Food Processing Industry In Chhattisgarh What Now And Beyond

Team: The Corporate Strategists Debopom Majumdar (PGDM BD) Hrishikesh Deshmukh (PGDM BD) Welingkar Institute Of Management Development And Research, Bangalore

Growth Drivers for Food Processing Sector Chhattisgarh

Huge Production Base Changing Consumer Preferences Organized Retail and Food Retail

Export Opportunities

Government Support
Life style Factors Health consciousness, convenience

SWOT Analysis Of Food Processing Industry in Chhattisgarh

Strengths
1. Favorable Climatic condition. 2. Demand Driven Market Due to Rapid Urbanization. 3. Primary Occupation in state is Farming. 4. Good Transportation Network 5. Location Advantage of Sharing Borders with six other states

Weakness
1.Low and Declining productivity 2.Traditional Business & Farming Practices 3.Less Net Irrigated Area 4.Lack Of Agri-Infrastructure 5.Lack Of Organized Market or Mandis at block level

Food Processing Industry

Opportunities
1. Scope for Crop Diversification Paddy Farming to Horticulture 2. Huge Demand For Off season crops 3. Presence Of Technical Institutions that can Provide Modern Knowledge in this Field 4. Domestic Market and Exports

Threats
1. Excessive Use of Chemical Fertilizers and Pesticides will cause decrease in Productivity 2.Lengthy procedure to access credit facilities from banks de-motivate the farmers

Constraints
Fruits & vegetables processing Industries
Fruits and vegetable Loss due to lack of proper handling, transportation and storage from farm to processor. Absence of forecasting facilities. Presence of Intermediaries. Non availability of feed and fodder. Aggregation is difficult due to low quantity and disperse production rate. Large number of animals with low productivity.

Dairy

Grain based products

Food Grains Loss at farm level due to rodent and moisture, Lack of proper storage structure.

Meat , poultry & Fish Products

Traditional and inefficient methods of fishing and poultry. Bottlenecks in infrastructure.

Isolated schemes operated by various ministries or departments of government have not been able to address need gaps. Availability of right quality of labor.

Focus Areas for Food Processing Businesses

Fruits & vegetables processing Industries
Production of offseason fruits and vegetables like banana, papaya, cauliflower etc. Convergence with MNREGS helps in effective implementation providing protection, irrigation, maintenance. Developing network of cold storage and cold chain. Strengthening and consolidating organic cultivation and achieving organic certification.

Dairy
Dairy development in the state should take cluster approach in milk production enhancement should be undertaken. Livestock Insurance.

Grain based products

Procurement of High quality seeds production. Paddy hay can be used in mushroom cultivation.

Meat , poultry & Fish Products

Modernization of abattoir. Contract farming model to be adopted.

Focus Areas for Food Processing Businesses

Production of Medicinal Plants based Neutraceuticals, cosmetics and food supplements. Finance for food processing sector. Leverage terminal markets to produce quality produce at right price and operate on hub and spoke format. Food safety and hygiene R&D, knowledge management and HRD

Policy And Action Prescription

Availability Of Raw Material Increase in productivity and area of horticulture. Reduce or minimize post harvest losses. Increase Availability of raw materials at reasonable price. Development Of Infrastructure Food park, Material cold chain, Logistics & Transportation development, Power utilization Developing overall conducive Investment climate Establishment Of specialized financial institution that would cater the needs of entire food supply chain and its unique characteristics (Micro credit groups for production processing and marketing). Encourage investments both domestic and foreign through incentive mechanism and simplified procedures. Food Processing Encourage existing units and investors to adopt most efficient technology, processes and management practices. Reduce duty on import of technology and machinery. Encourage agro processing facilities close to area of production to avoid waste and reduce transportation cost. Marketing And Distribution Encourage Increase in Modern format of Food Retail.

Policy And Action Prescription(cont..)

Taxes
Appropriate policies for level of state taxes on availability and charges for land ,water, power etc. Rationalize central or state duties and levies on processed food machinery etc. so as to reach international bench mark Rationalize duty and taxes particularly on packaging material, machinery and R&D setups.

Food Safety And Testing

Strengthen testing infrastructure, Generate time series scientific data for policy making standards setting via establishing food testing laboratories. Undertake generic campaign for promoting consumption of processed food based on safety, nutrition and convenience. Establish strong database on website to surf as online market intelligence which should be updated continuously. Promote aggregation of small producers( particularly organic produce) to build scale to make sourcing buyable for importers. Promote packaged , Ethnic and Traditional food ( specially among NRIS). Upgrade airport storage and handling. Promote abattoir an integrated meat plants for meat export. Make special arrangements for them to access technology, knowledge of market and soft credit. Develop SSI clusters, anchor industrial centers or their linkage to have a network of small and tiny processing units.

Market Creation And Intelligence

Exports

Small scale & Unorganized sector

Strategy & Implementation

Increase in the scale of operations
mergers, acquisitions, alliances resulting in the scale of economies and reducing the cost.

Investment in infrastructure and technology

Investment in green houses, irrigation, warehousing, shipping facilities to meet quality and consistency requirement of retailers. Infrastructure development through private sector participation. Need to develop a parallel distribution channel to cater needs of organized format. Improve the consistency in supply and quality. Develop cost competitiveness by removing intermediaries and preventing wastages and losses. Development of adequate storage and distribution infrastructure.

Supply chain alignment with international requirements.

Improvement in Market access

Market Intelligence Harmonization with international standards/practices , certification and testing. Support for backward integration

Thank You