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Risk management pulses supply chain
- 2. • India accounts for about 35% of the world area and 27% of the world production of pulses. • Pulses are grown in India in an area of 26-27 million hectares with an annual production of 17-19 million tons (mt) of which 87% is rain fed • About 90% of the global pigeon pea, 65% of chickpea and 37% of lentil area falls in India, corresponding to 93%, 68% and 32% of the global production, respectively. Source:- FAOSTAT Pulses Scenario
- 3. 6.4 4.69 4.2 7.12 6.06 6.19 7 8.36 9.88 10.46 11.12 11.03 11.26 11.5 14.76 14.57 14.66 18.24 17.09 17.45 18.5 0 2 4 6 8 10 12 14 16 18 20 2007-08 2008-09 2009-10 2010-11 2011-12 2012-13 2013-14 Production(mt) Kharif Rabi Total Source: DES-Directorate of Economics and Statistics The production of pulses in India increased by 3.35% per annum during the last decade In the year 2013-14, India produced 19.5mt pulses, that being its best performance till this year The production of pulses in India in MY 2014-15 in estimated to 18mt, slightly less than 2013-14 Pulses production Scenario in India
- 4. 21 22 23 24 25 26 27 28 0 100 200 300 400 500 600 700 800 2009-10 2010-11 2011-12 2012-13 2013-14 Area(mha) Yield(kg/ha) Yield and area under production of pulses in India Yield(kg/ha) Area(mha) • The average yield in India has increased by 100 kg/ha (around 15%) since 2009-10, yet it is below world average of 910 kg/ha. • The area under production has increased from 23mha in 2009 to 27mha in 2013 14.7 18.2 17.1 17.45 18.5 3.4 2.5 3.3 3.5 3 18.1 20.7 20.4 20.95 21.5 0 5 10 15 20 25 2009-10 2010-11 2011-12 2012-13 2013-14 milliontons Production, import and supply of pulses in India • The ever increasing demand of pulses in India has yet not been satisfied by its production • The current supply of pulses is 22.5mt Source:- www.indiastat.com
- 5. State wise statistics of pulses in India 24% 15% 13%10% 38% Major states producing pulses(Kharif) Maharashtra Rajasthan UP MP Others 33% 19%11% 9% 28% Major states producing pulses(Rabi) MP UP AP Maharashtra Others • Maharashtra has the largest production in karif season followed by Rajasthan and UP • MP has the largest production during rabi season followed by UP and AP Source:- DEC
- 6. Pulses Market in India Source : BCG Report
- 8. Potential for savings through disintermediation in Urad Source : BCG Report
- 9. Trader’s Details Name Firm Name Address Contact Chirag Agarwal(Manager) Jai Balaji Traders 3-3-108/A/4,Present Park Colony ,Near Janapriya,Hyderguda, Attapur, Hyderabad - 500048 9505327848 Chetan Goyal(Director) Komal AgroTech Private Limied D.No. 15-9-10, 1st Floor Mukhtiyar Gunj, Hyderabad - 500012 8043043926 Vishal Agarwal(Owner) Sri Annapurna Store And Supply himayat nagar,street no 10,Masjid Banda, Main Road, near hamstech college, Hyderabad - 500084 8048570713 Nanda (Owner) Adya Naturals House No. 3-4-114/5, Saichitra Nagar, Ramanthapur, Hyderabad - 500013 9849110622 Hari Nath (owner) Annapoorna Home Needs H.No- 531, D V Colony, Secunderabad, Hyderabad - 500003 8049443739 Brajesh Panda(Trader) P. S. International India Private Limited H No. 1-10-68/4, 301, Srinivasa Nilayam, Chikoti Gardens, Begumpet, Hyderabad - 500016 8048116885 Suresh Kumar Geosky Exports Road No. 1, Banjara Hills, Hyderabad - 500034, Telangana, India 9000868151 Satya Kodali(Owner) Sristi Naturals Plot #280, Jal Vayu Vihar, Kukatpally, Hyderabad - 500072, Telangana, India 9866647534 Manohar SMR Enterprises M. I. G. 134, Balajinagar, Kukatpally, Hyderabad - 500072, Telangana, India 9966734455 Raja Sekar(Manager) Celesta International 24,West Car Street, Begumpet, Hyderabad - 500016, Telangana, India +91-4634- 506601 Santosh (Managing Director) Aithas Food Private Limited Road No.39, Jubilee Hills, Near Padamma Temple, Titan Show, Room, Jubilee Hills Jubilee Hills, Hyderabad - 500033, Telangana, India 9247218393
- 10. Risk Assessment Sr. No. What is Risk Description of Identified Risk How is risk currently managed? Type of Risk 1 Spoilage Occurrence of fungus due to M.C. By sun drying and different mechanical drying method 2 Weight Loss Leakage and long time storage use of pp bag 3 Transportation Risk cost of transportation and unavailability of vehicles at the time Pre booking of vehicle and mantaining good relation with vehicle owner 4 Processing Risk Processing loss risk Skilled labour or fully mechanisation 5 Income of consumer Shift to the substitutes Not recognising the risk management 6 Quality issues: Indices Procurement from Fragmented farmers leads to different indices of the pulses Grading of the commodity 7 Adulteration Adding of the other pulses, lead chromate, metanil yellow Quality inspection 8 Consumption Shifting Moving towards meat and meat products Not recognising the risk management 9 Marketing Strategy Demand and Supply Forcasting the demand and future trading 10 Branded pulses Big giant entered in the market Direct selling to the large customers(B2B) 11 Weather Risk Uncertanity in the Monsoon Weather forecasting 12 Govt Policies(GST, Import/export) Importing pulses Not recognising the risk management 13 Commodity Market Due to Commmodity exachange there is high fluctuation Not recognising the risk management Operational Risk Strategic Risk Global Risk
- 11. Risk Assessment With Score Sr. No. What is Risk Description of Identified Risk Type of Risk Risk Calculation Impact Likelihood Score 1 Spoilage Occurrence of fungus due to M.C. Operational Risk 3 2 6 2 Weight Loss Leakage and long-time storage 4 4 16 3 Transportation Risk cost of transportation and unavailability of vehicles at the time 3 2 6 4 Processing Risk Processing loss risk 4 4 16 5 Income of consumer Shift to the substitutes 3 2 6 6 Quality issues: Indices Procurement from Fragmented farmers leads to different indices of the pulses 4 5 20 7 Adulteration Adding of the other pulses, lead chromate, metanil yellow 3 3 9 8 Consumption Shifting Moving towards meat and meat products 3 2 6 9 Marketing Strategy Demand and Supply Strategic Risk 4 4 16 10 Branded pulses Big giant entered in the market 4 3 12 11 Weather Risk Uncertainty in the Monsoon 4 4 16 12 Govt Policies(GST, Import/export) Importing pulses Global Risk 3 3 9 13 Commodity Market Due to Commodity exchange there is 5 fluctuation 4 4 16 Inference: On the basis of telephonic conversation with the various traders, we have identified above mentioned risks which are associated with pulse trading starting from farm level to end consumers. Hence, according to the scale of impact and frequency of likelihood of its occurrence suggested by the traders we have calculated heat map.
- 12. Spoilage Weight Loss Transportation Risk Processing Risk Income of consumer Quality issues: Indices Adulteration Consumption Shifting Marketing… Branded pulses Weather Risk Govt Policies(GST, Import/export) Commodity Market 0 1 2 3 4 5 0 1 2 3 4 5 LIKELIHOOD IMPACT Risk Assessment Heat Map Insignificant Mild Moderate Significant LowLow-mediumMediumMedium-highHigh
- 13. Recommendation/Strategy Risk Impact Risk Level Risk Strategy Moderate (NeedProactive Management) Level 1: • Govt. Policies needs proactive management like supply and demand scenario and according to the increase or decrease the amount of procurement Level 2: • - - Level 3: • Spoilage • Transportation risk • Income of consumer • Consumption Shifting • Adulteration Proactive management like direct contact to farmer and educate them for modern practices Implement Integrated supply chain Significant (UrgentAttention) Level 1: • Commodity Market Create more value to the farmer in terms of prices , information and other utilities Level 2: • Marketing strategy risk • Weather Risk • Branded Pulses At economic prices make available, accessible commodity to the consumer Focus on quality of the product in competitive market Level 3: • Quality issues • Weight loss • Processing Risk Primary processing at farm level Contract Farming
- 14. THANK YOU