwcolour.com Additional image of multi-colored compound coatings available upon request.

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Food Processing New

Lay’s® Canada announces 2014 Do Us a Flavour™ finalists

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fter receiving more than one million flavour submissions from fans coast to coast, Lay’s Canada today revealed the four finalist flavours of its 2014 Lay’s Do Us a Flavour contest: • Bacon Poutine on Lay’s Original by Guillaume Lorrain from Trois-Rivières, Quebec • Cinnamon Bun on Lay’s Original by Gloria Melanson from London, Ontario • Jalapeño Mac N’ Cheese on Lay’s Wavy

by Randall Litman from Calgary, Alberta • Tzatziki on Lay’s Kettle Cooked by Denise Vella from Cambridge, Ontario It’s now up to Canada to decide the winning flavour by trying all four and voting for the yummiest from August 12 until October 15. Canadians can vote once per day on each of the following platforms: • Lays.ca/Flavour • Tweet using vote and one of the flavour finalist hashtags (i.e. #VoteFlavourName) • Instagram using vote and one of the flavour finalist hashtags (i.e. #VoteFlavourName) • Text VOTE to 101010 In February, the Lay’s Do Us a Flavour contest challenged Canadians to submit their ideas for the next great potato chip flavour for a chance to win $50,000 plus one per cent of their flavour’s future sales once the voting period ends. In less than two months, the contest received an overwhelming response almost doubling the number of submissions received in 2013, its inaugural year. The volume of Do Us a Flavour ideas reflects Canadians’ passion for Lay’s, the country’s favourite potato chip brand.

“We were blown away by the tremendous creativity and passion that Canadians brought to this year’s contest. There were

over a million amazing ideas submitted, so selecting our four Do Us a Flavour

finalists was not an easy task!” says Susan Irving, Director of Marketing, PepsiCo Food Canada. “The challenge ahead for these flavours is to win the votes of chip aficionados across the country and become the next addition to our flavour lineup. We can’t wait to see what Canadians decide.”

All four finalist flavours will be available in stores across the country at the beginning of August for a limited time. After October 15, votes will be tallied and the next great Lay’s potato chip flavour will be announced and launched into market in late November.

As part of this year’s contest, television personality James Cunningham teams up with the Lay’s Do Us a Flavour contest to inspire Canadians to vote for the yummiest flavour. A food explorer, James is passionate about discovering great flavours through his intrepid culinary adventures and food truck finds.

“The creative mix of finalist flavours is a great reflection of this country’s passion for culinary creativity,” says James Cunningham, host of Eat St. “As the voting period kicks off, I encourage all Canadians to celebrate this creativity by trying all four and voting for the yummiest flavour.”

The inspiration behind the four flavours: Bacon Poutine on Lay’s Original: Guillaume Lorrain from Trois-Rivières, Que-

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bec created this Lay’s flavour as an ode to his youth. When he was young, every once in awhile when his mom wasn’t home to cook dinner, as a treat, his dad would take him out for a Bacon Poutine dinner.

Cinnamon Bun on Lay’s Original: Remember when you went to Grandma’s house and it smelled so good? Straight from Grammas’ kitchen, London, Ontario’s Gloria Melanson’s flavour inspiration is the waft of warm gooey cinnamon buns made with cinnamon and brown sugar baking away in the oven.

Jalapeño Mac N’ Cheese on Lay’s Wavy: At summer barbeques, everything ends up on one plate and this is what inspired Calgary, Alberta’s Randall Litman to create Jalapeño Mac N’ Cheese. His favourite combination is when Lay’s Potato Chips end up next to macaroni salad - adding some jalapeño gives it a nice kick!

Tzatziki on Lay’s Kettle Cooked: Denise Vella from Cambridge, Ontario fell in love with Greek food twice, which inspired her Tzatziki flavour. The first time was while backpacking through Europe after University and she fell for Greek food again when she lived on the Danforth in Toronto. The flavours in Tzatziki take her back 20 years... Yummy!

The Lay’s Do Us a Flavour contest has been held in numerous countries around the world and has generated an incredible response with millions of flavour submissions. Last year, the Canadian contest received more than 600,000 flavour ideas from fans across the country. From the UK to India, Australia to South Africa and most recently the US, the Do Us a Flavour campaign has resulted in a wide spectrum of chip flavour ideas created by consumers including Caesar Salad (Australia), Chili & Chocolate (UK), Mastana Mango (India), Walkie Talkie Chicken (South Africa) and Cheesy Garlic Bread (US)

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News

National Best Entrepreneur Award’ in food processing for this Woman

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t has been a long journey for 42-year-old Chayaa Nanjappa. But she has had tough going and today heads a rural enterprise which produces high-quality honey that sweetens many a home even in Europe and the United States.

Chayaa now has been awarded for her hard work with ‘National Best Entrepreneur Award’ in food processing

by the Confederation of Women Entrepreneurs of India.

Success to her has not been easy, but now this self-made woman provides a livelihood for not only many illiterates of Mysore and Mandya districts, but also some tribals across the state. She is also the largest buyer of forest honey from Malayalis and tribes like Siddis and Jenu Kurubas.

Her enterprise Nectar Fresh, which produces monofloral honey, has a capacity of 200 tonnes and is worth `6 crore. It is one of the largest bulk suppliers and packers of honey in the country and falls in the top five bulk exporters of raw as well

Indian dairy sector dead against free access market access to New Zealand

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he Indian dairy sector is irked over New Zealand’s renewed effort to secure a preferential trade access to the Indian market. Dairy co-operatives and private sector players are against granting any preferential access in the Indian market through a free trade agreement (FTA) to New Zealand, the world’s largest exporter of milk products.

India is the only country in Asia that’s self sufficient in milk production. Granting any free market access to New Zealand will not only hit our farmers hard, but will also expose the consumers to volatility of world markets according to

RS Sodhi, Managing Director of Gujarat Co-operative Milk Marketing Federation (GCMMF).

India is among the fastest growing dairy markets and the rapid rise in milk prices – by 1517 per cent over the past one year has been a concern.

Milk production was estimated at 132.43 million tonnes in 2012-13 and was targeted to reach 139.67 mt in 2013-14.

India turned a net exporter of dairy products in 2013-14 with skimmed milk

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as processed honey. Nectar Fresh also has the ISO 22000:2005 certification.

To earn her brand a significant international presence, she decided to market it as a basket of products, including jams and sauces. The result: it found a place in the European market.

With exports to Germany and France, Nectar Fresh has broken the monopoly of global companies like Bereenberg, Darbo and Bonne Maman. “We met the stringent standards necessary for approval to export to Germany and made a strong impact by packaging our honey and jam in polypropylene sachets for high quality and shelf life. The European competitors feel threatened by our presence,” said Chayaa, who is now busy tying up with a Saudi Arabian company for the production of jams from dates. powder shipments of over 1.22 lakh tonnes. Total value of dairy products shipments were estimated at over 3,318 crore. But with the decline in global price on improved supplies, the exports of SMP from India are currently seen unviable as domestic prices are high.

New Zealand is in search of a large market for its dairy products, especially after the Fonterra contamination scare last year that led to slowdown in dairy exports to China, its largest buyer.

With the change in Government and the rising milk prices presenting an opportunity, New Zealand has renewed its efforts to gain a preferential market access to the Indian market. A high level New Zealand delegation is in Delhi exploring the opportunity.

At the India-New Zealand Dairy Dialogue, organised by the Agriculture Ministry early this week, the Indian players made it clear that the country was self sufficient in milk production and does not need any imports now. Some players were also surprised at the Ministry’s haste in arranging the dialogue without taking the domestic industry into confidence.

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