Sumit Saran World Horticulture And India Horti Expo 2009


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  • Indian grapes are 40% cheaper than Chile’s but by the time they reach the Netherlands, they cost the same
  • Changes in food are subtle but very long standing. Once a consumer goes up the curve, he does not come down
  • 0.12 percent of total fruit production in India. Average YoY growth 20-25%
  • Sumit Saran World Horticulture And India Horti Expo 2009

    1. 1. Sumit Saran The SCS Group [email_address] World Horticulture Scenario and India
    2. 2. Presentation Roadmap <ul><li>World Horticulture </li></ul><ul><li>Indian Horticulture </li></ul><ul><ul><li>India as a Producer </li></ul></ul><ul><ul><li>India as a Supplier </li></ul></ul><ul><ul><li>India as an Buyer </li></ul></ul><ul><li>Suggested Steps for Future </li></ul>
    3. 3. World Horticulture <ul><li>Growing Demand </li></ul><ul><li>Year Round Consumption </li></ul><ul><li>Shrinking Boundaries </li></ul><ul><li>Stagnating Production </li></ul>
    4. 4. Meeting the Demand <ul><li>The Giants </li></ul><ul><ul><li>Ecuador (Banana) </li></ul></ul><ul><ul><li>Chile (Apples, Grapes) </li></ul></ul><ul><ul><li>USA (Apples, Pears, Grapes) </li></ul></ul><ul><ul><li>Israel (Flowers and Vegetables) </li></ul></ul><ul><ul><li>Spain and South Africa (Citrus) </li></ul></ul><ul><li>The Movers </li></ul><ul><ul><li>China </li></ul></ul><ul><ul><li>Thailand </li></ul></ul><ul><li>Non Players </li></ul><ul><ul><li>India </li></ul></ul>
    5. 5. Global Marketing Infrastructure for Fresh Produce
    6. 6. Field Harvest Pre-cooling Shipping Pre Shipping Produce Storage Grading Packaging Wholesale Market Retail Market
    7. 7. The Issue of Cold Chain A Chain is only as Strong as its Weakest Link
    8. 8. Horticulture Business in India
    9. 9. Indian Horticulture Situation <ul><li>Significantly differing assessments </li></ul><ul><ul><li>Golden Revolution </li></ul></ul><ul><ul><li>Hyperbolic description of a fundamentally stagnant sector </li></ul></ul><ul><li>India is one of the largest and lowest cost producers of high value horticulture commodity </li></ul><ul><li>Miniscule share in global trade </li></ul>
    10. 10. The Indian farmer is globally competitive but Indian agriculture is not Source: UN Comtrade and World Bank India Share in World Production Indian Prices as Part of World Prices
    11. 11. India – The Supplier
    12. 12. Indian Fruit Production Shares Source: National Horticulture Board, GOI
    13. 13. Share in Global Trade & Production
    14. 14. Apples
    15. 15. Grapes
    16. 16. Pears
    17. 17. Banana
    18. 18. Onions
    19. 19. Mangoes
    20. 20. India - A Regional Player Source: World Bank
    21. 21. Suppliers Breaking the Distance Barrier Source: World Bank
    22. 22. Can We Overcome India can become a significant exporter of horticultural produce if it reduces its high delivery costs and improves weak standards and assessment mechanisms at home. -- World Bank Study 2007
    23. 23. Source: UN Comtrade and World Bank
    24. 24. <ul><li>Logistics and intermediation costs dwarf production costs </li></ul><ul><ul><li>Farmers receive less than 20% of the final cost </li></ul></ul><ul><li>India’s international transport costs are higher than those of competing countries </li></ul><ul><ul><li>Indian Grapes at the same price as Chile even when they are 40% cheaper at home </li></ul></ul><ul><li>Gap in standards accentuated because of poor domestic quality </li></ul><ul><ul><li>Cold storage facilities exist for only 12% of the total fresh produce. (excluding fisheries, milk and meat products) </li></ul></ul><ul><li>Trade barriers </li></ul>Impediments to Exports
    25. 25. Domestic Reality
    26. 26. Them vs. Us Very Limited and Sporadic Promotions and Programs Miniscule Trade Show Presence Extensive Trade Show Presence India Major Suppliers Needs to be integrated Governmental interventions Protocols not present Adherence to buyer protocols High Wastage Good Post harvest management Non existent Domestic quality parameters Effort on too many products Identified products for exports
    27. 27. We Need To Look Within <ul><li>Understand the difference between trade and exports? </li></ul><ul><li>Establish Competitive Advantage </li></ul><ul><li>The issue of more than 30% wastage </li></ul><ul><li>Processing what we waste </li></ul><ul><li>The reality of imported fruits </li></ul><ul><li>The issue of cold chain management </li></ul>
    28. 28. Steps Needed <ul><li>Creating an integrated and competitive supply chains for agriculture </li></ul><ul><li>Radical reform in transport, storage and distribution services </li></ul><ul><li>Pro-active engagement in international trade negotiations </li></ul><ul><li>Long term planning for promotions and trade show participation </li></ul><ul><ul><li>Fruit Logistica, Berlin </li></ul></ul><ul><ul><li>Asia Fruit Logistica, Hong Kong </li></ul></ul>
    29. 29. Ground Rules for Succeeding in Export Markets <ul><li>You cannot export what you want </li></ul><ul><ul><li>You will only be able to export what the market wants </li></ul></ul><ul><li>Quality is not a subjective thing </li></ul><ul><ul><li>Quality parameters are documented and exports must follow protocols </li></ul></ul><ul><li>Its not about good or bad quality </li></ul><ul><ul><li>It is about consistent quality </li></ul></ul><ul><li>Promotions and trade show participation decisions cannot be sporadic </li></ul><ul><ul><li>They will need long term planning </li></ul></ul><ul><li>Speed will be Important </li></ul><ul><ul><li>But Direction will be Critical </li></ul></ul>
    30. 30. India As a Buyer
    31. 31. The Times They Are A Changin’ Eating Habits Retailers/Selling Consumers/Buying
    32. 32. Changes in Consumption <ul><li>Mineral Water </li></ul><ul><li>Maggi/Instant Noodles </li></ul><ul><li>Pasta/Olive oil </li></ul><ul><li>Thai Food/Lebanese Food … </li></ul><ul><li>Pre Cooked Kebabs/Chicken Wings … </li></ul><ul><li>Pressure Cooked Cakes! </li></ul><ul><li>California Grapes/Washington Apples … </li></ul>
    33. 33. Changes in Consumption Wheat Flour / Atta
    34. 34. Changes in Consumption Rice/Pulses
    35. 35. Changes in Consumption Spices / Masala
    36. 36. Changes in Consumption Meat Products / Kebabs
    37. 37. Changes in Consumption Paani/Drinking Water
    38. 38. Changes in Consumption Fruits and Vegetables
    39. 39. Indian Fruit Import <ul><li>Imports of 77,450 MT in 2007-2008 </li></ul><ul><li>Among the fastest growing category </li></ul><ul><li>Increase of 826% from 2000-01 </li></ul><ul><li>85% of total Indian fruit imports are dominated by temperate fruits </li></ul><ul><li>USA and China are the largest suppliers </li></ul><ul><li>Other suppliers include Chile, Australia, New Zealand and South Africa </li></ul>
    40. 40. Fresh Fruit Imports Source: DGCIS, Ministry of Commerce, Government of India
    41. 41. <ul><li>Really – it does not matter </li></ul>Are you the lion or the gazelle?