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AgriBusiness & Food Industry w June 2012


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inside...

Cover Feature

Trade Exhibitions Rocketing Agri Exports & Tourism

– S Jafar Naqvi & TV Satyanarayanan

Interview

Meat Industry ...12

...24

...28

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Holland partners with the most relevant & high potential exhibitions – Henk van Duijn

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Participation has to be impressive and qualitative – Tarun Bajaj

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Challenge lies in getting right mix of exhibitors & trade visitors – Sumit Saran

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Good exhibitors are country's best brand ambassadors – Piruz Khambatta

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Exhibitions impact a lot in creating awareness about Indian oilseeds

Meat Export

India’s Buffalo Meat in Great Demand in Overseas Agri Affairs ...22

38th Special Session of CFS Reflecting India’s leadership in farming sector — Sanjeev Chopra

– Rajesh Bheda 38 Indian

exporters miss prominent locations in overseas expos due to late booking

– Yogita Taneja Kackar

Trade Relations

Iran Trade Delegation in India

Problem —

Banking! Banking! Banking!

Solution — Tejarat! Tejarat! Tejarat! — says Yahya Ale-Eshagh

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AgriBusiness & Food Industry w June 2012

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EDITORIAL

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Honey industry

Outrageous fortune for honey trade

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press release

HRS Process Systems launches ‘HRS ParaDice’

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RETAIL NEWS

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CORPORATE NEWS

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FOOD & BEVERAGES NEWS

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MARINE NEWS

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DAIRY NEWS

...40

Surprising trends that will reshape honey market in the next decade


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C

Chief Editor

S. Jafar Naqvi

Consulting Editors

T.V. Satyanarayanan K Dharmarajan

Chief Co-ordinator

M.B. Naqvi

Editorial Co-ordinator Syed M K News Editor Anwar Huda General Manager Lalitha V. Rajan Layout & Design Faiyaz Ahmad Mohd. Iqbal Head Office New Delhi: +91-11-26682045 / 26681671 / 64521572 Fax : +91-11-26681671 mediatoday@vsnl.com Other Business Offices Hyderabad 9248669027 hyderabad@mediatoday.in Mumbai 9702903993 mumbai.office@mediatoday.in Pune 9881137397 pune@mediatoday.in Bangalore

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Printed, published and owned by M.B. Naqvi, Printed at Everest Press, E-49/8, Okhla Industrial Area Ph-II, New Delhi - 110 020 and Published from E-11/47 A, New Colony, Hauz Rani, Malviya Nagar, New Delhi-110017 (INDIA)

Editor : S. Jafar Naqvi

Vol 9....... Issue 6 ...... June 2012

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orial Edit

oncerns are being voiced on the world’s ability to feed its growing population by 2050. According to experts’ projections, the world would need, by the middle of this century, at least 70 per cent more food than what is produced today to feed an expected population of 9 billion -- two billion more than at present – that would include some hitherto considered poorer sections of people, whose consumption patterns are changing because of rising incomes. True, researchers around the globe are putting in extra efforts to increase both production and productivity of food crops. New techniques are being evolved and popularised in planting, watering, harvesting and storing of food. Besides efforts to spread hybrid varieties of crops giving higher yields, new hardy varieties are being tried out to withstand natural disasters like flood and drought. Some of the new varieties are tailored to withstand submergence for more than two weeks. Similarly, efforts are being made, with considerable success, in the utilization of saline and alkaline lands, which by and large have remained barren. A news item appearing in a recent issue of International Herald Tribune gives some details of a new project taken up by a Japanese farm research team to develop new salt-tolerant varieties of rice, particularly for areas devastated by Tsunami waves, up to 40 metres high, in Miyagi Prefecture in north-eastern Japan. . The damage caused to vast stretches of agricultural land in this area is estimated at $ 4.6 billion. Traditionally, a major crop in north-eastern Japan has been rice, but tsunami has wreaked havoc in coastal farmlands, leaving large deposits of sodium chloride. Salt damage can cut yield of rice crop by half, say researchers at Miyagi Prefecture’s Furukawa Agricultural Experiment Station in Osaki city and Tohoku University in Sendai, who are working with Riken’s Nishina Center in Wako city, north of Tokyo. While research bodies in India like Karnal-based Central Soil Salinity Research Institute under ICAR are working on rice crops suitable for growing in saline and alkaline soils, the Japanese institutes are said to be working on different techniques to speed up mutation of plants. Scientists at Riken, a reputed independent research body, have been using heavy ion beam technology, which has wider use in medical treatment like fighting cancer. Usage of this technology for plant mutation has been going on in the institute for over two decades. The efforts led to development of a salt-resistant variety, but taste was not its strong point. In the current project at Riken, grains of two popular rice varieties have been exposed to heavy ion beams. According to these scientists, the traditional types of plant mutation, using X-rays or gamma rays, are a long-winding process, taking days or weeks, but the heavy ion beams technique needs to be employed only for seconds or minutes. Moreover, the survival rate of exposed plants is much higher because of less damage done to their overall DNA. As a scientist put it, it takes years to develop a new variety using traditional methods, but the new method shortens the cycle considerably. Of course, innovations are an ongoing process in every field of research. To keep pace with the growing global demand for food, what is needed is a multi-pronged approach to suit different agriculture systems and situations. At this critical juncture, most important is to fashion such an approach to promote sustainable agriculture development.

Comments are welcome at: mediatoday@vsnl.com Views expressed by individuals and contributors in the magazine are their own and do not necessarily represent the views of “AgriBusiness & Food Industry” editorial board. AgriBusiness & Food Industry does not accept any responsibility of any direct, indirect or consequential damage caused to any party due to views expressed by any one or more persons in the trade. All disputes are to be referred to Delhi Jurisdiction only. .....Editor

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Meat Industry

Meat Export

India’s Buffalo Meat in Great Demand in Overseas Markets Media Today Group is organizing ‘Poultry & Livestock Expo 2012’ at Palace Ground, Bangalore on 25-26-27 August, 2012. This would bring under one roof leading poultry and Livestock players of India, specially Poultry and Dairy equipment manufacturers, breeders, food products exporters, experts and leaders from the industry, along with, of course, farmers' delegations – in fact all stakeholders. This event is being held concurrently with 2nd DairyTech India, 4th India Food Expo 2012, 3rd Grain Tech India 2012 and 4th Agri Tech India. On this occasion, it would be worthwhile to take a look at the growth of Indian meat industry, including poultry and livestock. Here is a bird’s eye-view of the developments in this important sector. Facts and figures have been quoted from Indian Meat Industry – Red Meat Manual by S K Ranjhan & A S Rawat

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ince time immemorial, man has been a meat eating species. Well before agriculture started, man used to hunt animals for food. Even today, the majority of the world population is non-vegetarian. Man loves to eat meat and will do so as long as he gets it. Rising global demand Today, more and more countries are coming out of poverty and joining the industrial, meat -eating world, which makes a rapid increase in demand inevitable. As developing countries become more urbanized and their citizens enjoy a substantial income increase, individuals tend to buy the foods that were out of reach when they were poor, beef being one of the most popular. For this reason, beef demand has been growing most rapidly in Asia and the developing countries. Current global meat consumption is 280 million tons per year, but it will likely double by 2050 when the world's population is expected to reach nine billion. The largest consumers of beef on a per capita basis are in Argentina with an average 65.6 kg per year and Uruguay at 52.4 kg. But overall, the United States is the largest consumer, followed by the European Union, Brazil, China, and Argentina. Due to the economic downturn, there was a reduction in beef consumption and production in 2010, but rates have started recovering Even as beef consumption is expected to double by 2050 however, beef may no longer be a "mass product" and may instead become "the caviar of the future," according to Henning Steinfeld of the Food and Agriculture Organization of the United Nations because the resource requirements for the production of beef are three to five times higher than those of chicken. Growing Indian Exports India is the 8th largest producer of meat with export growing at the rate of 13 per cent over the last five years, according figures available with Agricultural and Processed

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Meat Industry Food Products Export Development Authority (APEDA). Per capita consumption of meat in India is just 4.5 kg in comparison to the world’s 46.64 kg. The total meat processing capacity in India is over 1 million tons per annum, of which 40-50 per cent is utilized. India exports more than 500,000 tons of meat, mostly buffalo meat. Indian buffalo meat is witnessing strong demand in international markets due to its lean character and near organic nature. Unlike cow slaughter, there is no social taboo in killing buffalo for meat. Goat and lamb meat are relatively small segments where local demand is outstripping supply. The production levels in these two categories have been almost constant at 950,000 tons with annual exports of less than 10,000 tons. The recent trend in India is to establish large abattoirs-cum-meat processing plants with the latest technology. India has already established ten state-of-art mechanized abattoirscum-meat processing plants in various states based on slaughtering buffaloes and sheep. These plants are environmentfriendly, and all the slaughterhouse byproducts are utilized in the production of meat-cum-bone meal, tallow, bone chips and other value-added products. Several more are under construction. The plants follow all the sanitary and phyto-sanitary measures required by the International Animal Health code of World Organization for Animal Health (O.I.E.). These plants mostly produce buffalo meat for export. India is becoming a major buffalo meat producing country and will be a main player in the international market with additional establishment of the state-of-art-abattoirs cum meat processing plants. Main Meat Production Areas: Andhra Pradesh, West Bengal, Maharashtra , Kerala, Delhi , Uttar Pradesh and Rajasthan are the key areas of processed meat production in India. The individual products under this subhead are: Sausages & Canned Meat Homogenized Meat Preparations Preserved Meats Other Poultry Meat Preserved Meat of Bovine Animals Meat Extracts & Meat Juices

India is becoming a major buffalo meat producing country and will be a main player in the international market with additional establishment of the state-of-art-abattoirs cum meat processing plants Animal Products Export: India's exports of Animal Products was Rs. 9817.39 crore in 2010-11, which included the major products like Buffalo Meat (Rs. 8312.69 crore), Sheep/ Goat Meat (Rs. 253.19 crore), In term of export from India, Animal Casing and Processed Meat recorded 11 per cent and 11.5 per cent growth respectively during the financial year 2010-11. Goat/Sheep Meat Export Goats and sheep constitute a very important species of livestock in India, mainly on account of their short generation intervals, higher rates of prolificacy, and the ease with which the goats as also their products can be marketed. They are considered to be very important for their contribution to the development of rural zones and people. The local initiatives to promote quality labels and innovative products for cheese, meat and fibres could help goats in keeping a role for sustainable development in an eco-friendly environment all over the world. However, the future of the goat and sheep industry as a significant economic activity will also be very dependent on the standards of living in the countries where there is a market for the goat products. Main Production Regions: Rajasthan, Jammu, Kashmir, Uttar Pradesh, Gujarat, Hilly regions of North and Eastern Himalays are the Indian regions with maximum livestock population. Export Figures: The country is largest exporter of

sheep/ goat meat to the world. The country has exported 11,908.39 tonnes of sheep/ goat meat to the world for the worth of Rs. 25,318.88 crore during the year 2010-11. Major Export Destinations (2010-11): Saudi Arabia, United Arab Emirates, Kuwait, Qatar, Oman, Iraq and Maldives. Export oriented units India's livestock population includes around 94.1 million buffaloes, which is 56.5 per cent of the world's buffalo population. Animals which are generally used for production of meat comprise of buffalo, sheep, goats and poultry. In the last one-year three new export oriented units of buffalo meat processing have been approved and are reportedly under implementation. In addition, there are few animal casing units engaged in collecting cleaning, grading and exporting sheep and goat and cattle guts. Buffalo Meat Production & export The major areas for Buffalo Meat production are Maharastra, Andhra Pradesh and UP. The country exported 7, 09,437.48 tonnes of buffalo meat products worth of Rs. 8412.69 crore. Vietnam Social Republic, Malaysia, Egypt, Arab Republic, Saudi Arabia, Philippines, Jordan, United Arab Emirates are the major export destinations (2010-11). ABATTOIRS Municipal Abattoirs Abattoirs or slaughter houses are the places where animals are killed to process meat into desired pieces. There are nearly 4000 abattoirs for domestic market in India. They are registered with local bodies. Apart from these, there are around 25000 unregistered slaughter houses. These slaughter houses do not maintain high level of hygiene and living or walking around them is no less than a curse. EOA There are 33 Export Oriented Abattoirs in the country. They are modern integrated units established on the guidelines give by APEDA.

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Meat Industry

US requests WTO to set up dispute settlement panel

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S Trade Representative Ron Kirk has announced that the US has requested the World Trade Organisation (WTO) establish a dispute settlement panel to decide US claims regarding the government of India’s restrictions on imports of various US agricultural products, including poultry meat and chicken eggs. “It is essential that US farmers obtain the reliable market access that India agreed to,” said Kirk in a press release. “The United States holds its agriculture industry to the highest standards of safety and is confident the WTO will agree that there is no justification for India's restrictions on US exports.” In response to announcement, the National Chicken Council, National Turkey Federation and USA Poultry & Egg Export Council released the following statement: “Unfortunately, the government of India did not lift its unwarranted restrictions on US poultry after consultations with the United States at the WTO in Geneva. However, we are pleased that USTR is taking the next step. We support the dispute settlement process moving forward as soon as possible with the formation of this panel.” India has long employed its own standards and trade restriction policies and has banned poultry imports from any country reporting avian influenza, even in cases of low pathogenicity. By conservative estimates, if India’s trade barriers were eliminated, the value of U.S. poultry exports to India each year would surpass $300 million.

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They follow world-class sanitary and phyto-sanitary measure, which is a mandatory requirement of HACCP and ISO Certification. USP of Indian Buffalo Meat The livestock in India is reared on green pastures and agricultural crop residues which is the main reason for healthy animals. There is no practice of using hormones, antibiotics or any other chemicals for fattening the stock. They are mostly organic. The Indian stock is free from dreaded Bovine Spongiform Encephalopathy (Mad Cow Disease), Rinderpest and CBPP certified by OIE. The Indian buffalo meat is 93 per cent chemically lean and blends very well with other ingredients for value added products. It is also free from radiation. The animals are slaughtered strictly according to Halal method which is necessary as most of the importing countries have Muslim population. Indian buffalo meat also blends very well with other types of meat and is low in fat and cholesterol. Animal welfare practices are adopted in export-oriented units (EOUs) which follow the guidelines given in Society for Prevention of Cruelty towards Animal (SPCA) Act, Animal Welfare Board and Bureau of Indian Standard (BIS), in the transport of animals to the abattoirs. APEDA’s Role Agricultural and Processed Food Products Export Development Authority (APEDA) makes it mandatory for the exporters to maintain high level of hygiene at slaughter houses and use stringent methods to produce processed meat. APEDA’s functions includes registrations of exporters, financial assistance for research studies and infrastructure upgradation, fixing of standards and specifications, carrying out inspection in abattoirs, storage houses and such other places, improvement of packaging and marketing, promotion and collection of statistics from exporters and researchers and training in various aspects. APEDA is one-stop shop for persons wanting to export meat and meat products. Rules for Exporters: The animal health certificates (necessary for exporters) are given by all State Directorates of Animal Husbandry,

AgriBusiness & Food Industry w June 2012

Export Inspection Agencies (EIAs), Directorate of Marketing and Inspection (DMI) and Deonar Abattoir, Mumbai (for chilled sheep and goat meat only). The export oriented units also have to follow the Hazard Analysis and Critical Control Points (HACCP). It is a control system designed to identify and prevent microbial and other hazards in meat production. BIS and The National Standard Authority of India (NSAI) have developed HACCAP and its guidelines for application. BIS also issues Quality Management Systems Certificates. The Halal certificates are issued by the representatives of Jamiat-e-Ulema-eHind as they must remain present at the time of slaughter. Apart from this, the animal and carcasses must be subjected to ante-mortem and post-mortem inspections by qualified veterinarian of the Central Government Agency. There is a stringent Quality Control Laboratories guideline that ensures that shipped meat is free from diseases such as Salmonella nad E-Coli and conform to international animal health requirement. The butchers are trained for standard bovine cuts as a labeling information on cartons (date of manufacture, specification of the cuts, shelf life, Halal, etc) must be printed. Application for the registration of an abattoir must be submitted at APEDA as it is an authorized body to issue Plant Registration Certificate. It issues the certificate after following a stringent check-up. Further Prospects & USDA Viewpoint India''s buffalo meat exports are expected to be higher by 25 per cent at 1.52 million tonnes in 2012 due to consistent demand from Vietnam, Southeast Asia, the Middle East and Africa, according to the USDA report. Given explosive export growth, India is likely to become world’s largest beef (buffalo meat) exporter by 2013, according to USDA study. "Indian beef (buffalo meat) exports for 2012 are now estimated at 1.52 million tonnes, up by 25 per cent over last year," the US Department of Agriculture said in its report. In 2011, beef exports rose by 33 per cent to 1.22 million tonnes over the previous year. The USDA said the export growth would be largely due to consistent demand from price sensitive importers and increase in slaughter capacity by


Meat Industry 2012-end. As per the USDA estimate, Indian beef meat production is expected to be 3.50 million tonnes carcass weight equivalent (cwe), as against 3.17 million tonnes in 2011, whereas, domestic consumption is expected to drop marginally to 1.98 million tonnes due to profitable exports. "Increases in beef production estimates are attributed to several factors, including increased slaughter, Indian buffalo meat’s cost competitiveness in the export market, and increasing animal inventories as Indian milk production expands," it said. The report highlighted that there were three new export- oriented slaughter units created in 2011, bringing the total number to 33. Quoting industry sources, the report said that 12 additional export-oriented slaughter and processing facilities will be built by the end of 2012. However, it is important to note that while exporters remain optimistic, they do not expect either new or existing slaughter facilities to produce at full capacity, primarily due to operational inefficiencies and demand limitations, the report noted. Since supply chains for domestic and exported buffalo meat are separate in India, the USDA said buffalo meat

The Halal certificates are issued by the representatives of Jamiat-e-Ulema-eHind as they must remain present at the time of slaughter. Apart from this, the animal and carcasses must be subjected to ante-mortem and post-mortem inspections by qualified veterinarian of the Central Government Agency production growth is being led by the export market, while domestic demand is keeping pace with population growth. Further expansion into the domestic market appears unlikely as that Indian meat retailing lacks cold chain facilities. Also, Indian consumers prefer nonbovine proteins such as chicken, goat and

dairy products, it said. Current estimates indicate that there are approximately 95 million buffaloes in India and this population is probably expanding as milk production is on the rise, it added. Strides in Poultry & Livestock India ranks first in having the largest livestock population in the world. Livestock plays an important role in the national economy and in the socio economic development by augmenting family incomes and generating gainful employment in the rural areas, particularly for the landless, small and marginal farmers and women. With its 1.2 billion population and 9 per cent GDP growth rate, India is rapidly emerging as one of the biggest markets in the world. Livestock sector contributes approximately 4 per cent to GDP and 27 per cent to agriculture GDP. Poultry and dairy sectors are the major sectors contributing to economic development. The poultry sector has undergone a paradigm shift in structure and operation during the last two decades. It has transformed itself from a mere backyard activity into a major commercial activity with

Indian poultry giants enter Bangladesh

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ver the last two years three of India’s poultry giants, Venkateshwara Hatcheries Group, Shuguna and Amrit, have expanded their operations to Bangladesh. The attraction was the growth in the local industry and the prospects of increased demand for protein due to the rise in incomes and a large population. Suguna Foods, India's number one broiler producer and a pioneer in poultry integration, has leased a number of parent stock farms to breed chicks to market among farmers. They have also rented a feed mill. India's poultry conglomerate Venkateshwara Hatcheries (VH) Group, also known as Venky's, has set up a feed mill, Uttara Food and Feeds Ltd, to grab a part of 2,500,000 tonnes of

annual market for feed in poultry and fish farms. They also have plans to set up a grand parent stock farm in Sylhet. The arrival of foreign companies has created worries among the local poultry and feed industry operators who fear uneven competition as foreign companies get funds at lower costs. Moshiur Rahman, convener of Bangladesh Poultry Industries Coordination Committee, said the government should not allow foreign investment in these sectors where local investors have developed capacity. Ihtesham Shahjahan, general secretary of Feed Industries Association of Bangladesh, said foreign companies enter Bangladesh market because of competitive advantage in terms of loans that they get at lower interest rate from abroad. He said the production capacity by Bangladeshi companies far exceeds the

present annual demand for 2,700,0003,000,000 tonnes of feed. "So, why do we invite outsiders with a huge competitive advantage," he said, urging the government to make a list of possible investment areas where local companies are yet to venture or bring in new technology. It should be done in consultation with the local industries, he said.

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Meat Industry

Meat has a huge effect on human evolution: Scientists

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eat eating helped early humans to spread more quickly across the world and had a profound effect on human evolution, says a research study. Researchers from Lund University in Sweden found that the high-quality diet allowed mothers to wean babies earlier and have more children, allowing human communities to grow faster.

The researchers, who detailed their findings in the scientific journal PLoS ONE, compared 67 species of mammals, including humans, apes, mice and killer whales, and found a clear correlation between eating meat and earlier weaning. They also found that babies of all species stop suckling when their brains have developed to a particular stage, but carnivores reached this point more quickly than herbivores or omnivores. "Eating meat enabled the breastfeeding periods, and thereby the time between births, to be shortened," lead author Elia Psouni said. "This must have had a crucial impact on human evolution." In the past, researchers had tried to explain the shorter breast-feeding period of humans based on social and behavioural theories of parenting and family size.

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participation by big players as also successful implementation of contract poultry farming on a large scale. India is emerging as the world's 2nd largest poultry market with an annual growth of more than 14 per cent, producing 61 million tonnes or 3.6 percent of global egg production. The broiler industry is well dominated by southern states with nearly 60-70 per cent total output coming from these states. The layer industry is also dominated by these states, especially Andhra Pradesh, Tamil Nadu and Maharashtra producing nearly 70 per cent of the country's egg production. India's 75 per cent of egg produce is consumed by the 25 per cent population living in urban and semi-urban areas. Presently about 800 hatcheries are operating in the country. The annual growth rate of egg production is 5-8 per cent. Apart from this, India ranks 6th in broiler production (125 billion Rupees) with an annual output of 2.39 million tonnes of broiler meat, as per the estimates of the Ministry of Agriculture, Govt. of India. The total poultry industry is valued at about 350 billion rupees. The per capita consumption per year is approx 2.4 kg, which is much lower than the National Institute of Nutrition's recommended 11 kg. Several key factors are driving the recent growth of the Indian poultry sector. First, consumer demand for poultry is rising, driven by both income growth and changes in prices of poultry meat relative to other goods. Second, the structure of India’s poultry market is changing. In particular, vertical integration of poultry production and marketing has lowered costs of production, marketing margins, and consumer prices of poultry meat. The future pace of vertical integration in the industry is likely to affect the pace at which consumers shift from a preference for live birds to a processed (chilled or frozen) products, a shift that will enable poultry integrators to expand their market reach and scale of operations. Finally, feed availability and prices have a central role in determining costs of production and consumer prices. Addressing this factor entails assessing the potential for competitive

AgriBusiness & Food Industry w June 2012

domestic production of feeds, the impact of other sources of domestic demand for feeds, and policies affecting trade in feed ingredients. Livestock development The Union Agriculture Ministry's Department of Animal Husbandry, Dairying & Fisheries is focusing on increasing the animal population and productivity as a thrust area, offering financial assistance to the organizations. This will boost not only milk but meat production as well. On the other hand, Ministry of Food Processing Industries has its own programs to increase processing and value added products to target export markets. This would facilitate India to achieve its potential of becoming a “Food Factory of the World”. Besides the Ministry of Agriculture and the Ministry of Food Processing Industries, the list of organizations playing a major role in the development of poultry and livestock industry is quite long. Prominent among them are: APEDA, National Meat & Poultry Processing Board (NMPPB), Poultry Federation of India (PFD), National Dairy Research Institute (NDRI), Progressive Dairy Farmers Association, National Dairy Development Board (NDDB), All India Poultry Breeders Association (AIPMA), Karnal Poultry Farmers Associations, Central Institute of Fisheries Technology, Kerala Livestock Development Board, National Egg Coordination Committee (NECC), Compound Livestock Feed Manufacturers Association (CLFMA), National Institute of Nutrition (NIN) India Poultry Journalists' Association (IPJA), Andhra Pradesh Poultry Federation (APPF) and Poultry Breeders Association (A.P.) Undoubtedly, India's has big potential to increase consumption of meat and meat products in domestic and International markets. However, there are some constraints hampering growth, and they include lack of advanced technology, inadequate cold storage facilities and processing equipment, particularly at the farm level. What is needed is a strong platform for all stakeholders to share knowledge and technology. This is what “Poultry & Livestock Expo 2012” seeks to achieve. www.IPLexpo.com


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Meat Industry

To focus on advanced technology for Indian Meat Industry

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ne of the greatest challenges facing mankind is to satisfy the food needs of the fast growing global population, while at the same time to conserve land, water and biodiversity resources. Livestock are a crucial element in this balancing process. Demand for livestock products is growing fast, especially in the developing world. Livestock, through their multiple functions, are a cornerstone of the livelihood of most of the rural population in the developing world. On the other hand, livestock use around 60 percent of the world's land area, including one fifth of the world's crop lands, and therefore interact directly and indirectly with a large part of the world's natural resources. Positioning livestock in such a way that it can satisfy future demands, while preserving the natural resource base, is therefore a critical element of sustainable agricultural development. Indian Meat Industry is yet to flourish, even though India is home to one of the highest population of cattle and animals. India ranks first in the world for buffalo population and one sixth in the world for goat population. The production of buffalo meat in India alone is above 1.5 million tonnes annually and accounts for about 30 per cent of total meat production. The contribution to the production by cattle, sheep, goats and poultry is 30 per cent, 5 per cent, 10 per cent, 10.2 per cent and 11.5 per cent, respectively. The increase in per capita income and urbanization are fuelling the demand for meat and meat products. While the population is expected to double in Asia and Africa by the year 2020, the demand for meat and meat products is expected to triple. Per capita meat consumption in India is relatively low at less than 5 Kg/ year as compared to other developing countries such as Pakistan (13.7 Kg),

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China (38.6 Kg) and Brazil (58.6 Kg). Based on the minimum requirement of 20g animal protein per capita per day sourced from milk (10 g), meat (4 g), fish (4 g), and eggs (2 g), the estimated demand for meat is 7.7 million tonnes as against the present production of 4.6 million tonnes. Burgeoning global market opportunities for the Indian meat sector have significantly spawned a plenty of private investment in meat processing through state-of-the-art technology of integrated plants. But unfortunately such sophisticated and advanced meat processing units are less in number and such products are meant for exports which have been growing at close to 30 percent annually in terms of quantity, which is widely obtained from poultry, buffalo, sheep and goat meat. However exports in value terms are not much. The growing demand for meat and meat related products has brought about significant advancement in technology and induced phenomenal invention of machinery and equipment in India. Focusing on operational and technological mechanism, encompassing Cutting, Mixing, Seasoning, Smoking, and Curing, appropriate and up to date techniques are required. If there is no hygiene in place and up to date technology, meat processing business will never grow. For the purpose of consumer protection and quality control, stringent hygiene measure is something indispensable. Besides, we are also facing of huge magnitude like unhygienic production of meat, contamination, poor infrastructure of abattoirs, unscientific processing, absence of cold chain, poor packaging and near absence of meat safety management systems. Poultry meat exports are negligible due to high costs, inadequate meat processing facilities and infrastructure bottlenecks. The demand is for safe and wholesome meat. Much research has been conducted for advancement

AgriBusiness & Food Industry w June 2012

of technology for keeping the meat products safe and hygienic, for that reason correct treatment is also very important for maintaining the quality, shelf life, and natural flavor of the final products. There is an urgent need to frame a right strategy for the development of meat and poultry production in the country. This will certainly bring prosperity to millions of our rural citizens and create employment in rural India. The potential for rapid growth is high, particularly if a specific time bound plan of action is drawn up jointly by various wings of the government and the meat export industry. If the meat industry is well organized and integrated on scientific lines, more employment would be generated in rearing of animals and processing of meat and meat made products for the industry. It is for this purpose that we have conceived this specialized conference with the theme of meat processing technologies and focusing on addressing challenges, research direction, technological gaps and constraints and developing delivery mechanism for developments and advancements in the field of meat processing, involving different scientific disciplines. The Conference aims to bring together academic scientists, leading engineers, industry researchers and scholar students to exchange and share their experiences and research results about all aspects of meat processing, and discuss the practical challenges encountered and the solutions adopted. The Conference further aims at formulating follow - up actions and identifying pilot activities to test innovative approaches. Hence, it is a unique opportunity for exchange of scientific knowledge and planning of joint research and other co-operative actions. Confederation of Indian Industries (CII) is organizing a seminar, Meat Tech 2012 : Meat Processing Technologies, on June 8, in Chennai.


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Agri Affairs

38th Special Session of CFS Reflecting India’s leadership in farming sector — Sanjeev Chopra

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attended the Thirty Eighth Special Session of the Committee on World Food Security (CFS) at the FAO headquarters in Rome on 11th May, as the head of the Indian delegation. The final position paper adopted by the Conference reflects India’s leadership in the agriculture sector, especially in production systems dominated by marginal and small landholder farmers. The consensus statement adopted by the CFS shows how advanced the Indian political system has been on conferring tenure rights to the tiller –for these are concerns which are being raised today by many countries, and India resolved these issues immediately after Independence. The key theme of the conference was the adoption of Voluntary Guidelines by (FAO) member countries to serve as the reference point and to provide guidance to improve the governance of tenure of land, fisheries and forests to those whose livelihoods are critically dependent on these sectors. These Voluntary Guidelines (VGs) are intended to contribute to the global and national efforts towards the eradication of hunger and poverty, and are based on the premise that secure tenure rights of those who are actually engaged in the process of food production would lead to greater sustainability of food production. India’s example of securing land rights to tenant farmers, and access to credit even for oral

22

lessees was held out as an exemplar of how countries, legislatures and central banking institutions can improve the productive capacities of those engaged in food production. India’s grant of land rights to forest dwellers also came in for acknowledgment and appreciation. However one must confess that while we have conferred legal rights, and also created enabling legislation for consolidation of land holdings, there is much scope to improve the functioning on the ground. While it is true that several districts have shown good work on computerizing land records, transactions on land especially ‘land leases’ and mutations can be simplified, and linked to credit and technical support services. Like all UN documents, there is much that is sheer verbose, yet has to be included. Thus after the brief Preamble (part I) in which the Objectives, and the nature and scope of the guidelines are covered, Part II and III of the report speak of General Matters and Guiding Principles : human dignity, non-discrimination, equity and justice, gender equality, realistic and sustainable

AgriBusiness & Food Industry w June 2012

approach, consultation and participation, rule of law, transparency, accountability and continuous improvement. Sometimes, one fails to understand why all these ten points could not be covered under the broad head of human dignity, and perhaps continuous improvement, for everything else can be covered in these two broad categories. One was told that several points have to be included for the UN system is now trying to reach out to the civil society, NGO sector, business community and engaged in broad consultation with all stakeholders, who wish to include all the pious intentions into every document that is published by any of the UN agencies. Part IV of the document is on Rights and Responsibilities relating to tenure. This part has also drawn from the policy debates in India with regard to inclusion of women’s name in the record of rights, both as owner-cultivator and as a tenant so that arbitrary evictions do not take place on the demise of/divorce from husband. In fact the Voluntary Guidelines read so much like a joint working paper of the Krishi Bhawan and Planning Commission with inputs from the Ministry of Environments and Forests. There was a discussion on how land acquisition policies should recognize the rights of all those who dwell and draw sustenance from the land. The Joint Forest Management and Van Panchayats which have a legal status in our country are sought to be universalized : “ states should welcome and facilitate the participation of users of land, fisheries and forests in order to be fully involved in a participatory process of tenure governance, inter alia, formulation and implantation of policy and law and decisions on territorial development , as appropriate to the roles of the State and non –state actors, and in line with


Agri Affairs National law and legislation”. Part V of the document is on Policy, legal and organizational frameworks related to tenure. The key statement here is that land tenure rights are part of the overall policy framework and constitution. Thus 5.9 reads: “states should recognize that policies and laws on tenure rights operate in the broader political, legal, social, cultural, religious, economic and environmental contexts. Where broader contexts change, and where reforms to tenure are therefore required, states should seek to develop (national) consensus on the proposed reforms”. The next section (part VI) is on Delivery of services - because unless states have a clearly defined implementation procedure and schedule, all the statements referred above have no meaning. Here the Right to Service Act which has been introduced in several states of India, with Bihar, Punjab and Karnataka taking the lead can be a good global exemplar.

India’s example of securing land rights to tenant farmers, and access to credit even for oral lessees was held out as an exemplar of how countries, legislatures and central banking institutions can improve the productive capacities of those engaged in food production. India’s grant of land rights to forest dwellers also came in for acknowledgment and appreciation Last but not the least, was the reference to the rights of Indigenous people on lands which traditionally belonged to them. Here Canada, US and Australia made their statements of pious

intentions, but the main thrust was that all the recommendations were not legally binding –because this issue has very serious implications for them because not only have indigenous peoples land been alienated, their way of agriculture has been completely lost –so much so that even if they wanted to, it would not be possible for them to undertake the venture again. In fine, it was clear that India’s position on land tenure rights, rural development programmes, capitalization of agriculture and the thrust on co-operatives and farmer producer companies to achieve economies of scale and scope are well respected globally, and that it was time for India to share its knowledge and expertise with the world. (The author is Joint Secretary & Mission Director, NHM & NMMI, Union Ministry of Agriculture)

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Cover Feature

Trade Exhibitions Rocketing Agri m s i r u o T & s Expor t m is r u o t e d a r t y a w o w t Expos — a boost to

– S Jafar Naqvi & TV Satyanarayanan

A

n offshoot of the fascinating saga of India’s transition from agriCulture to agriBusiness is the proliferation of mega expos to showcase the latest achievements in agriculture and allied activities. This, in fact, is in keeping with the global trend of organizing big international exhibitions to bring together all stakeholders on a single platform. These mega events, undoubtedly, offer a win-win situation for all. They promote trade relations between countries, technology transfer and joint ventures, and what have you — in fact the whole host of cooperative activities and arrangements, the scope of which has been widening in the current pattern of world trade. Although WTO negotiations are not making much headway, free trade agreements among countries are becoming the order of the day. Unobtrusively, the increasing number of international expos and exhibitions has yielded another important spin off – promotion of agri trade tourism. In India, the transformation in agriculture being showcased through expos is becoming the

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AgriBusiness & Food Industry w June 2012

In the forefront of Indian participation in overseas shows is Agricultural & Processed Food Products Export Development Authority (APEDA) under the Ministry of Commerce, along with organisations like Tea Board, Spices Board, Cashew Board, MPEDA, Coffee Board, IOPEPC and AIREA


Cover Feature focus point for drawing delegations and trade visitors, thereby adding value to Indian agriculture, food processing and other employment-generation activities. Among India’s major events in agri and food sector are: Annapurna World of Food, Food Tech, India Foodex, FI India, Food Pro, Aahar, DairyTech India, Horti Expo, Flora Expo, Poultry India, Poultry &Livestock Expo. Agri Tech India, Grain Tech India, Kisan, EIMA, AgriMech etc. To cite an example of foreign participation, take the case of the popular expo series held in Bangalore – Agri Tech India, Grain Tech India, Dairy Tech India and India Foodex, all held under one roof. A total of 35 to 45 per cent of the space there was occupied last time by overseas exhibitors, directly or through their Indian representatives who came from Holland, Turkey, Italy, Thailand, USA, Germany, Israel, France, China, Taiwan etc. This is proof of increasing recognition that other countries are according to India’s growth in agribusiness. Foreign companies see possibilities of exporting their technology, expertise and machinery to India, opening up further cooperation in creation of employment opportunities for skilled and semi-skilled manpower. Recent developments and investments in poultry, livestock, dairy, rice milling, seed sector, storage and value addition chain in horticulture crops, specially in western, central and southern India, would give a broad picture of foreign projects in operation in the country through tie-ups with Indian companies and joint ventures. Upcoming Food Parks and the Special Economic Zone like IFFCO Kisan SEZ in Andhra Pradesh are instances where foreign investments and technological innovations are quite visible. In recent past Holland has been a partner country in organizing Horti Expo and Flora Expo series. With so many Indo-Dutch companies participating, one section of the show held in March this year virtually looked a mini Holland. The Netherlands ambassador to India Mr. Bob Hiensch pointed out that Holland is already cooperating with agencies like National Horticulture Mission and National Horticulture Board. He described this year’s expo as a fine example of Indo-Dutch cooperation. As Mr.Henk van Duijn, Agriculture

Clearly, India is emerging as a major destination for exhibitors and trade visitors from abroad, most of whom come from Europe, South East Asia and Gulf region Counselor of the Netherlands embassy, put it, “India is one of our important partners . . . Our strategy is to invest in India in local production facilities and enhance local capabilities through technology transfer. We believe we have to be in India to integrate the total IndoDutch trade chain.” What interests foreign investors in Indian agribusiness is an awareness of this country’s big potential to become a ‘Food Basket of the World’. To cite some facts and figures, to buttress their perception: Indian food processing industry, recognized as a “sunrise industry,” is growing at a rate of 14.9 per cent per annum, and it is expected to grow much faster very soon. The segments that hold much promise include dairy, fruits and vegetables processing, grain processing, meat and poultry processing and fisheries. India already ranks as the world’s largest producer of fruits and second largest producer of vegetables. In poultry production, India ranks fifth in the world. Alongside the Indian food and beverages market has been expanding rapidly. The country already stands on the top rung of the ladder in global milk output. To meet the estimated demand of 200-210 million tonnes of milk by 2021-22, NDDB has drawn up a Rs. 17,300 crore National Dairy Plan. Recently the government launched the 1st phase of the plan with an outlay of Rs 2242 crore. Funded by International Development Association and Government of India, the plan recommends a two-prolonged strategy. First, doubling of the milk production over a period of 15 years by improvement of milch animals and optimal use of feed and fodder in order to fully realize the improved genetic potential, and secondly, increasing the share of marketable surplus of the organized sector, both cooperative

and private dairies from 30 to 65 per cent. Foreign companies manufacturing farm machinery and equipment also view India as a potential market, since interest in farm mechanization has escalated in this country of late, because of labour shortage during busy seasons. Noticeably, one of the popular spots for farmers from states flocking various agri fairs in this country is the section devoted to display and demonstration of farm machinery for both small and big holdings. They seek details of maintenance aspect, availability of spare parts and cost of various farm machinery exhibitors to understand the viability of their adoption to local conditions. All these developments reflect the emergence of India as a major destination for exhibitors and trade visitors from abroad, most of whom come from Europe, South East Asia and Gulf region. Interestingly, major event organizers like Koelnmesse, UBM, Reed Group, Informa, Hanover Fair, Messe Berlin, Messe Frankfurt, Diversified Group, Victam, All World Exhibitions and the like have opened their offices in India to mobilize participation of Indian companies and trade visitors in their own shows abroad. A few MNC’s are also organizing shows in India in food segments successfully. Major

AgriBusiness & Food Industry w June 2012

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Cover Feature trade promotion bodies working under their respective embassies or consulates in India, like Indo German Chamber of Commerce and Italian Trade Commission, UBI France, VDMA are ardently working to ensure Indian trade participation in their shows. For Indian companies, participation in overseas shows acts as a major growth driver for boosting their exports, particularly to all important food importing destinations. In the forefront of this effort is Agricultural & Processed Food Products Export Development Authority (APEDA) under the Ministry of Commerce, along with organisations like Tea Board, Spices Board, Cashew Board, MPEDA, Coffee Board, IOPEPC and AIREA etc. “APEDA regularly participates in about 20 major agriculture and food events across the world. The growing success of Indian participation can be gauged from the fact that the number of exhibitors crossed the mark of 150-200 this time in major food expos like Anuga Germany, Sial in Paris and Gulf Food in Dubai. This time, in Germany’s Bio Fach, the world’s largest annual organic event, India was the ‘Country of the Year’, said Mr. Tarun Bajaj, GM APEDA. All these expos have helped to achieve new milestones, not only by promoting Indian food products and cuisines, but also by spreading Indian culture and art forms. Ceremonial lighting of lamp, vigorous Bhangra dances and applying Tilak (vermilion mark) to VIP’s lend typical Indian flavour to ‘India Evening’ celebrations in these expos. In recent years, travel companies like Orbitz, Cox and Kings, Destination, Uday Travels, Flexi Tours, are offering special packages for Indian trade visitors and encouraging them to visit not only above mega events but also small and specialized trade shows and also technical and field visits. As per trade sources, the number of visitors has been are going up by leaps for the past few years. What is more, in terms of participation in overseas exhibitions, India has become a trend setter for

26

neighbouring countries. Following the Indian model, countries like Pakistan, Nepal and Bangladesh are sending more delegations and trade visitors to participate in various expos. All this is what must be termed as Agri trade tourism, a benefit accruing from India’s march from agriCulture to agriBusiness. Tourism industry in India, SAARC and other countries are a gainer in this process. While the advantages flowing to the economy by holding professional trade exhibitions are many, it would be worthwhile to consider some steps that need to be taken to further promote India’s strength as an exhibition destination. The Indian exhibition industry at present faces some constraints in organizing events, and they include lack of adequate professional venues, policy ambiguities, red tapism and an unsupportive tax regime. While each state capital by itself has the potential to hold professional exhibitions for development of that state, the unfortunate part is that only a few have exhibition centres. A city as large as the national capital in fact needs at least five centres of the magnitude of Pragati Maidan to cater to the requirements of potential exhibitors, whereas the only one that exists now is woefully short of facilities and is extremely expensive. The other venues located nearby are poorly connected. While globally an organizer spends 10-20 per cent of revenue on booking a venue for exhibition, the expenditure incurred in India for this purpose is 40-60 per cent. Organizers end up spending a fortune just to create temporary structures that are easily available for their counterparts in most developed nations. Surprisingly, despite the growing demand from this industry, the government is yet to create proper infrastructure in major towns. Policy ambiguity is another issue. The main controlling body for trade exhibitions is itself an event organizer. Then, there are permissions and permissions that are needed. From police department, traffic department, entertainment tax department, sales tax department, municipal corporations, fire department, and so on. Exhibition organizers spend considerable time chasing

AgriBusiness & Food Industry w June 2012

these authorities to get permission. To simplify matters, why not make ITPO itself a single window clearing authority for professional trade exhibitions? Alternatively, Government should recognize Indian Exhibition Industry Association (IEIA) as a nodal agency to facilitate all clearances and approvals. For foreign participants to exhibitions held in India, getting visas is a major hassle. Whereas organizers in Europe issue invitation letters that are honoured by their embassies in India, the same is not true for Indian organizers. In one case, an organizer who invited visitors to his exhibition in Delhi was shocked to know that all of them coming from neighbouring nations were issued visas as his 'personal guests' and not as tourists! The government of India should make clear guidelines for 'professional trade tourism'. A major stumbling block for development of the exhibition sector is the tax regime. Tax authorities tend to treat professional trade exhibitions as purely entertainment shows, which they are not. Professional trade exhibitions help to spread awareness and education, create infrastructure and promote trade and tourism. Each of these activities, if done separately, would qualify for subsidy from government. But an initiative that is virtually a combination of all these activities gets heavily taxed! For instance, Government provides support to educational institutions to teach how to grow flowers and vegetables in greenhouse. An exhibition like Flora Expo practically does the same –displaying the entire process of flower cultivation right from planting material, greenhouses and polyhouses to post harvest technology. Moreover, trade visitors come from around the world to buy the flowers. Still, this activity – organization of expos -- which in every sense is educational & promotional, is taxed heavily! The authorities should create separate tax structure for 'Professional Trade Exhibitions', keeping in view the benefits accruing to the government exchequer from these exhibitions. Because of the multiple advantages that professional exhibitions provide for the growth of various sectors of the national economy, they definitely deserve more incentives to move forward with greater vigour. n


AgriBusiness & Food Industry w June 2012

27


Interview

Holland partners with the most relevant & high potential exhibitions

Henk van Duijn, Counsellor for Agriculture & Food Quality at the Embassy of the Netherlands in New Delhi, is responsible for active trade promotion and business development. He has been instrumental in strengthening Indo-Dutch relationship in the field of agri business & trade. With wide experience in the field, he is well equipped to give his opinion and judgment on the role of exhibitions in boosting trade and agri-tourism. In an interview to Syed Jafar Naqvi, Editor, he elaborated his views. Excerpts:

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AgriBusiness & Food Industry w June 2012


Interview Being the Agriculture Counsellor, responsible for agri trade development cooperation between India and Holland, please tell us about the growth in the last few years.

Agriculture commodity trade between India and Holland and vice versa is picking up. In the next 5-10 years agriculture commodity trade between the two countries will rocket to a billion dollar business. The Dutch trade development approach is three fold, stimulating Dutch investments in local agriculture and food processing, securing our sourcing of agriculture commodities out of India and last, but not the least, promoting Dutch food products exports to the Indian market. Food security is an important pillar in the Indian 12th Five Year Plan. A major number of Dutch agribusiness is already active, or participating in food production, storage or processing in India. The activities include introducing new seed varieties, germ plasm, farm and feed management, poly tech greenhouse cultivation, biological pest management, storage and processing technologies and modern retail, boosting local production of vegetables, potatoes, flowers, dairy, poultry, fruits and processed food products. In close cooperation with the relevant Ministry, APEDA and MPEDA and different associations and private Indian exporters, Dutch traders are involved in expanding existing markets in Europe as well developing new markets for Indian products abroad. On the other hand, we see an increase in demand in India for imported food products, like apples

and pears, meat & dairy products and other food products. As the 2nd largest agriculture exporter in the world, the Netherlands knows the best how to combine demand of consumers and supply of produces from all around the world. We do not want to say no to an Indian consumer who demands 365 days a year fresh strawberry in his retail outlet or the mandi. It is a challenge for the Indian and the Dutch side, but we are convinced that with joint efforts in further upgrading production in India and further liberalizing bilateral trade, these challenges will be great opportunities.

How do the exhibitions and events fit in your objectives of Indo-Dutch promotion?

create a national or regional network event for buyers and sellers of the newest technology for the local market as well for exports and imports of goods.

How many exhibitions does your department participate in India annually?

The aim is to support and assist 1 or 2 professional exhibitions on a national or regional scale in the bilaterally relevant agriculture sector in India. The Netherlands is a partner country in 10-12 exhibitions per year in the areas of floriculture, horticulture, fresh produce (fruit & vegetables), dairy, animal husbandry, cold chain and food & grocery.

To strengthen the Dutch presence in the mentioned three areas of our bilateral trade relation, the Dutch companies, traders, investors, research and educational institutes would like to interact with the progressive and professional growers, traders, processors, retailers, investors and officials in the areas of green genetics, horticulture, food processing, cold chain and logistics, dairy and animal husbandry. At the moment a large range of national, state and local exhibitions try to create such a network and B2B platform, competing which each other in time, participants and crowd. Holland partners with the most relevant and high potential national and regional exhibitions. The Netherlands is partner country of these exhibition with a dual perspective – it is in the interest of everybody that the exhibition becomes more professional and extracts more professional crowds – the more international players are supporting the event the bigger the impact will be of the exhibition, and in the end, it will

Can you elaborate on the constraints in India in comparison with China, which is more organized in using exhibition industry successfully word over to promote their trade?

Exhibitions in India are often competing with each other in time, participants and audience. Most exhibitions in agriculture are not yet always the stage for the important corporates, private investors, growers, traders, retailers and visitors like the Hortifair in the Netherlands, the Anuga in Germany, Gulf Food in Dubai or the Fresh Produce Asia in Hong Kong. Most agriculture and food processing related fairs and exhibitions in China developed towards this network and adopted B2B interaction event-driven approach in the last ten years. But professionalism is rapidly improving and the numbers of high profile national or regional exhibitions are increasing, which helps to promote new technologies in the Indian market and Indo-International trade. That’s why Holland is partner country of the best exhibition in the country. n

4th International Event on Food & Beverage Products, Processing & Packaging Machinery and Allied Industries

www.indiafoodex.com Tel.:+91-11-26681671 / 2045

25-26-27, August 2012 Gayathri Vihar, Palace Ground, Bangalore AgriBusiness & Food Industry w June 2012

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Interview

Participation has to be impressive and qualitative

Tarun Bajaj is the General Manager of Agricultural & Processed Food Products Export Development Authority (APEDA) under the Ministry of Commerce & Industry, Govt. of India. APEDA, responsible for the promotion of exports of Indian agricultural and food products, is a regular participant of several high-profile global exhibitions. Bajaj spoke to Anwar Huda to share his views with the readers of this magazine on the role of exhibitions to boost export and agri-tourism and achieve high product quality. Excerpts: Being the GM of APEDA, responsible for overall trade promotion through exhibitions, please tell us about your department and the growth in last few years.

Exports of APEDA scheduled products have consistently grown over the period. Now, we are expected to cross Rs. 60,000 crore. Participation in the trade fairs is one of the tools being used to promote Indian products internationally.

How do the exhibitions and events fit in your objectives of export promotion?

The objective of APEDA is export promotion of scheduled products and participation in exhibitions is an important tool to meet this objective. It helps basically in two ways -- one, promotion of the products, second, B2B interactions. Market promotion helps in promoting in general the product in the identified market. The target groups are consumers, buyers, wholesalers and policy makers. It helps in promoting the

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Indian Officers and Participants at ANUGA 2011

country as a consistent supplier of good quality produce at reasonable price. B2B interactions facilitate negotiations and these negotiations covert into business, sometimes instantly, sometimes gradually.

AgriBusiness & Food Industry w June 2012

In how many Exhibitions does APEDA participate in India and overseas annually?

APEDA participates in around 20 international exhibitions annually, in US, Canada, EU, Middle East, Africa,


Interview

Far East and SAARC Countries.

What has been the impact of exhibitions on Indian products exports scenario?

Our chart (see figure) will tell you the exports have increased consistently and, we hope to achieve greater success in near future. The role of exhibitions is immense for all these achievements.

Can you elaborate the positives and negatives, if any, in national and international exhibitions?

The positives of participation in national and international exhibitions are, as already mentioned, they help in promotion and business development. The negatives are as follows: l In case an exhibition is not marketed properly by the organisers, the participation can be waste of time and resources. l One has to participate in the right exhibition to meet the targeted customer / buyer. In case the selection of the

Tarun Bajaj (C) with Afzal Aziz and Afzal Latif of Allanasons Ltd. at ANUGA 2011

exhibition is not proper, the result would be negative. l If the participation quality is not up to the mark, the impression could be negative instead of being positive. Therefore, the participation has to be

impressive and qualitative. Besides, general principles of dos and don’ts of general market also apply in case of promotion of products through exhibition.

COMPARATIVE STATEMENT FOR EXPORT OF AGRI AND PROCESSED FOOD PRODUCTS April - December 2011 VIS-A-VIS PREVIOUS YEAR

PRODUCTS

April - December 2010 Unit value QTY in MTs

VALUE (In Rs. Lakhs Rs. Lakhs USD Million Per Tonnes)

April - December 2011 Unit value QTY in MTs

% Change

VALUE (In Rs. Lakhs Rs. Lakhs USD Million Per Tonnes)

Rs. USD

SCHEDULE PRODUCTS A. Floriculture 21497.13 B. Fruit & Vegetable Seeds 6852.47 Floriculture & Seeds

46.73 26313.07 12863.39 27.96 1.88 44010.22 34360.52 74.70

55.28 17993.84 37.80 0.41 44306.91 93.08

22.40 39.88 28.95

18.29 35.18 24.61

A. Fresh Fruits B. Fresh Vegetables Fruits & Vegetables

149954.51 199109.84 349064.35

156710.62 227269.77 383980.39

329.22 477.46 806.68

4.51 14.14 10.00

0.99 10.31 6.31

185.80 1.69 250.50 163.56 599.87

32.30 58.03 41.04 44.58

27.85 52.72 36.30 39.72

325.99 432.85 758.84

A. Pulses 167289.00 66847.30 B. Processed Fruits & Juices 75451.57 C. Processed Vegetables 55200.43 Processed Fruits &Vegetable 197499.30

145.32 2.50 52430.00 88439.96 164.03 119239.70 120.00 77856.27 429.35 285535.93

A. Dairy Products B. Poultry Product C. Meat And Its Products Livestock Products

117.90 46.80 1366.14 1530.84

39670.42 83.34 25766.87 54.13 988562.10 2076.81 1053999.39 2214.28

-26.85 19.68 57.31 49.68

-29.31 15.66 52.02 44.65

A. Groundnuts 288143.00 142048.10 B. Guargum 274447.00 177115.14 C. Spirit And Beverages 57618.91 D. Misc. Processed Items 181715.51 Other Processed Foods 558497.66

308.80 0.49 521396.00 385.03 0.65 503754.00 125.26 395.03 1214.13

381187.38 800.81 0.73 816193.72 1714.69 1.62 99018.83 208.02 266958.63 560.84 1563358.56 3284.37

168.35 360.83 71.85 46.91 179.92

159.33 345.34 66.07 41.97 170.51

A Basmati Rice 1586172.00 B. Non-Basmati Rice 81964.00 C. Wheat 323.00 D. Other Cereals 1866392.00 Cereals

759851.89 18584.85 56.74 203375.33 981868.81

1651.85 0.48 1759940.00 1127142.57 2367.95 0.64 40.40 0.23 1801535.00 435400.38 914.71 0.24 0.12 0.18 479611.00 67866.02 142.58 0.14 442.12 0.11 2399466.00 376965.97 791.95 0.16 2134.50 2007374.94 4217.17

TOTAL

2825476.41 6142.34

54232.04 21529.42 628424.31 704185.77

5338556.12 11215.45

48.34 43.35 2242.77 2164.02 119508.78 115488.31 85.35 79.12 104.44 97.57 88.94

82.59

* SOURCE : FIGURES BASED ON DGCIS April - December2011 for Principal Commodities(Table 8) April - December2010: US$=Rs. 46.05 April - December2011: US$=Rs. 47.63

AgriBusiness & Food Industry w June 2012

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Interview

Challenge lies in getting right mix of

exhibitors & trade visitors Sumit Saran is a Director of The SCS Group, an agribusiness consulting firm specializing in marketing, international trade and communications strategy related to food, beverage and agricultural products. The firm has an intimate understanding of the Indian consumer’s evolving tastes and purchasing patterns of premium foods against the background of rising disposable incomes and globalization of the economy. The SCS Group has been a pioneer in nutrition-based food marketing in the country. The company works with private firms, commodity groups and government agencies to create a market for high value food products in India. The firm represents Fresh California Grapes, Washington Apples, USA Pears, USA Apples and California Prunes, among others, in India. His spoke to M.B. Naqvi on the role of exhibitions for trade and agri-tourism promotion. Excerpts: Being a company participating in major trade shows in India on behalf of US bodies and also responsible for managing Indian pavilions in overseas exhibitions, tell us about your company’s growth in last few years…

Our firm, The SCS Group is an agribusiness consulting firm specializing in marketing, international trade and communications strategy. We offer our services relating to food, beverage and agricultural products. Since our work is primarily related to food, my comments here are about trade shows in general and food trade shows in particular.

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We have been participating on behalf of our US and other international clients at many Food Shows across India like AAHAR, Annapoorna etc. We have also managed India pavilions at many global food shows like Fancy Food (New York), Fruit Logistica (Berlin) Anuga (Cologne), Biofach (Nuremberg), Sial (Paris) and Gulf Food (Dubai). Trade Shows play an important role for food businesses in today’s world, where boundaries have shrunk and trade buying patterns are changing rapidly. Global trade shows like Anuga, Sial, Fruit Logistica etc. have become the meeting point for global trade. For example, if you are looking at being a player in the global fruit business, you just have to be present at Fruit Logistica.

AgriBusiness & Food Industry w June 2012

There are just no two ways about it. The same applies to the other shows I have indicatively mentioned. Food trade shows are at a growth stage in India and things are changing very rapidly. New trade shows are being held, new exhibition centers have been constructed, and the market is opening up to foreign investors. We also see more and more foreign exhibitors and visitors in India and we also see more and more Indian exhibitors at global Shows. At a time, when there is a deluge of Shows, it is imperative that India selects the events it wants to participate carefully, and create a presence that Indian agribusinesses deserve. Correct selection and advance planning are the key factors for trade show success.


Interview

How do the exhibitions and events fit in your objectives of Indo-US cooperation?

For our US clients, we work on a model called ROM (Result Oriented Management). The emphasis is on defining a long term strategy for the market, identifying the constraints that are present in the market and designing activities accordingly to meet those constraints. We share our vision and plans with the importers, institutional or food service distributors and the retailers at the start of every season. We get their feedback and then design and implement various promotion strategies. At the end of the season, we go back to the drawing board and evaluate the result of our efforts and make changes if required. Currently, our firm markets various US food products in India including Fresh California Grapes, California Prunes, USA Pears, Washington Apples etc. In about a decade, since India opened its doors for food imports, it has become one of the fastest growing markets for a number of these products. Participation in major food trade shows have been an important component of our outreach strategy.

How many Exhibitions does your company participate in India annually?

In a year, we participate in over 10 trade/consumer exhibitions in India on behalf of our clients. These include AAHAR International Food & Hospitality Show (New Delhi), Annapoorna - World of Food India (Mumbai), Food Hospitality World (Bangalore), Upper Crust Food & Wine Show (Mumbai), Horti Expo (New Delhi) etc. US Department of Agriculture currently endorses two food trade shows in India – AAHAR and Annapoorna and you will see full fledged USA Pavilions at these two events.

Can you elaborate on the constraints in India in comparison to developed world, which is more organized in using exhibition

industry successfully word over to promote their trade.

As I mentioned, in India, the food trade show business it at a nascent stage. Except AAHAR, most other food shows are less than a decade old and hence still trying to find their foothold. A number of food trade shows have just mushroomed without doing enough ground work and are facing serious troubles sustaining themselves. Getting the right mix of exhibitors and trade visitors seem to be the biggest challenge. Many exhibition organizers in India seem to get a number of foreign companies exhibiting but make very little effort to inform and attract Indian trade visitors. Many trade shows in India have tried to be everything to everyone and have completely failed in the process. My personal belief is that it is better to have a small show with targeted visitors rather than have a big Show with non serious crowd. Lack of infrastructure at trade show venues is another very major constraint in India. I sincerely hope that the situation changes in the near future. I see foreign exhibitors struggle for basic amenities (like toilet, water, car park, Internet etc.) Shows after Shows are held but nothing seem to be getting done about it. It is sad to see exhibitors not able to have any proper access to their booths. They suffer at the hands prowling touts right outside India’s flagship trade show venue in the heart of our Nation’s capital. If India has to attract world’s largest trade shows to come and invest here, major changes will need to be done. However, before we start changing the infrastructure, those at the helm of affairs need to change their mindset. We have to remember that the “Exhibitors” are the real stars at the Shows. It is not about the VIP coming to inaugurate the Show, it is about the Exhibitors who are spending their money to exhibit in India. Infrastructure needs to be designed to facilitate their participation. (The views expressed are his personal and do not necessarily reflect those of The SCS Group or any of its clients)

SNAPSHOT OF PAVILIONS CREATED AND MANAGED BY THE SCS GROUP

India Pavilion at Gulf Food, Dubai 2012 Client: APEDA

India Pavilion at Biofach, Nuremburg 2011 Client: APEDA

India Pavilion at Anuga, Cologne, Germany, 2009 Client: APEDA

USA Pavilion at AAHAR 2012 New Delhi, India Client: USDA

AgriBusiness & Food Industry w June 2012

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Interview

Good EXHIBITORS

are country's best brand ambassadors With seven state-of-theart production units and a range of several domestic and international fruit juicebased products, Rasna International has become a popular thirst-quenching and energy-boosting brand in India. The popularity of its products in rural markets is akin to that of any other iconic Indian food product. Its visionary Chairman and Managing Director (CMD) Piruz Khambatta took some time out of his otherwise busy schedule and spoke to Anwar Huda on the role played by trade exhibitions to boost trade and tourism in India and beyond.

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AgriBusiness & Food Industry w June 2012


Interview

As the MD of a top ranking beverage company, what do you think about trade promotion through major exhibitions in India and abroad?

They have an extremely effective role in boosting the trade and tourism. My experience tells that most of the Asian nations have succeeded in increasing their exports due to this phenomenon. Countries like Thailand, Singapore now set up pavilions in the best exhibitions in the world to take their trade to greater heights of growth.

How do the expos and concurrent conferences fit in your objective of expansion, particularly, your export business?

We have a separate budget for these activities as we take this very seriously. And we generally strive to focus on our target market.

In how many exhibitions does your company participate in India and abroad annually?

We take part in five to seven exhibitions, depending on various factors.

What are your suggestions to event organizers in India to improve the overall framework or composition of the exhibitions to successfully promote trade? Would you agree with the view that expos in developed countries are more organized in this regard?

Exhibitions are a very important platform where we should showcase the best of Indian products and packaging, and ensure that Indian stalls have look in keeping with global standards – modern, contemporary, so that, we may project a collective good image not only for our products but our country too. Let us not forget as manufacturers of food products that we are brand ambassadors of the whole nation, as food products touch the heart of the people and can aid in the globalization efforts of the nation.

M B Naqvi, Piruz Khambatta and Girish Jaggi at ANUGA

get motivated to improve their product quality. Through this reputed magazine, I would like to advise unethical copycats, who make false promises to the consumers and ship sub-standard products. Through such efforts they not only do damage to their own name but they also bring a bad name to the whole nation as well. Exhibitors should not encourage counterfeit manufacturers. And they should not be encouraged to manufacture sub-standard products that may also harm the health of the people. In this regard, food magazines too have a duty to chastise and boycott such fake manufacturers.

You would agree that all these expos, held either in India or abroad, promote trade tourism as well, because of the large inflow of

delegates and business visitors. What is your comment on this trend?

You are absolutely correct. Food trade and tourism go hand-in-hand, and food processing would also help promote tourism. We should have more food tour packages to visit various parts of the country, especially to experience Indian cuisine like ‘Malabar Cuisine’ in the Malabar Coast, or ‘Lucknow Ghana’ in Lucknow. In fact, the Ministry of Tourism should promote such tours in tandem with Ministry of food Processing, so that, there will be joint efforts in this regard. Ministry of tourism should also help Indian exporters by giving them special assistance to visit fairs abroad to promote Indian cuisine.

What is the impact of these exhibitions on product quality and adoption of latest technologies?

At exhibitions, exhibitors get a chance to see competitive products and they

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Interview

Exhibitions impact a lot in creating awareness about Indian oilseeds

Indian Oilseed and Produce Export Promotion Council (IOPEPC) is concerned with the promotion of various Oilseeds and Oils. Formerly known as IOPEA, it was formed in 1956. It was the first organized effort to promote and protect the interests of India 's export trade in commodities like Oilseeds, Vegetable Oils and Oilcakes in a collective and concerted manner through a representative body. With subsequent setting up of Sectoral Associations for different oilcakes and extraction cakes, IOPEPC concentrated it's attention and activities mainly on productivity and export of oilseeds and vegetable oils. IOPEPC is thus the pioneer body for oilseeds and oils in India and uses trade exhibitions to its full potentials to promote these products. Its current President Rajesh Bheda, in an interview to Agri Business & Food Industry, sheds light on the importance of these exhibitions to promote exports and agri-tourism. Edited Excerpts: Being the President of IOPEPC and responsible for overall trade promotion through exhibitions and delegations, please tell us about the oilseed sector's growth in last few years.

Exhibitions definitely boost exports. There has been good growth in exports of both Sesame seed and groundnut from India which clubbed together constitute about 97 pert cent of the total Indian oilseeds export. The exports of Sesame seed increased by 46.86 per cent in value terms during 2010-11 in comparison to 2008-09 and reached to a level of 2194.43 Crore in comparison to 1494.26 Crore. The exports of groundnuts in value terms increased by 69.47 per cent during 2010-11 in comparison to 2008-09 and reached to a level of 2099.76 Crore in comparison to 1239 Crore. The exports of Sesame seed in value terms during current year (April-Nov, 2011) increased by 23.02 per cent in comparison to same period previous year reaching to a level of 1663.58 Crore in comparison

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to 1352.26 Crore. Similarly the exports of Groundnut in value terms during current year (AprlNov,2011) increased by 154.64 per cent in comparison to same period previous year reaching to a level of 3000.70 Crore in comparison to 1178.39 Crore. Thus, there has been high growth in exports of both Groundnut and sesame seed from India and it sustained during current year as well. Far East countries are the major destinations for exports of Groundnuts and sesame seed viz. Indonesia, Malaysia, Philippines, Korea and Vietnam etc.

How do the exhibitions and events fit in your objectives of export promotion, and how many Exhibitions IOPEPC participates in India and overseas annually?

Exhibitions and events organised internationally and in India are very important from exports promotion perspective and IOPEPC participates in such events as far as possible. We participated in various exhibitions/ trade fairs/ Conferences and delegations abroad last year. Generally IOPEPC

AgriBusiness & Food Industry w June 2012

participates in 3-4 overseas exhibitions annually. Council along with exporter members participated in Exhibitions/ Trade fairs such as Anuga (Paris) and Gulfood (Dubai) during 201112. With this exporter members get the opportunity to create awareness about their products under the banner of the Council. IOPEPC also participated in Sesame seed conference in China held during September, 2011 and also in International Peanut Forum held in


Interview

Amsterdam, Netherlands held during 12-13th April,2012. IOPEPC also participated in the delegation to China organised by Ministry of Commerce to discuss with the Chinese authorities various measures to boost the exports of Oil seeds and Oils.

What has been the impact on Indian products exports scenario?

Above said events impact a lot in creating awareness about Indian oilseeds and there has been overall improvement in the export of oilseeds as I said it earlier.

Can you elaborate the positives and negative, if any, in national and international exhibitions?

There are only positives about the participation in exhibitions. It gives opportunity to showcase our products which India can offer. Exporters get the opportunity to meet and interact with the buyers overseas directly.

On quality front, we are

lagging behind our competitors. Can you elaborate the upcoming technological upgradation plans taken by your members?

Quality control is an important aspect and council is aware of its responsibilities in improving quality of products. Council educated exporters, manufacturer and processors, by conducting seminars in different regions of the country. In view of the changing policies of the Government of India pertaining to Exim, IOPEPC is always afoot to keep its stakeholders abreast of the scenario in respect of exports of various Oilseeds and Oils to different countries, especially in regard to maintaining the quality standards of these produces to compare with the standards adopted by the importing countries. The Trade Meets and Regional Meetings provide excellent common platforms to the members and other stakeholders to share their views and issues including quality issues.

Can you elaborate on the Certification of warehouses and processing units?

The Council has been entrusted with the responsibility of inspecting warehouses and processing units which are engaged in the exports of peanut and peanut products to various countries. The Council also extends professional advice on conforming to the standards so as to qualify for grant of Certificate. These Certificates not only accord status to the exporter but also provide traceability aimed at ensuring exports of quality oilseeds from India. Iran has become one of the attractive destinations for Indian exporters, and recently there came a delegation from Iran for import purpose. Do you have any meeting with them to explore the potentials in Iran to export our produces? We are aware that Iran is fast becoming an important export destination due to payment in Indian Rupees. We have attended various meetings regarding exports to Iran and also met with the Iran delegation. We are hoping that the export of oilseeds and oils will increase in coming years.

Spices Board to take part in International Food Expo during Olympics

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he importance of exhibitions to boost exports is further proved by the recent and business-friendly decision by The Spices Board to participate in the International Food Expo during London Olympics. In fact, it will be participating in two international food expo campaigns. The Board is aiming to put a strong, unified and holistic presentation at these two events. The first would be at the IFT Annual Meeting and Food Expo at Las Vegas during June 26-28, and the second at the Special India Promotion Campaign during the Olympics in London (August 1-2). Such a presentation will reinforce the strength and vigour of the Indian spice industry in the highly elite markets of the US and the UK, a press

release from Spices Board said. These two countries remain major buyers of spices. The IFT Annual Meeting and Food Expo in Las Vegas is a premium show frequented by leading scientists, technocrats, processors, importers and media. Showcasing Indian products at this event will give an added advantage and ensure global visibility. The Spices Board has booked a space of 60 sq m and is planning to set up a booth facilitating participation by Indian spices companies with independent space. Special India Promotion Campaign in London Olympics would have around 40 stalls which will be set up on the South Bank Centre in London. The Spices Board will have five to seven stalls where Indian spices exporting companies can

participate effectively. Facilities would also be offered to do sale of the products at the stands. This is to facilitate sale of authentic Indian spices and spice products. Indian companies can do the sales through their dealers and authorised agents. Spices Board is seeking requests from interested participants to participate and undertake sales of the products.

AgriBusiness & Food Industry w June 2012

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Interview

Indian exporters

miss prominent locations in overseas expos due to late booking Yogita Taneja Kackar, Vice President, Comnet Exhibitions Pvt Ltd, New Delhi, has been helping Indian exporters to take part in foreign exhibitions for many years, and as a representative of overseas exhibitions, she knows all the nuts and bolts of the trade expos. In a brief chat with AgriBusiness & Food Industry, she talks about the value of exhibitions to increase trade between countries, and issues and problems related to this segemnt. Excerpts:

Being the Indian Representative participating in major trade shows on Food and Processed food sectors in India and overseas, and having ample experience in making Indian Pavilions in overseas exhibitions, please tell us about the growth of exhibition segment in the last few years.

The exhibitions industry has grown manifold in the last few years. Indian exporters have become very aware of the advantages that exhibitions offer to them. They are now willing to enter new markets and unexplored territories. The Indian pavilion at some of the important food trade shows, such as Gulfood, IFE, Alimentaria, SIAL, Anuga, has grown exponentially over the last 5 years. APEDA has been instrumental in growing the Indian participation at these, as well as other food trade shows.

How do the exhibitions and events fit in your objectives of “Co-operation with other countries�?

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Exhibitions are the best platform for new as well as established exporters to enter a new market. The exhibitors also get a platform to meet current as well as new buyers from across the globe. This leads to mutual trade between the two countries. With the help of exhibitions, the world also now recognises India as a great sourcing hub for a wide range of products and services.

How many Exhibitions does your company participates in India and International annually?

Comnet Exhibitions represents more than 100 exhibitions in a year, across 40 countries and spanning 38 product sectors.

Can you elaborate on the constraints in India in comparison with developed world, which is more organized in use exhibition industry successfully to promote their trade world over?

One of the major issues we face is that Indian exporters are not comfortable in signing up and paying early for trade shows. Most of them like to wait till a few months before the show, by which

AgriBusiness & Food Industry w June 2012

time prime locations are already sold out. This is one of the reasons why organisers also do not offer prime locations to Indian companies. Slowly, but surely this mindset is changing and seasoned exhibitors are now signing up as early as twelve months before the exhibition.Another issue is that Indian companies are not so open to the idea of spending money on the look of the stand, i.e., buying raw space and designing custom built stands. Larger companies are now designing custom built booths and are realizing that it is well worth the effort and money spent. The footfalls and inquiries they receive are higher in comparison to the regular shell booths.


AgriBusiness & Food Industry w June 2012

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Trade Relations

Iran Trade Delegati on in India

Problem —

Banking! Banking! Banking!

Solution — Tejarat! Tejarat! Tejarat! — says Yahya Ale-Eshagh

To give a boost to IndoIran trade relations, Tehran Chamber of Commerce has identified two important “100 Commodities Lists”, one for export and the other for import. This step, if implemented, will take the trade between two countries to a greater level

– Anwar Huda

“M

ushkilat wajud darak,” said Yahya AleEshagh, Head of Iran’s Business Delegation, who is also the President of Tehran Chamber of Commerce, and a former Commerce Minister. Although, an efficient translator was doing his job perfectly fine rendering it as ‘difficulties do exist”, words like Mushkil and Wajud are not uncommon for an Indian audience, as both great and ancient nations share a common cultural heritage, and never to forget that Persian is one of the parent languages of our own sweet Urdu. To find a middle path during the current money transfer crisis that is quite literally wrecking Iran’s export and import infrastructure due to UN and US sanctions, and to boost trade ties between two cradles of civilizations, a High Powered Business Delegation (over 50 members) led by Yahya Ale-Eshagh visited New Delhi on 7th May. Yahya in his brief but extremely important address said in Persian, “The trade scenario between India and Iran is not as it should be, or what it can be”. ‘Mushkilat wajud darak’, he added grimly but not without hope. He also praised UCO Bank for coming forward to provide a channel for smooth cash transfer in this hour of Iranian financial crisis. “The main problem, as Arvind Mehta, Joint Secretary in the Dept of Commerce

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said, is banking! banking! banking!. The other problem areas are customs and documentations. All these are acting as hindrance to the trade relations between two nations,” he said. India’s government-run UCO Bank has been approved to be used by Indian refiners to deposit as much as 45 percent of crude payments in rupees, which will then be transferred to Iran. He also added that to give a boost to Indo-Iran trade relations, Tehran Chamber of Commerce has identified two important “100 Commodities Lists”, one for export and the other for import.

AgriBusiness & Food Industry w June 2012

This step, if implemented, will take the trade between two countries to a greater level. “Despite sanctions, I sincerely believe that both countries can sort out many problems and take bilateral trade to higher growth. There is scope of mutual cooperation and JVs in various sectors. I request ministers of India to sort out these issues to boost trade between two historical friends”. Insurance cover was another issue that bothered Iran and it found a voice through the delegation head. Yahya said that India gives only 75 per cent cover


Trade Relations to the goods of exporters and 25 per cent has to be borne by the exporters themselves, while Iran gives 95 per cent insurance cover to its exporters. He requested Indian Government to follow the same system to motivate the exporters. “If these bottlenecks are removed, there would be a chance of high investment worth 200 to 300 billion dollars in future. And bilateral trade will also boost the economy of both countries,” he said. He also hoped the face-to-face interaction would speed up the process, while stressing on the “long term” goals to be followed by two countries. With a liberal visa regime, more direct flights, trade fairs and exhibitions, the bilateral trade can be increased by at least $10 billion, he said. He also informed the meeting that Iran is developing a North-South corridor which can become a good ground for trade cooperation with Indian companies. Tijarat!Tijarat!Tijarat! (Trade!Trade!Trade!), the jovial man uttered to a receptive audience, and thanked everyone for being there to boost the bond through trade. Later, Yahya and Arvind Mehta, Joint Secretary, Department of Commerce, signed an MoU to achieve all these objectives. The High-Profile Indo-Iran Business Meet was organized by the Federation of Indian Export Organizations (FIEO). The podium saw the presence of several dignitaries from the Organization and the Embassy of Iran in New Delhi. Arvind Mehta welcomed the visiting delegation and said nearly one-third of India’s exports are from special economic zones. Iranian companies can set up manufacturing bases here and export their products to various countries. “India and Iran are identifying tariff lines under the preferential trading arrangement which need to be lowered. This will increase trade and investments in both countries,” he said. Prominent among those present were: Rafeeq Ahmad, President, FIEO, S. Saeid S. Moalemi, Minister Counselor, Iran, Ajay Sahai, Director General & CEO, FIEO, Arun Kaul, CMD, UCO Bank, U N Mitra, GM, UCO Bank, Mohsen Pakparvar, Deputy Ambassador of Iran to India, Mohammad Mehdi Rasekh, General Secretary, TCCIM (Tehran Chamber of Commerce, Industries & Mines), Rohit Pandya, General Manager,

An Iranian delegate with Indian traders

GMECGC and Anand S Seth, Adviser, FIEO. The visiting delegation had members representing various business fields of their country such as engineering, banking, petroleum products, agri products and pharmaceuticals. Agri & Allied Products Delegation Those representing Agri and Allied Products sector included Mohsen Pishehger, GM, Asia Faraz Iranian Co, Kaver Shirazi, MD, Javedankadoos Kish Co, H. Aliverdi, MD, Karafarinan Azarabadegan Co, M S Mahmoudzadeh, Chairman, Asia Faraz Iranian Co, Ali Akhondi, GM, Rezvan Co, J Kaboodani, MD, The Central Union of Khorasan Rural Ptoduction, Arash Azarmi, Member, Javedan Kadoos Kish Co, and Mohd. Ali Makarem, MD, STA Trading Group. Indian exporters and importers got a good platform to meet and reach business deals with their Iranian counterparts after the inaugural speeches. Many were seen interacting with the delegates and distributing to them their business profiles and print presentations. They exchanged contact details and had frank discussions on issues like banking and quality. The banking delegation members met the executives of UCO Bank and sought solutions to sort out practical difficulties. There was enthusiastic response from both sides. Currently, Indo-Iran trade is worth around $10 billion, and is heavily tilted in favour of Iran. Iran signaled its interest in purchasing Rs 25-30,000 crore worth of Indian goods every year. Answering a question about Hillary Clinton’s India visit and mounting US pressure on India, Yahya said he is not a political person

but an economist. “Economy does its own work and politics does its own. Trade will prevail despite anti-Iran propaganda, “he said. Later in the day, a reception was held in honour of the delegation’s visit by Friends of Iran. Another Business Meet was held in Mumbai on 8th May, which was facilitated by Indian chambers FICCI and Assocham. Traders’ Concerns Although agro products and pharmaceuticals are free from UN sanctions, which India follows, Indian trade is following a cautious approach. “Tthe business community does not want to let go of the opportunities in Iran, but at the same time, they are being cautious,” said an Indian exporter. An Indian business delegation visited Tehran in March to showcase their products. At the business meet, the worrylines were apparent as traders of both countries called for a secure payment mechanism and lowering tariffs to boost trade and sought easing of procedures to set up banks in each other’s country for hassle-free payment. US Pressure on India India found itself in an uncomfortable situation as this

AgriBusiness & Food Industry w June 2012

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Trade Relations Indo-Iran Business meet coincided with the high-profile visit by Hillary Clinton, Secretary of the State. She came with her own political agenda to put pressure on India to reduce trade with Iran, a rogue state for the US and its allies. The US wants India to play a bigger role in pressuring Iran to abandon its nuclear ambitions. June 28 is the US deadline to punish those who do not reduce oil imports

from Iran. Some of Indian refiners have already started cutting down on the import. And countries like Saudi Arabia are looking too eager to fill this gap. Meanwhile, according to a news report, India barred an Iranian bank (Persian Bank) from opening a branch in the country (Mumbai) because of U.S. pressure, making it harder for Tehran to settle oil trade payments with its secondbiggest crude customer. India imports

nearly 80 per cent of its oil needs, out of which 12 per cent comes from Iran. Bowing to US pressure, the Indian government has now reduced its import of Iran oil by 11 per cent. The report also added that since the goods under discussion between Clinton and PM of India are foodstuffs and other non-strategic items, the U.S. doesn’t have a problem with the arrangement, as long as it doesn’t violate any sanctions.

Finding quality Indian exporters is tough: Iranian delegate Given the present money transfer crisis caused by sanctions and faced by your country, do you think this India-Iran Business Meet will help to solve this pesky issue between two countries? Oh yes, hopefully‌I think certainly. It is extremely encouraging to see UCO Bank coming along with a solution to this problem, which is caused UN sanctions. It is also praiseworthy that India has said NO to follow US imposed sanctions. For me, this is very vital meeting, and of course first of its kind and I feel privileged to be here.

It was extremely difficult to snatch some time from any Iranian delegate as all delegation members were busy in an intensive dialogue with Indian counterparts as well as exporters, who were keen to conclude on-the-spot deals. But somehow, Anwar Huda managed to persuade Mohammad Ali Makarem, MD & Member of Board, Sepehr Talaee Asia Company (STA Trading Group), a major multi products (including raw sugar and rice) importer and exporter, and got him to talk about agri business between two countries, and his own business visit. Excerpts:

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Since you represent multi products segment, can you tell us what agri products do you import from India? We import mainly Basmati rice from your country, and I have come here to find suitable exporters of raw sugar, spices and soya. Iran consumes a lot of Basmati rice and they prefer Indian variety as it is longer in length and flavour is also better. What problems, apart from money transfer, do you face while importing agri products from India, and parameters you use to find the best exporters and quality? Finding quality Indian exporters is tough. Quality will be the main issue. We see a crowd of exporters, all trying to convince and impress us with a lot of promises and good quality samples, but many times, the actual shipped product

AgriBusiness & Food Industry w June 2012

is not as good as the sample usually is. This mismatch must go as trade needs honest and genuine persons. We are here to exporters who deliver what they promise and can maintain high standard. At the same time other issues like customs and documentation should also be sorted out to take the trade to a higher level. Apart from banking problem, the other major problem is unfamiliarity of Indian businessmen with Iranian trade rules and culture. They need to visit our country more to understand our system, thought process and why we are obsessed with quality. But I praise many Indian businessmen, who are already dealing with Iran, for their honesty and efficiency and love for Iran. Although, agro-products are free from UN sanctions, Indian businessmen are cautious and want clarity on the recent tightening of US sanctions that target those doing business with Iran. What do you think about this? I do not think it will affect Indian businessmen dealing with Iran as India follows only UN sanctions. And at the same time, I am hopeful that sanctions will be lifted as Iran is having fruitful meetings with UN watchdogs, and want to convince the world that what Iran is doing is for peaceful purposes.


Honey Industry

OUTRAGEOUS FORTUNE FOR HONEY TRADE Surprising trends that will reshape honey market in the next decade

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he world market of honey has changed a great deal. The biggest risk being faced by honey producing countries is climate change, and bee health is just by products of this A K Singh change. Global honey production in 2012, will most likely to be reduced as the year 2011 was an unprecedented year due to natural disasters oscillating between floods, droughts, cold waves and untimely rains, resulting in economic losses. It is a problem of scanty for honey trade. Synopsis of countries for honey production during 2011 is given hereunder; US CROP Nearly one-third of U.S. agriculture depends on the 2.4 million bee colonies for big-crop production, where bees annually pollinate $14 billion worth of seeds and crops, a Cornell University study estimates. The US crop is estimated at the year just ended to have declined to approximately 150-160,000,000 pounds, one of the lowest crops in recent times. Production in 2010 was 176,000,000 pounds, according to the USDA NASS report, and honey prices reached a peak of $1.55-1.60 /lb. Domestic sales of U.S. honey in 2011 were down by 7% from 2010. ARGENTINA Argentina, the top exporter to the US in 2011, produced approximately 75000 to 80,000 metric tons last year, with a good mix of colours. In 2009 Argentina was the top exporter to the world, at $160,000,000 [58,000 metric tons] BRAZIL Brazil’s honey production has continued to expand due to its ability to produce organic honey in its virgin areas. The market demand for organic honey gives premium prices in EU and US market. MEXICO Mexico exported over 16,000 tons to

the world in 2011, and was the 4th largest world exporter in 2009. CHINA Chinese exports to world in 2009 were the highest in volume, at 78291 metric tons. According to FAO statistics for 2009, China’s honey production topped 407692 metric tons with 78291 tons exported to the world. China’s production is still the largest in the world. It is relevant to note that in 2016, a review of China’s status as a non-market economy in US is due. If it goes in their favors, entire landscape of pricing in US will change. INDIA 1.4 million Apis mellifera colonies & unknown number of Apis Cerana and wild bees contribute production of 65000 metric tonnes of honey as per NHB Statistics. Main floral sources of honey are oilseed crops, food crops, vegetable crops, forage crops, rubber crop, spices and wild plants etc. which give Litchi, Karanj, Mustard, Herbal, Black forest Honey, Clover, Sunflower, Sunderban, Eucalyptus, Niger, Coriander honey. 2012 crop so far is 30% less than the last year. Expectation for the second part of the year looks bright. Due to ban in EU, India exported a large volume approximately 27,000 tons of Honey comprising all color grades to USA during 2011. MACRO – ECONOMIC AND MACRO –ENVIRONMENTAL FACTORS The international honey market dwells upon a macro – economic environment. Most of the importing countries are reeling under national debt and surging annual budgetary deficit.This debit characterizes both Europe and USA, where the national debt approaches a gigantic figure of $ 15 trillion. We have already seen a significant appreciation of Australian and Canadian dollar relative to the US Dollar. Value of currencies will play a key role on increasing and continuing basics in influencing honey prices. Like rising petroleum prices falling value for currencies tend to increase prices of commodities. An extremely important risk being faced by the climate change, which is surely a byproduct of integration and

growth as the ballooning of the financial markets. The opening of new market has allowed the world economic output to rise more than 150% since 1980 and pollution has grown apace. A broad scientific consensus confirms that this pollution is raising the ambient temperature of the world, on land and in water. It is a slow moving trend but its economic effects will reverberate as severely as the lightning strikes of the financial crisis. Long back, the economist Jeffrey Sachs pointed out that the main factors determining fate of nations was climate. Given the vulnerability on international honey supplies, the need to protect the health of bees vulnerable to a variety of disease and stresses, the need to ensure the safety of the food supply and nation’s WTO commitment to avoid non tariff barrier, the international honey trade needs to address the following situation: LIMITS Most of completely unsure what will happen tomorrow, If EU gets disintegrated as an economic unit. OPPORTUNITIES A new set of life style pattern emerge, which will replace today’s business hub. RISKS 1. An enormous financial grey market will arise outside of traditional centers. 2. Global warming will make temperate countries richer and tropical countries poorer. Current situation enables us to moan and groan about ourselves .We, sadly, seem to be stuck in a hole, where bees are under tremendous stress. We all are playing pantomime with crisis of climate change and economic uncertainty. We shy away from asking visionary questions. Perhaps, it is a time for hard thinking. It is also quite evident that 2012 begins with an international shortage of honey. That shortage will further intensify if weather does not support bees. All in all, honey producing countries should make objective plan based on international reality. Export prices have been fair and reasonable. So, supply chain has not experienced any disruption but markets move moment to moment. n

AgriBusiness & Food Industry w June 2012

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Press Release

launches ‘HRS ParaDice’ An innovative processing solution for diced products!

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RS Process Systems, part of HRS Group, UK, launched its much anticipated product HRS ParaDice at the Food & Bevtech 2012 which took place in Mumbai on April 25, 2012. Designed specifically for value added processing in the food sector, HRS ParaDice can process diced fruits, vegetables and similar food products to cater to their requirement in various application areas like fruits bases and toppings, fruit pulp drinks, ice creams, custard, puddings, soups, jams, marmalades, sauces with particles, fillings and coatings, health food / drinks, among others. “It is an innovative processing solution for value added food product manufacture,” said V Gokuldas, MD, HRS Process Systems Limited. HRS ParaDice is capable of processing fruit and vegetable dices without any kind of breakage. HRS ParaDice can also be used for blanching of vegetables, pasteurization and chilling of ready-to-eat fruits, etc. It ensures aseptic processing and longer shelf life of the food product without adding any preservatives and retains the organic properties, like - taste, color, smell, structure as well as the nutritional properties, like – vitamins and minerals of fruits and vegetables. The fruit / vegetable dices are pumped using HRS Hygienic Piston Pump and are heated and cooled in the highly efficient ECOFLUX Heat Exchangers. The fruit dices can be pasteurized or aseptically processed using HRS ParaDice. HRS ParaDice’s specially designed ‘dimple corrugated’ tube heat exchangers enable rapid, homogeneous and efficient heat transfer. Moreover, the Unique Piston Pump that has been enabled in this new product handles products without breakage. HRS Process Systems, one of India’s leading heat transfer specialist that operates at the forefront of thermal processing technology, caters to the food processing market with its innovative Heat Exchangers, Evaporators and systems for Food / Fruit / Beverage Processing. HRS has specialized in the design, manufacture and installation of complete process lines for the Food Industry. Presence in India Established in 2003, Pune headquartered HRS PSL has three regional offices; Delhi, Baroda and Hyderabad along with the group companies in UK, Spain, Germany, USA, Peru and UAE. Range of applications HRS PSL offers effective heat transfer solutions for an extensive range of processing applications across a spectrum of industry sectors like Chemical, Petrochemicals/Oil & Gas, Pharmaceutical, Oil & Fats, Fertilizer, Cement, Steel, Power, Agro Chemical, OEM (Original Equipment Manufacturers),

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AgriBusiness & Food Industry w June 2012

Rajesh Kackar, Secreatary of Food Ministry inaugurating the new product 'HRS ParaDice' along with V Gokuldas, MD, HRS PSL & Steven Pither, MD, HRS International, UK

Rajesh Kackar & Mr. V Gokuldas at HRS ParaDice launch at Food & Bevtech 2012

Paint, Paper & Pulp, Textile, Automotive, Sugar, Distillery & Breweries, Dairy, Food & Beverage among others. Being pioneer in the revolutionary corrugated tube technology for the process industry, HRS PSL offers innovative technology of international standard for thermal processing, evaporators, systems for food/ fruit/beverage processing with modern pumping and filling technologies. HRS PSL is ISO 9001:2008 certified along with ASME ‘U’ (The American Society of Mechanical Engineers), NBBI (The National Board of Boiler & Pressure Vessel Inspectors), HTRI (Heat Transfer Research, Inc.) and NSIC-CRISIL SE1A certifications.


Reach Over 11000 APEDA Members

AgriBusiness & Food Industry w June 2012

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Retail

News Nielsen Survey

Super retail shoppers love to buy high-end items

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ccording to a survey conducted by Nielsen, shoppers at food and grocery retail chains appear disconnected from the overall weak consumer sentiment in the country as they upgrade to premium products and buy bulk packs, helping big retailers and consumer goods firms boost average realisation per sale. Daily use products like hair oil, refined edible oil and toothpaste, and impulse-driven categories such as biscuits, beverages, salty snacks, instant noodles and chocolates are growing much faster in sales value than the number of units sold in modern trade, a report by market tracker The Nielsen Company said. Modern or organised retail within food and groceries refers to convenience stores, supermarkets and destination outlets called hypermarkets. This is opposed to the traditional kiranas or neighbourhood stores. Modern retail shoppers seem to be less impacted by economic factors like inflation, high interest rates and slower growth, said Nielsen's report. Industry officials say this trend also has to do with consumer's shopping motivations. "Consumers are purchasing larger packs and more value-added products in modern retail since they are showing a tendency to complete their monthly shopping in such stores. They are topping up

with smaller purchases from kiranas," said Dabur India CEO Sunil Duggal. Value growth of one-litre Real juice pack is almost double in modern retail than kiranas. Manish Tiwary, executive directorsales and customer development at the country's largest consumer goods company Hindustan Unilever, said modern retail consumers are comparatively better off. "The profile of shoppers in modern trade clearly reflects a higher living standard measure. This is one of the main reasons for the slightly more premium portfolio (in big chains)," he said. HUL's largest brands within the personal wash category in modern trade are Dove and Pears, while Lux and Lifebuoy rule the roost overall. Resilient Shopper Nielsen said stronger purchasing power of modern trade consumers and wider product assortment at such chains encourages impulse purchases and dealbased large-pack buys.

"This mix of affluence and experimentation is an invaluable asset for all stakeholders. This can be useful in times of uncertainty like 2011 since the sharp increases in value growth indicates resilience amongst them," Adrian Terron, Nielsen Company's executive director (retailer and shopper), said. He said refined edible oil and instant coffee are examples of categories where value growth outpaced volume growth by 2-3 times. Of course, product prices have increased 2 to 8 per cent over past year, but Nielsen said the effect has more to do with shopping behaviour. FMCG: focus on premium products Devendra Chawla, president (Food Bazaar category) of India's largest retailer Future Group, said value-added categories are incubated at modern trade outlets. "A lot more cookies, cream and health biscuits have been launched in the past 18 months than mass biscuits, which makes value contribution higher, although the category is growing double digits by volume," he said. Future Group's Chawla said launch of international foods is also contributing to this trend. This includes packaged cheese, international pasta and brands like Choco Pie among biscuits and Ferrero Rocher in chocolates that are resulting in faster value growth than volume. Overall, modern trade is proving more profitable for marketers because profit margin is higher on premium products and large packets.

New Silk Route to invest $100M for Food Ventures

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ew Silk Route has set aside $100 million (Rs 500 crore) to invest in a portfolio of four food and beverage firms by crafting a model that has never before been implemented in India. The investments will be channelled through a holding firm that will take a controlling stake of 51 per cent in mid-sized promoter-led firms in an

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initiative that has been informally termed ‘Project Gastronomy’. Promoters will be asked to cede control of accounting, human resource management and project management in return for fresh capital and handholding to expand their firms both in India and overseas. “Promoters have to buy into the fact that the whole is more valuable than the sum of the parts for this model to work,”

AgriBusiness & Food Industry w June 2012

said Jacob Kurien, a partner at the fund which invests out of a corpus of $1.4 billion in emerging Asian markets. The fund is in advanced talks with ethnic fast food chain Adiga’s, run by the Bangalorebased KN Vasudev Adiga, and another person who runs a network of fresh fruit juice kiosks. The two other companies under this umbrella will include a chain specialising


Retail

News in Indo-Chinese cuisine and a network of fine dining restaurants. Kurien declined to identify the companies it is looking to invest in. “Once we sew up the first deal, it will offer a proof of concept to other promoters,” he observed. The innovative model is a response to the challenges faced by risk capital investors in India, who have reduced the amount of money they have committed over the past few quarters in the food & beverages business. While last year they pumped in $256 million across 16 deals, there has been just one deal in the first quarter of 2012, according to Venture Intelligence. “Funds such as New Silk Route will never find one single company in the food sector to back with a $100-million deal. But food & beverages is a great investment opportunity and they are

figuring out new innovations to get a slice of the action,” said Mayank Rastogi, a partner at Ernst & Young. High valuations demanded by promoters and very low scale of operations were the reasons why New Silk Route, which is an investor in Café Coffee Day, devised this model, according to Kurien. “If market leaders are trading at 40 times over earnings before tax then smaller promoters feel they should be paid at least 20 times. That is too high a valuation,” he said. Adiga’s, which owns 12 vegetarian fast food joints across Bangalore and in the town of Maddur, has ambitions of taking the brand global. It hopes to add 15 outlets in India and overseas in three years, a person aware of the plan said. “The primary motivation for a promoter to consider such a model is the need to expand.” The New Silk Route model will also

offer a central pool for real estate and project management as well as a health and hygiene division to standardise processes that will be necessary to build a global brand. “A platform allows the opportunity of partnering different companies with diverse cultures. Funds that resort to such investments will have the confidence to back themselves in a sector,” said Jaspal Sabharwal, partner, Everstone Private Equity, which also invests heavily in the food and beverages sector. Industry analysts say this model could soon emerge as a trend as private equity managers go beyond plain vanilla financial investments to build companies with strong exit potential, something that they are struggling to do.

RBI Survey predicts slow consumer spending this year

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rowth in consumer spending is likely to be lower in 2012-13 than the previous year. The RBI's latest Consumer Confidence Survey says three-fourths of Indian consumers spent more money in 2011-12 than the previous year, amid high inflation. However, only 55.7 per cent think their expenditure will rise in 201213. There has been a noticeable drop in the proportion of respondents who intend to increase their spending next year in the latest survey vis-à-vis previous rounds. However, there was a commensurate increase in the share of respondents who intend to maintain the same level of spending in 2012-13, giving consumer goods companies some reason to cheer. There was also a slight rise in the percentage of consumers who think they will spend less in 2012-13, at 10.7 per cent. The spending sentiment is based to some extent on the consumers' views on

interest rates. Eight out of ten consumers think current interest rates are high from a borrower's point of view, while threefourths think deposit rates are low, suggests the survey. In addition, while more than half the respondents said their income increased in 2011-12 and anticipated a rise in future income, this proportion has gradually declined over the last four survey rounds. On the other hand, about one-third of consumers felt their income will remain the same in 2012-13. The proportion of such responses has been increasing in the last four quarters. Among the respondents who perceived a change (increase/decrease) in their spending as compared to a year ago, around 69 per cent reported the “cost of consumer goods” as the main factor for spending changes. Other important factors for the change in spending were changes in the cost of services, income and expenditure incurred on real estate.

The survey indicates that 85.4 per cent of Indian consumers perceived an increase in price levels in March 2012. In comparison, 90.9 per cent of the survey respondents felt prices had risen in the previous round conducted in December 2011.

To subscribe AgriBusiness & Food Industry Call : 011-64521572 or E-mail : mediatoday@vsnl.com AgriBusiness & Food Industry w June 2012

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Retail

News Spar and Max part ways in India

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utch retailer Spar International and Dubai-based Landmark Group's Max Hypermarkets have decided to part ways in India by the end of this year after the two developed differences over expansion strategy. While Spar was keen on partnering multiple national and regional retailers to expand in the country, Max Hypermarkets wanted a strategic investor for the business, Dr Gordon Campbell, managing director of the 31-billion euro (approx 2 lakh crore) Spar International, said. The companies will now pursue separate growth plans in the country, they said in a joint statement. Max Hypermarkets operates 13 Spar Hypermarkets across Karnataka, Maharashtra, Andhra Pradesh, New Delhi and the national capital region

under a licence agreement signed in 2007. The two have decided not to renew the licence after it expires in December. Viney Singh, MD of Max Hypermarkets India, said the company will rebrand its hypermarketsor, large-format food and grocery stores that also stock general merchandise, electronics and apparel-once it decides on its future course. "We believe that it is good to have in the long term, strategic investor partners to run the hypermarket business in India," he said. Spar, which has 12,000 stores across 35 countries, does not financially invest in any market, but signs license agreements with independent retailers in different markets to use the Spar brand name. It also provides technical know-how and expertise for the front-end and supply chain for its partners. In fact, it had first entered the Indian market with Mumbaibased Radhakrishna Foodland in 2004. Spar is now looking for multiple partners in India. "Given our experience now, we believe we have the opportunity for other partners to develop it (stores) at a quicker speed. We would be interested in tying up with 4-5 partners for different

Mark your dates 25-26-27, August 2012

www.graintechindia.com

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AgriBusiness & Food Industry w June 2012

regions," Campbell said, on a call from Amsterdam. He said Spar has established contact with a few partners across regions, but refused to clarify whether they were corporates or standalone chains. Campbell said Spar is willing to open supermarkets in India. The size of its supermarkets are around 1,000-2,000 square metres, while hypermarkets are above 4,000 sqm. Spar aims to finalise new relationships quickly so that its brand does not have to wind down. Campbell said this would be possible if new partners have operational stores that can be converted into Spar. Analysts say there is limited risk to brand Spar if it is absent from the Indian market for a few months because its footprint is limited. "Food and grocery is bought within a limited radius. As long as the brand's reappearance is handled well, there is no real damage expected," Devangshu Dutta, chief executive of retail and consumer goods consultancy Third Eyesight, said. He also said that it would not be difficult for Max Hypermarket to find a foreign partner, given Landmark Group's presence in India and international retailer interest in the market. Landmark Group operates department store Lifestyle International in India. "They could also come up with their own brand and partner a financial investor as they would have the operational expertise now," Dutta said. The $12billion organized food and grocery retail market that is projected to grow at a compounded rate of 30 per cent over next five years, according to estimates by Technopak Advisors.

3rd

Gayathri Vihar, Palace Ground, Bangalore, India


AgriBusiness & Food Industry w June 2012

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Corporate

News

Five firms in the race for onion storage study

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ive consultancy firms including Technopak Advisors and Yes Bank are in the race for Fresh & Healthy Enterprises Ltd's (FHEL) technofeasibility study for large storage facilities for onion and oranges. FHEL is the wholly-owned subsidiary of Container Corporation of India (Concor) and operates a cold chain infrastructure and logistics for fruits such as apples. The Ministry of

Agriculture has recently mandated FHEL to explore options for creating both short and long-term storage facilities for onions, kinnows and orange. Currently, no large cold storage facility exists in the country for storing onions for over six months. Creation of cold storage facility for onions assumes significance for the Government as shortages have often triggered political crisis. Onions are harvested normally from September to May. FHEL had invited expression of interest (EoI) from consultancy firms to prepare techno commercial feasibility studies for storage of onion, kinnows and oranges. It also includes feasibility study for creation of cold storage facility in Jammu and Kashmir and review and preparing a 10year business plan for FHEL.

PricewaterhouseCoopers and Ingersoll Rand are the other companies that have submitted their bids for the FHEL proposal. FHEL is likely to finalise the bids in about two to three weeks, a source said. FHEL operates a 12,000-tonne cold storage facility at Rai near Delhi. The Concor outfit procures apples from growers in Himachal Pradesh during the season and sells them during the offseason under its own brand – Fresh & Healthy. Over the past four years, FHEL has handled more than 35,000 tonnes of apples. It can store apples for over six months at its cold storage. FHEL leases out its cold storage facility to third parties for storing rice, vegetables such as carrot and garlic, flower bulbs among others.

Nichrome wins IPMMI Design Development Award

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ichrome, a leading packaging machinery manufacturer and the pioneer in form fill seal machines in India, recently won the Machinery Design, Development and Innovation Award 2012, conferred by IPMMI (Institute of Packaging Machinery Manufacturers of India). Nichrome won this award for the development of high speed oil packing machine – Filpack SMD. It is a double head model with an output

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of up to 70 packs per minute. The double head construction of the machine saves space and the manpower contributing to the profitability. This machine also offers flexibility of packing different oils and quantities on two different heads simultaneously. “Nichrome could change the benchmark of productivity by doubling the output with the introduction of SMD oil machine. This has helped the oil companies to handle rising demand with

AgriBusiness & Food Industry w June 2012

the same manpower and space” Said, Harish Joshi, Managing Director of Nichrome India Ltd. Nichrome has pioneered in packaging for 35 years. It has a world class modern manufacturing set up spread over 10 acres of land at Shirval, about 40 km south of Pune. The infrastructure currently accommodates a manufacturing capacity of 500 machines per year. The set up has more than 150 skilled employees for planning, engineering, supply chain, machine assembly, extensive product trials and testing, commissioning and service. Nichrome follows Lean Line manufacturing concept wherein dedicated teams are responsible f r o m execution to customer support functions.


AgriBusiness & Food Industry w June 2012

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Corporate

News

Food processors want 100% tax holiday

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he CEOs of the several food processing and FMCG firms have demanded a 100 per cent tax holiday for food processing units. They pointed out that the sector is poised to be the growth driver of the country's economy. At a CEO round-table organised by Confederation of Indian Industry (CII), the industry representatives also urged the Union Government to concedre the long pending demands such as uniform implementation of Agricultural Produce Marketing

Committee Act, promotion of cold chain industry on prive public partnership basis, fast implementation of GST for a harmonised tax structure, exemption of import duties on machinery and raw materials, and establishment of quality food laboratories. Lack of proper infrastructure in the sector is resulting in wastage of Rs 30,000crore food every year. Rakesh Kacker, Secretary, Ministry of Food Processing Industries, said: “The sector grew by an average of 8 per cent between 2006 and 2010. This is higher

than the growth of the manufacturing sector. Agriculture has also been growing 2-3 per cent which means we are adding more value to agriculture.” However, the Government is looking at resolving certain problem areas of the sector such as land, he said. He said that cold chains have been doing quite well with eight already being set up. Another 10-15 will come up by the end of this fiscal and the Government had approved another 30 new projects last month.

Traders oppose cotton reserve proposal

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he Textile Ministry has proposed to create a cotton reserve to ensure supply of the fibre to the domestic mill sector. Cotton traders oppose this move. The President of the Cotton Association of India, Dhiren N. Sheth, says that such a scheme would distort the market and unsettle other sectors of the cotton value chain. Expressing concern over the proposal mooted by the Textile Ministry on procuring 25 lakh bales of cotton through the Cotton Corporation of India for creating a strategic reserve (for exclusive sales to

mills), he said: “it is wrong to cite China for creating the cotton reserve, since the situation between the two countries are not comparable. China is a cotton deficit country, whereas we have huge surplus and the fibre is available at the doorstep of the mills here.’’ “The total investment for procuring 25 lakh bales would amount to Rs 5,000 crore approximately, not withstanding the carrying cost and annual warehouse cost. In addition to this, CCI will have to bear the loss that might arise due to fluctuation in prices.’’ “If mills contend that they are unable to stock cotton due to non-availability of

funds, it would be appropriate to address this issue through banking channels, Reserve Bank of India and the Finance Ministry rather than create a scheme which distorts the market and unsettles other sectors of the cotton value chain,’’ Sheth said and urged the Government to refrain itself from setting up a cotton reserve.

India-Switzerland to have FTA by Dec

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he Free Trade Agreement between India and Switzerland is expected to be concluded by the end of 2012, Rolf Frei Rolf Frei, Consul General of Switzerland for India, said. “Both the countries were keen on having the FTA at the earliest. The agreement will give a significant boost to bilateral trade between India and Switzerland,” he said at an interactive meeting on business opportunities in Switzerland, organised by the Federation of Andhra Pradesh Chamber of Commerce and Industry here.

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Frei said “despite the global economic slowdown, our trade graph has been looking upwards.” The two-way trade expanded from $7 billion in 2005-06 to $35 billion in 2009-10, with India being one of the most important investment destinations for Switzerland. Switzerland has always been amongst the top foreign investors in India. It stands at the eleventh position overall and sixth in Europe in terms of investments, with a cumulative FDI inflow of $1,804.63 million from April 2000 to December 2010. The Swiss capital stock in India is estimated at $3.5 billion while Indian capital stock in Switzerland was in the range of $550 million. Referring to the eurozone crisis, Frei

AgriBusiness & Food Industry w June 2012

said the economic situation had resulted in a drop in exports from Switzerland. But recession was less substantial in Switzerland than in Europe, he pointed out. He said the areas where the two countries could engage in included infrastructure, clean-tech, lifesciences, automotive, food processing, retail and precision engineering. Earlier, Frei met with the Andhra Pradesh Minister for Major Industries, Dr J. Geetha Reddy. He expressed interest in bringing a trade delegation from Switzerland to Andhra Pradesh to explore the possibilities of expanding trade ties, especially in sectors such as chemicals, petrochemicals, biotechnology, pharmaceuticals and food processing.


F&B

News Amul sales touch Rs 11670-cr

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mul, the country’s largest food brand, has widened its lead over nearest competitor Nestle, leaving the world’s largest food company a distant second despite having completed 100 years of business in India. Gujarat Co-operative Milk Marketing Federation (GCMMF), owners of Amul brand of milk and dairy products, posted sales of Rs 11670 crore for the year ended

March 2012, almost 55 per cent more than Nestle India’s Rs 7,541-crore sales. Exactly a decade ago, the gap was much narrower when Amul reported sales of Rs. 2,336.48 crore against Nestle India’s Rs. 2,075 crore. “We have managed to post 20 per cent sales growth this year with over 12 per cent value growth due to price hikes and around 8 per cent contributed by volume or demand,” GCMMF Managing Director R S Sodhi said. Amul, which has been around for less than four decades, dominates the dairy products business in the country with more than 85 per cent share in butter and 70 per cent share in cheese. But Nestle, one of the top three dairy products makers in the world that earns more than one-fourth of its €69.6 billion sales from such products, is more popular in India for its non-dairy products such as Maggi noodles and Nescafe coffee. So, why

couldn’t Nestle replicate the scale of its homegrown rival in India despite having a presence in the country for 100 years now? Piyush Kumar Sinha, professor of marketing at Indian Institute of Management, Ahmedabad, says the basic difference between the two companies has been their target audience. “While Amul has been selling products that attract consumers from the lowest strata to the top of the pyramid, Nestle has restricted itself to the top end of the market. This is the basic difference that has determined how they have grown over the years,” Sinha said. Nestle could not be contacted for comment. An email sent to the company was not replied till late on Wednesday. While Nestle has been introducing lower priced products for some time now, this pricing strategy has been mainly restricted to chocolates and beverages segment, while the company continue to position milk and curd at mass-premium level.

Buffet to enter Asian Ice cream markets

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arren Buffett, the billionaire chairman of Berkshire Hathaway, said he is pursuing more opportunities in Asia after boosting reinsurance sales and expanding the Iscar Metalworking Cos. unit on the continent. "Korea, Japan and you name it," Buffett, 81, said May 5 at Omaha, Nebraska-based Berkshire's annual meeting. Buffett visited South Korea, Japan and India last year, and China in 2010. Berkshire owned almost 4 million shares of South Korean steelmaker Posco and a stake in Chinese carmaker BYD as of Dec. 31, according to regulatory filings. Berkshire's International Dairy Queen ice-cream unit, led by CEO John

Gainor, recently opened its 500th store in China, where the Green Tea Blizzard dessert is the No. 1 seller. The subsidiary has more than 270 outlets in Thailand and expanded into Singapore last year. China is our fastestgrowing market," Gainor said. Asia, a region with the world's two-fastest-growing major economies, has become a focus for Berkshire as subsidiaries seek new markets. China's gross domestic product expanded by 9.2 per cent last year and India's by 7.1 per cent as US GDP growth slowed to 1.7 per cent from 3 per cent a year earlier. "China has got some huge companies," Buffett said. "They may eclipse the market value of some of the ones such as CocaCola that we're talking about."

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F&B

News Café Coffee Day to up the food & merchandising share

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afé Coffee Day (CCD) – the retail chain of coffee cafes – is planning to increase the share of merchandising and foods business. Merchandising and foods together account for about 40 per cent of its total business currently, said Ramakrishnan K, President-Marketing, CCD. A division of Amalgamated Bean Coffee Trading Company, CCD, would take specific initiatives such as reengineering of its food menu, adding more cafe lounges and products to its merchandise to garner a bigger share of the pie. CCD would also continue to lay thrust on expanding its beverage

business through its coffee outlets across the country, Ramakrishnan said. “Merchandising as a culture is fast picking up. It helps keep the brand young and vibrant,” Ramakrishnan said. The company currently sells its own products such as coffee powder, juices, cookies, mugs and coffee brewing machines. This apart, CCD has also tied up with IPL teams such as Kolkata Knight Riders and Chennai Super Kings for selling their merchandise. “Merchandising currently accounts for less than 10 per cent of our total business, but we see a good opportunity for growth in this segment. Sale of merchandise of

IPL teams has been a good experience for us,” he said. Foods as a segment accounts for about 30 per cent of its total sales, Ramakrishnan said. “We are largely seen as a beverages and hangout chain. To encourage consumers to have food at our joints, we launched the lounge format,” he said. CCD, which currently has 36 lounges in the country, plans to expand it moving forward. “We offer a range of cuisine like pasta and biryani at our lounge. We take adequate measures to refresh our menu every six months,” he said. Cafe Coffee Day currently operates 1,330 outlets in 185 cities in three formats – cafes, lounges and kiosks. The company plans to scale it up to 2,000 outlets spanning 400 cities by the end of 2014, Ramakrishnan said at a press meet to announce the launch of its ‘Café Moments' pre-paid cards here recently. CCD is also engaging itself strongly on the digital media platform to woo the young consumers. “Close to 30 per cent of our consumers is below 20 years of age, while another 30 per cent of our consumers are in the age group of 20-35 years. This is clearly our brand positioning and we will continue to focus on this segment,” he said.

Pepsi & PVR renew their partnership

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epsiCo India has renewed its partnership with multiplex chain PVR Ltd for five years whereby the company will sell its carbonated soft drinks, health drinks, beverages, packaged juices and water exclusively at the 166 cinema screens spread over 22 cities across India.

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With this, PepsiCo India strengthens its position as a food and beverage player in the organised multiplex category. Over the last 15 years, the partnership has evolved from a traditional supplier relationship and both the companies have undertaken joint promotions around Cricket world cup and other events. PepsiCo says the partnership will help strengthen PepsiCo India's efforts in garnering consumer insights, feedback and trials for new product development and engagement ideas. ""With more than 25 million footfalls in 2011-12 and an increasing panIndia presence, this association further consolidates our presence across the organised multiplex category. PVR is a

AgriBusiness & Food Industry w June 2012

valued strategic partner and will play a pivotal role in building scale, visibility and greater consumer engagement opportunities for our beverage brands,"" said Praveen Someshwar CEO India Beverages, PepsiCo India. PVR is a major player in key markets such as the Delhi-NCR, Bangalore, Punjab and Mumbai, and has plans to scale up presence to 500 screens by 2015. With food and beverages being the most profitable business for the multiplexes and PVR seeing close to 25 million footfalls in 2011-12, the partnership is well poised to take a clear head start in leveraging opportunities for further consolidating their leadership of the market.


F&B

News Tata Global Beverages registers 36% drop in consolidated profit

Percy Siganporia (left), Managing Director, Tata Global Beverages, and Ajoy Misra, Deputy CEO, at a press conference in Mumbai

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ata Global Beverages has posted a 36 per cent drop in consolidated net profit at Rs 85.24 crore (Rs 54.21 crore)

for the quarter ended March 31. Net sales were up by 10 per cent from Rs 1558.01 crore to Rs 1724.11 crore. According to Percy Siganporia, Managing Director, Tata Global Beverages, “The profits were lower this quarter due to exceptional items which comprised sales of shares in the previous quarter”. For the year, consolidated operating income rose by 10 per cent at Rs 6,631 crore, while group consolidated net profit was up by 40 per cent at Rs 356 crore. On a standalone basis, total operating income for the year was up by 12 per cent at Rs 2,035 crore and net profit for the year

increased by 68 per cent at Rs 303 crore. “For the year the company witnessed improved operational performance, lower interest cost and effective tax rates. Almost three per cent of the topline growth came from favourable foreign exchange translation impact,'' added Siganporia. International operations comprise 65 per cent of the company's revenues. Tata Global Beverages claims to be market leader in branded tea segment with a value share of 19.6 per cent and value share of 21.3 per cent.

Parle G re-enters premium glucose category with Parle Gold

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he Chauhan family-owned Parle Products is re-entering the premium glucose category after nearly a decade launching the Parle Gold brand. It had launched P a r l e G-Magix with variants such as chocolate and cashew in 2002 to compete with Britannia's mass Tiger brand. But consumers were unwilling to accept the idea of a ‘flavoured' glucose brand at that point of time. Subsequently in 2005 Parle G spun off the Magix suffix as a separate brand in the ‘affordable cookie' segment. This time it is enhancing its existing Parle G brand with a variant called Parle Gold which is bigger in size and has a richer formulation and is priced at a premium (Rs 10 for 100 gms). According to Mayank Shah, Group Product Manager, Parle Products, “Glucose biscuits is a staple and functional category today. At the same time there are consumers who do not want a plain vanilla product and would like to move to better taste and formulation within the category.” To hold on to such consumers, Shah says, the company has created a premium

variant – and claims it is the only company to have such a variant in the glucose category. Parle G has continued to be the single mass brand in Parle's portfolio all these years with an 80 per cent share in the glucose category. Today the 83-year-old largest biscuit manufacturer in the country believes in plugging the gaps in its biscuit portfolio. While it has extended itself in the Rs 4,500-crore glucose category from mass to premium offerings, it has moved in the reverse order in the Rs 2,500 crore cookie segment. With its new cookie offering ‘Happy Happy', it has launched an affordable variant in this category. “Since we already had premium cookie brands such as Hide & Seek and Milano, we decided to plug the gaps in the cookie segment with a mass brand such as Happy Happy with a chocolate chip cookie,” says Shah. In fact, the cookie segment (biscuits fortified with nuts and chocolates)

is growing faster today at nearly 20 per cent while the glucose segment has slowed down with just 15 per cent growth rate. Today Happy Happy is also the only brand Parle is advertising during the IPL as it has the onus of establishing the new brand.

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Marine

News Fish love on the rise in Delhi

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n a city where, for many, the love affair with food begins and ends at butter chicken, it may seem absurd to think that people are slowly shifting their culinary focus to fish. But it's true that for many, fish is slowly but steadily becoming the preferred meat. Vasudev Bijoli, who has been selling fish at Chittaranjan Park, a predominant Bengali colony in the capital, for 15 years, has seen an increase in north Indian customers in the recent months. "Bengalis and many south Indians always buy fish as it is their staple diet. But now I get over 50 north Indian customers every day compared to less than 10 earlier. Most of them buy singlebone fish like sole, singhada, pomfret, surmai," he said. Most vendors in the city get their fish from the Shazipur Fish Market. Mohd Zafar, director of a wholesale company in the market, said that in the past year or two, the demand for fish has gone up by 30-40 per cent, mainly on account of the single-bone varieties. Many are also choosing fish when they go out to eat. "Fish makes up 25 per cent of our menu, and contributes to over 30 per cent of the revenue. People here are still learning how to treat fish at home - because of the smell, how to cook it, or what flavours to use," said Parampreet Luthra, executive sous chef of Shiro. The main reason behind the shift seems to be the health benefits linked to fish. With people more conscious of growing waistlines and shrinking fitness levels, fish has emerged as the perfect solution.

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"Fish is not only a good source of protein but is also rich in omega-3 fats, which are excellent for skin, hair and cholesterol. The protein also helps curb appetite, so it is good for those trying to reduce weight," said Raghav Pande, fitness and nutrition expert, adding that he recommends all his clients to include fish in their diet. The sheer variety of fish also makes it a diet that is easy, even inviting, to follow. Local fish markets stock up to 20 varieties of Indian fish, while bigger markets and grocery superstores keep imported fishes as well. At restaurants, major part of the menus is dedicated to fish cooked in different ways - steamed, grilled, sauteed, panfried, deep fried, baked and tandoori. "We serve sea bass, sole and snapper, which we get from Mumbai and Cochin every two-three days. We also have Wild Alaskan Salmon, which we get frozen from Alaska. Our most popular dish is the steamed sea bass in lemon chilli sauce, but we also have dishes like Bengali fish curry and fish tikkas to cater to all tastes," said Pankaj Sharma, executive sous chef, Aman restaurant. "We serve sushi-grade fish - salmon from Norway, tuna from European countries, red snapper from Chennai, Vietnamese basa," said Luthra. The menu here is identical to the ones served at its branches in Mumbai and Bangalore - both fish-consuming states. Luthra said the steamed options are most popular during the day, "especially with ladies who come for their kitty

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parties", as it is a lighter option. At night, people go for sushi. When Oh! Calcutta opened here a few years ago, many were skeptical to try the unfamiliar cuisine. "But now we get a lot more non-Bengalis," said Nripendra Chauhan, head of operations at the Speciality Restaurants, which owns the franchise. However, North Indians gravitate towards dishes that have familiar flavours. "Spicy dishes like betki jhal are more popular with them," said Chauhan. Others in the industry also attest to the slight reluctance to order more adventurous fish dishes. "We have about 11 varieties of fish and 20 different dishes in the menu, but Punjabis normally go for the fish kolivada, a batter fried sole they call 'fish tikka pakoda'," said Gaurav Sachdeva, manager of coastal restaurant Spice Water Trail. Sharma of Aman also says that barring a few who like to experiment, north Indians usually order fish tikkas. "People here usually choose fish like sole or basa, which take the flavour of added herbs or condiments," said Mrigank Singh, executive chef, Blue Frog and Azimuth. Fish is low in omega-6 'bad' fats and good source of protein and omega 3 fatty acids, which help maintain heart health and cholestrol, reduce tissue inflammation, assist brain development of infants, healthy hair and skin. White fish contain less fat than oily fish Fish contain traces of mercury, which can cause problems in foetuses, infants, or young children. Some low mercury fish are haddock, mackerel, salmon, sole, tilapia, trout, and shrimp; cod, halibut, snapper, monkfish, lobster contain moderate mercury; and grouper, tilefish, yellowfin tuna and swordfish contain high levels Fresh fish are sold at markets in Chittaranjan Park fish, INA Market and Munirka. Fresh, frozen, and processed fish are sold at grocery superstores like Le Marche, Modern Bazar, and Nature's Basket. Frozen sashimi, sliced fish, and shellfish are available at specialty store Yamato Ya. Fresh fish don't have strong odour. Whole fish should have bright eyes and firm flesh, fillets or steaks should be bright without brown spots or dis-colouration Freeze until ready to cook. Thaw in refrigerator, microwave, or under cold water.


Dairy

News Hatsun Agro to take stake in power project

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atsun Agro Product Ltd has decided to take a stake in a power project, including wind mill, to meet its captive needs. The company has informed the BSE that its Board has approved a proposal to take a stake of not less than 26 per cent in a company engaged in windmill or other forms of power generation. The objective is to secure adequate

power for its operations in Tamil Nadu. Hatsun Agro is among the largest private sector dairy selling branded liquid milk named ‘Arokya'; milk products ‘Hatsun'; and ice creams under the brand name Arun Icecreams. Cost saving R.G. Chandramogan, Chairman and Managing Director, Hatsun Agro, said the company needs to secure its energy needs in the back drop of increasing costs and shortage of power.

Captive power A minimum of 26 per cent stake in a power generating entity will give it access to captive power. Hatsun's units in Tamil Nadu use over 4.5 crore units of HT electricity annually, about 1.23 lakh unit daily. Hatsun has a capacity to process over 23 lakh litres of milk daily and its power cost ranges around Rs 5.50 a unit now, he said. The company is in negotiations with a couple of power generators, he said.

JSM Corp to launch Pinkberry yogurt in India

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SM Corp, which is bringing American frozen yogurt brand Pinkberry to India later this year, is banking on experiential elements to give it an edge over the competition here. The competition includes Cocoberry, Kiwi Kiss, Red Mango and Amul. Jay Singh, Co-Founder, JSM Corp, claims not just the taste, but designer interiors and its being full-service will distinguish it from the others. A premium product, it will be housed in malls and the high street, but

“it's certainly not a food court brand”, he said. The first outlet is likely to be launched in Mumbai before the year-end. Singh would not reveal further business plans. Outlet size will range from 400-1,500 sq. ft. JSM Corp has brought other brands such as Hard Rock Café, California Pizza Kitchen, Trader Vic's and Mai Tai to India. For Pinkberry, founded in 2005 in West Hollywood, India is the 18th country it's entering. It has over 175 stores worldwide.

In the US, it had earlier been criticised for various c l a i m s about health benefits. One of them was that the product as it was made then did not qualify to be called frozen yogurt in terms of bacterial culture count per ounce.

Govt allows export of value-added milk products

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xport of casein and casein products has been moved from the prohibited to restricted category. The export of casein would now be permitted under license said the Directorate General of Foreign Trade (DGFT) notification. The Union Agriculture Minister, Sharad Pawar has been making a strong pitch for casein export. The centre had banned exports of all milk powders (including SMP, whole milk powder, dairy whitener and infant milk foods), casein and casein products since February 2011 to ensure prices remained stable in the domestic market. Casein is used for nutritional enhancement in food and in production of variety of cheese worldwide. To manufacture

one kg of casein three kg of SMP is required. The Indian Casein Manufacturers Association {ICMA} welcomed the central government decision. "The export dependent industry was lying closed for last fifteen months. The industry has suffered irreparable loss but hope to re-establish its position in the international markets soon, "said Modern Dairies Limited, promoter and ICMAmember,Krishan Goyal. Pawar said that with a bumper milk production in the country this year and tremendous supply of SMP there was sufficient inventory in the country to open the export. India, the world's largest milk producer, currently has an annual production of about 121.8 million tonnes.

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DAIRY

News Corrigendum May 2012 issue of AgriBusiness & Food Industry carried in its dairy section a published news item under the title “Dudhiyas Stand between Mother Dairy and Farmers.” Mother Dairy has issued a rebuttal, describing some of the portions in the impugned article as “misleading” and “factually incorrect.”

Parag Milk Foods to open dairy parlours

We are therefore carrying here the version of Mother Dairy Fruit and Vegetable Pvt Ltd. —Editor

Mother Dairy protects interests of both farmers & consumers At the outset, we would like to state/ mention that we were taken aback by the misrepresentation of facts in the said article, where our Organisation/ Company has been portrayed as working against the interests of the farmers. We would like to inform you that the aims, objects and endeavour of our organisation are to facilitate adequate price to the farmers for their produce, and at the same time to provide the milk to the consumers at fair price. Our reply, in respect of the factually incorrect portions in the said article, is as under: 1. Para 2 of the article mentions "Its monthly earnings are anywhere between Rs 72 crore and Rs 11 7 crore, more than those of rival Gujarat Cooperative Milk Marketing Federation (GCMMF), which makes and markets the Amul range of products" The allegation in respect of monthly earnings is misleading and also factually incorrect. The business of procuring and processing of Milk is characterized by two cycles: the lean and flush cycles. During the lean season/ cycle, the yield goes down and the procurement prices increase. There has been a sharp rise in the procurement prices in 2011. This compelled a price increase during the lean season last year. However, in order to ensure that the consumer doesn't feel the steep rise, only a calculated price revision was done. This was in anticipation of a good flush season/ cycle when the procurement prices would again come down. The MRP revision done was therefore not

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fully compensating the increase in procurement price. Our Company always strives to maintain a balance between the consumer and the dairy farmers. Therefore, a balancing act between the flush and lean seasons needs to be and is practised to run the operations efficiently. As such, Milk financials should be seen with an annual perspective rather than monthly and the Company during the financial year 2010-11 made loss in milk business. Notwithstanding the above, the Company's MRP in Full Cream Milk is cheaper than GCMMF price by Re 1. Further, as far as we are concerned, 75-80% of every consumer rupee goes back to the farmer. Statements like our monthly earning are between Rs 72 crore -117 crore and "Dudhiyas Stand between Mother Dairy and Farmers" are thus not only misleading, but is also incorrect and false. 2. Para 4 of the article mentions "Unfortunately, this has been at the expense of small farmers in North India who now get Rs 17 for every litre of milk they sell to Mother Dairy compared with Rs 30 earlier". We are (for the month of March and April, 12) paying Rs 24.50 - Rs 27 for every litre of milk to the dairy farmers. As such, the statement that price of Rs 17 for every litre of milk is being given to the farmers by our Organisation is untrue.

AgriBusiness & Food Industry w June 2012

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arag Milk Foods, the owner of dairy brands such as Gowardhan and Go, is all set to create a white flood with dairy parlours across the country. By January next, it hopes to open 150 milk, cheese and yoghurt outlets, through the franchise route. Devendra Shah, Parag's Managing Director and Founder, said, “The idea of opening these cheese and yoghurt parlours is to promote the brand and its visibility in the Indian market.” The outlets will store all our cheese products along with lassi, ghee and flavoured milk. “These are franchise outlets, so our investment would be insignificant,” he said. The dairy parlous will also educate people on the origin, making and varieties of cheese. He added that the company will be launching more natural and seasonal fruit flavoured yoghurt and lassi (sweetened butter-milk). Parag has already launched chocolate flavoured cheese in tubes for kids. The company, located in Manchar near Pune, was founded in 1992 and houses Asia's largest cheese plant with an output capacity of 40 tonnes a day. It has over 3,500 Holstein and Jersey cows. Known as the Milkman from Manchar, Shah has been able to carve a niche for himself in the growing cheese market in India. Players in this market include Britannia and Amul. The company has grown from Rs 80-crore to Rs 1,000-crore in just two decades.


DAIRY

News Low-income consumers to drive dairy growth: Tetra Pack Study

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round 2.7 billion low-income consumers in developing countries have been identified as the dairy industry's next big growth opportunity due to an expected rise in prosperity, purchasing power and desire for packaged liquid dairy products (LDP), according to a research by Tetra Pak, a global food processing and packaging company. Consumption by low-income consumers in developing markets is forecast to increase from about 70 billion litres in 2011 to almost 80 billion litres in 2014, according to the Dairy Index, which tracks worldwide facts, figures and trends in the global dairy industry. Many of these consumers are expected to switch in coming years from drinking loose milk to packaged milk. "Low-income consumers represent one of the biggest growth opportunities for the dairy industry. The key to tomorrow's success is reaching these consumers today," said Tetra Pak President and CEO Dennis Jonsson. "They make up almost 40 per cent of the world's population and live in economies driving our industry's growth and they are growing more affluent." These low-income consumers live on $2-$8 a day and are virtually untapped by

today's dairy processors. Called Deeper in the Pyramid (DiP) consumers by Tetra Pak, they make up about 50 per cent of developing countries' population and consume 38 per cent of LDP in developing countries. Half of these DiP consumers live in India and China. The Tetra Pak research focused on six countries which account for more than 76 per cent of LDP consumption by DiP consumers in developing countries India, China, Indonesia, Brazil, Pakistan and Kenya. "India offers a tremendous growth opportunity with over 220 million DiP consumer households," said Tetra Pak South Asia Markets Managing Director Kandarp Singh. "Contrary to what we have known for some time, this consumer segment is not only looking for affordability but has also become increasingly demanding on quality. We have been developing packaging solutions to address this segment and are very pleased to note that during the past years, our customers have launched several products across geographies in the dairy category at single coin-price points. The market response has been very positive and we continue to see double-digit growth rates in this segment," he added.

Many DiP consumers are expected to grow in affluence, shifting from low to middle incomes by the end of the decade, boosting their purchasing power and the range of products they buy. The increase in spending power along with greater awareness of food safety and a need for convenient, ready-to- drink solutions is expected to increase the demand for packaged products. Tetra Pak has identified three key challenges for dairy processors seeking to reach consumers in this growth market. They need to make products which are affordable, available and attractive to consumers on limited incomes. That means dairy processors must produce healthy, safe and nutritious packaged dairy products without adding unsustainable costs. They must also make them available in small traditional stores in remote rural areas or congested cities where DiP consumers shop. Innovation and efficiency will be vital in helping the industry to develop products, packaging and processing to meet the needs of these low-income consumers, according to the report.

SC issues notice to curb milk adulteration

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he Supreme Court issued notice to the central and five state governments on a petition seeking complete curb on the sale and supply of synthetic and adulterated milk and its products like ghee, khoya and paneer. An apex court bench headed by Chief Justice S.H. Kapadia issued notice on a

petition by Swamy Achuthananda Tirth seeking direction to the centre and state governments to ensure the supply of healthy, hygienic and natural milk and milk products. Swamy Achuthananda Tirth is the head of Haridwar-based Bhuma Niketan Ashram in Uttarakhand. Besides the

India's Largest Exhibition on Dairy Products &

Technologies

central government, the notice has also been issued to the Delhi, Uttar Pradesh, Uttarakhanda, Haryana and Rajasthan governments.The petitioner has sought the framing of comprehensive policy with regards to the production and sale of healthy, hygienic and natural milk to the people.

Mark your dates 25-26-27, August 2012

www.dairytechindia.in Tel.:+91-11-26681671 / 2045

Gayathri Vihar, Palace Ground, Bangalore AgriBusiness & Food Industry w June 2012

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Agribusiness & food industry- June issue