Presented by-Y ogesh Kumar Mishra (11031)

I.T.S-IM GREATER NOIDA(9555141408)

THE FOOD PROCESSING SECTOR IN INDIA

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Contents*

• Food Industry in India : An Overview

• Processed Food Industry : Indian Scenario

• Processed Food Industry : Major Sectors

• Profiles of Major Players.

• SWOT analysis

• Canclustion

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WHAT IS FOOD PROCESSING?

• Food processing is the set of methods and techniques used to transform raw ingredients into food or to transform food into other forms for consumption by humans or animals either in the home or by the food processing industry. Food processing typically takes clean, harvested crops or butchered animal products and uses these to produce attractive, marketable and often long shelf-life food products. Similar processes are used to produce animal feed.

• Extreme examples of food processing include the delicate preparation of deadly fugu fish or preparing space food for consumption under zero gravity.

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Food processing in India.

• The ministry of food processing industries, set up in 1988,is the nodal agency in India responsible for developing the food processing industry. For the government of India ,the food processing industry is a priority sector thus ensuring that policies support investment and attract more F.D.I.

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The Indian Food Sector : Introduction

The food processing industry is one of the sunrise industries in India

whose potential has been well reorganized , but not satisfactorily

realized . India is one of the major food producers in the world,

• The food sector contributes to about 28 % of India’s GDP

• In terms of world ranking India stands :

– 1st in the production of Cereals, Milk & Livestock population

– 2nd in producing Fruits & Vegetables

– Ranks amongst the top 5 in producing Rice, Wheat,

Groundnuts, Tea, Coffee, Tobacco, Spices, Sugar & Oilseeds

• Total market for food products Rs. 2,500 Bn.

• Of this, processed food Rs. 1,400 Bn.

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Major players • Agro tech food• Dabur• Gits • Godrej• Haldiram• Milkfood• MTR• Parle• Cadbury • Nestle• Pepsico• Uniliver

•

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Fruits & Vegetables Processing : Capacity & Production (000 tonnes)

0

500

1000

1500

2000

2500

1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002

Installed Capacity Production

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Fruits & Vegetables Processing - Introduction

• India is the world’s 2nd largest producer of fruits & vegetables (next only to China)

• Total cultivated area of fruits & vegetables is around 12 Mn. Hectare (i.e. 7% of total cultivation area)

• Main fruits produced in India are Mango, Banana, Citrus, Guava & Apple ; these account for almost 75 – 80% of total fruit production

• The country produces around 140 Mn. tones of fruits & vegetables p.a. & accounts for about 10 % of the global production in fruits & about 13.7 % of global production in vegetables

• India produces over 60 % of world’s mangoes & 12 % of world’s bananas

• 30 % of fruits & vegetables go waste due to lack of proper processing & packaging

• Only 2 - 3 % of the produce is processed in India as against Malaysia at - 83 %, Thailand - 72 % & Brazil - 70 %

• No. of fruits & vegetables processing units : 5200

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Fruits & Vegetables Processing :Processing Pattern - Global

Country % Processed*

Malaysia 83

South Africa 80

Philippines 78

Thailand 72

Brazil 70

USA 65

India 2 - 3

* percentage processed out of total production of fruits & vegetables

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Sea Food Processing Units in India

State No. of Units

Kerala 124

Gujarat 56

Andhra Pradesh 55

Tamil Nadu 48

Maharashtra 41

West Bengal 36

Orissa 21

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Poultry Meat : Market Size

• The poultry meat processing industry is still in its nascent stage

• Around 97 % of poultry meat in India is consumed in the fresh form

• Only 3 % or about 23,000 tones is processed at present

• Western Hatcheries (part of the Venkateswara Group) were the first to set up a poultry processing unit in India (1986)

• Top 10 major players contribute for 95 % of total processed poultry meat market

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Milk & Dairy Products : Industry Structure

• State co-operatives & privately owned Indian companies

dominate the liquid milk sector

• India has around 70,000 village dairy co-operatives, 22 co-

operative dairy federations at state level & 170 milk producer

unions at district level

• Infant Milk Food, Milk Powder, Whitener, Condensed Milk, Malted

Milk Food, Butter, Cheese, Ice Cream and Ghee are the major

value added products from the Indian dairy sector

• Gujarat Cooperative Milk Marketing Federation Ltd. (Amul) and

Nestle are the leading players in the value-added segment

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Malted Milk Food : Major Players & Market Share (2001 - 02)

69%

12%

19%

GlaxoSmithKline Consumer Healthcare Cadbury India Others

In 2000, GlaxoSmithKline Beecham acquired Health drink brands “ Maltova & Viva “ from Jagatjit Industries

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Ice Cream : An Overview

• Total Market Value Rs. 10 Bn.

• Contribution from organized sector Rs. 6.5 Bn.

• Growth Rate 18 - 20 %

• Per capita consumption of ice cream in India is around 250 ml. against 22 litters in the US, 18 litters in Australia, 14 litters in Sweden & 5 litters in the UK

• This market is dominated by a few large players & a number of regional players

• There are a sizable number of players in the unorganized sector

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Biscuits : Major Players & Market Share

Britannia40%

Parle30%

Bakeman's10%

Kwality4%

Nutrine4%

SmithKline Consumer

8%

Others4%

Britannia is the market leader in value terms; however, Parle has higher share in terms of volume

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Chocolates : Major Types & Brands

Type Brand

Moulded chocolates Dairy Milk, Truffle, Amul Milk Chocolate, Nestle

Premium, Nestle Milky Bar, Nestle Classic

Count lines 5 Star, Perk, Kitkat, Picnic, Munch

Panned products Gems (Cadbury), Nutties, Marbles (Nestle)

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Potato Wafers (Crisps) : Market Size

• The market has a few national brands, a large number of regional brands and a vast unbranded segment

• The market for potato wafer is estimated at around Rs. 26 Bn.

• Of this, branded potato wafer (organized sector) contributes to around Rs. 7.5 Bn.

• Frito Lays (subsidiary of Pepsi Foods) is the market leader in the organised potato wafers market

• In the last 4 - 5 years the market for branded wafers has been growing at 12 - 15 %

• While export market is estimated at around Rs. 14 Mn., import is almost nil

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Beer : An Overview

• Market value of Beer industry is estimated at Rs. 22 Bn. (2002-03)

• Annual consumption of beer 80 Mn. Cases

• Growth rate 8 - 10 % p.a.

• United Breweries (UB) is the market leader of Indian brewery industry with around 40 % market share

• Based on the content, beer is further classified as :

– Mild / Diet Beer ( 5 - 8 % alcohol)

– Lager Beer ( 8 - 13 % alcohol)

– Strong Beer ( 13 - 14 % alcohol)

– Draught Beer ( fresh keg beer)

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Fruit Drink Market : Major Players & Brands

Company Brand  Products 

Parle Agro  Frooti, Appy  Mango, Apple, Lime, Guava, Pineapple

Godrej Foods Jumpin, Real  Mango, Apple, Lime, Guava, Pineapple

Hindustan Grapy Red Grapes, Foods, Litchi etc.

HP Agri HPMC  Apple

Mohan Meakins Gold Coin Apple juice 

Modern Foods Rasika Mango, Guava

Pepsi FoodSlice  Mango 

NAFEED Nafed    Apple, Mango, Guava, pineapple, Orange

MIDCL * NOGA Pineapple Agro

Coca-Cola Mazaa Mango

* The Maharashtra Inds. Development Corp. Ltd.

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SWOT analysis

Strengths

• Abundant availability of raw material

• Priority sector status for agro-processing given by the central Government

• Vast network of manufacturing facilities all over the country

• Vast domestic market

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Weaknesses

• Low availability of adequate infrastructural facilities

• Lack of adequate quality control and testing methods as per international standards

• Inefficient supply chain due to a large number of intermediaries

• High requirement of working capital.• Inadequately developed linkages between

R&D labs and industry.• Seasonality of raw material

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Opportunities

• Large crop and material base offering a vast potential for agro processing activities

• Setting of SEZ/AEZ and food parks for providing added incentive to develop greenfield projects

• Rising income levels and changing consumption patterns

• Favourable demographic profile and changing lifestyles

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Con…….

• Integration of development in contemporary technologies such as electronics, material science, bio-technology etc. offer vast scope for rapid improvement and progress

• Opening of global markets

• Threats

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Threats

• Affordability and cultural preferences of fresh food

• High inventory carrying cost

• High taxation

• High packaging cost

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CONCLUSION

• Diversified product mix for domestic as well as international market

• Strong research and development capabilities.

• Efficient inventory management

• Government should provide good opportunity to new emerging company in food processing ind.

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THANK YOU

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