Professional Documents
Culture Documents
March 7, 2007
Sanjeev Asthana
Agenda
Introduction
Horticulture Sector
Market Scenario
Horticulture Sector in Africa
Market Trends Need for Differentiation
The fundamental belief for us is that growth is life and we have to continue to grow at all times
- Mukesh D Ambani Chairman & Managing Director
The Opportunity
Extrinsic Factors
Government initiatives and Policies
Changing demand
In OECD countries
More variety (product differentiation) Higher quality requirements Niche products, organic, labels
Year-round demand
In developing countries
Income growth Urbanization More consumption of high value products
Horticultural Trade
Volume increased from 37 million MT in 1970 to 135 million MT in 2003 Value increased from US$ 6.5 billion (1970) to US$ 90 billion (2003) Nearly 21% of all agricultural export value in developing countries
Horticulture in Africa
Africa Produces around: 13% of World Fruits 8% of World Vegetables Challenge today in underdeveloped
Marketing Infrastructure Food Processing
Source: FAO data, Totals mentioned here are for total F&V production in Region
Negative Growth
Africa Share in World Production is continuously Decreasing Horticulture will be the growth driver for the African Continent Focus should shift towards enabling infrastructure for the growth of sector
Canned Pineapple is a case of success story Value addition through export of sliced pineapples
Logistics
Retailing
More jobs, more income Horticulture - more jobs / hectare than most other crops Horticulture - potential for off-farm employment - value-addition - processing Increasing importance of horticulture in rural economies
Increased Employment
Average number of labor days per hectare for production of cereals and vegetables Country
Cambodia Vietnam (southern) Vietnam (northern) Bangladesh Lao PDR Philippines India
Cereals
81 111 216 133 101 93 80
Vegetables
437 297 468 338 227 185 124
Increase (%)
440 168 117 154 125 99 55
Horticulture produce is ideal for small farmers since they are labor intensive crops Employment also gets generated through value addition activities like food processing.
Source: Weinberger and Lumpkin, 2005
Higher Incomes
Percent difference in net farm income among smallholders growing horticultural crops and rice Country Kenya Lao PDR Cambodia Vietnam (northern) Vietnam (southern) Bangladesh Difference 497 380 117 189 20 29
Most of Horticulture produce is cash crops results in higher realizations Employment also gets generated through value addition activities like food processing.
Source: Weinberger and Lumpkin, 2005
Development of Agro-Industry
Processing of fruits and vegetables (cashew, black pepper, Innovative Packaging can transform the value realizations for the African produce
Existing Products
Phase I
New Products
Phase II
Work on growing products that large developed markets like US & EU consume.
Africa varied soil & climatic conditions support farming of almost every fruit & vegetable
Safety
Personal Communal Environmental
Gratification
Pleasure Im worth it
Product
Performance Individualism Target specific
Convenience
Saving time Energy and Space
Clean
Organic Sustainability Contaminant free
Control
Nutrition Rich Anti Aging Self Medicated
Quality
assurance
Comfort
Sensory Ethnic Indulgence Premium
Expedient
One-Handed functionality
Functional
Packaging
Key Market for the African Produce is European Markets which are highly evolved in terms of quality and niche needs
Pineapple
Global market growth: 6% annual Cte dIvoire: 2% yearly growth Costa Rica: more than double volume over 5 years Ghana: 45% growth over 5 years, reaching 3rd position in EU supplier Value addition by Slice Pineapple Exports
Value-adding Packaging
Differentiation by understanding the needs of the customer; Convenience and Food Safety Will be the key Differentiators
Thank You