Snapshots of Food Industry News
Al Nassma, UAE premium chocolate brand enters India via airport retail
Kempegowda International Airport (KIAB), Bengaluru has become the first sale point for UAE-based camel milk premium chocolate brand in India. Al Nassma, the premium chocolate was recently launched here and will be retailed in India by Nuance which is part of the Dufry Group. Al Nassma debuted as a confectionery over seven years ago and is being sold in the GCC, Far East, the US and Europe. The chocolate that is sold at airport duty free and gourmet outlets all over the Gulf and Europe has been launched as a travel exclusive retail in India. It has been included in the confectionery section at the Nuance-operated duty free outlet at the Bengaluru International Airport, which is the third busiest airport on the Indian subcontinent.
Burger King ties up with Online ordering app Swiggy
Burger King, the hamburger chain, and online application ordering company Swiggy have tied up to offer customers a quick and seamless ordering and delivery experience for all 23 Burger King outlets in Mumbai, Pune, Bengaluru, Delhi and Gurgaon. Concentrating on their delivery space the two partners wish to impact the hyper-local delivery space so customers can expect their Burger King orders delivered in 35 minutes. The online ordering apps have changed business and Burger King means to be part of this is also changed environment to keep pace with customer requirements. Swiggy on the other hand was launched in August 2014 and it has now raised $18.5 million from SAIF Partners, Norwest Venture Partners and Accel Partners. The company has its own fleet of delivery personnel which allows them to offer customers faster deliveries, no minimum order and multiple online payment options.
ASSOCHAM: Demand for tomato puree and ketchup increases by 25 per cent
The demand for ketchup and tomato puree has shot up by 25 per cent according to a country-wide survey conducted by the Associated Chambers of Commerce and Industry of India (ASSOCHAM). It was mainly the metropolitan cities that were surveyed. The maximum impact was seen in Delhi-NCR followed by Mumbai and Ahmedabad. More than 70 per cent of households in the middle and low income groups have had to cut down on fresh vegetable purchasing. In this scenario the demand for the ready to use versions of foods like tomato puree and ketchup, ginger-garlic pastes have increased in more than 50 per cent of middle class households.
Since the price of vegetables and pulses have increased most daily food menus in middle and low income families have also changed. Packaged vegetable cutlets, methi vadas and aloo tikkis priced at around Rs.25 are making their way into middle class homes in place of fresh vegetables and pulses. In order to balance their food budgets households have begun to stock up on tomato ketchup, sauces and tomato puree as the price of tomatoes, garlic and ginger have become unaffordable and unpredictable.
Uflex aims to be $2-billion Company by 2020
There has been a steady growth in domestic and international markets for flexible packaging. Therefore flexible packaging and plastic film maker Uflex has set a goal of $2-billion by 2020. The company feels that packaging will drive the growth. Ufex is planning to manufacture packaging material for liquid products and for this it is going to invest Rs 3,000 crore in phases for a plant in Sanand, Gujarat. Uflex is investing Rs.580 crore in the first phase and the plant should be operational by October 2016.
Uflex are going to produce a special kind of packaging similar to tetra packaging. The aseptic packaging will be made for liquid products like non-aerated drinks, dairy products, liquor and juices. Uflex has market presence in over 140 countries with manufacturing units at UAE, Mexico, Egypt, Poland and USA. In India Uflex has plants at Noida, Jammu, Malanpur, MP and it feels that with the expansion coming up at Sanand its contribution to the domestic market would increase in the coming years. In India, Uflex employs 7,400 and plans to employ around 400 at its Sanand plant.
Russia to get a Taste of Indian Milk and Milk products
Government is planning to allow two local dairy companies to export milk and milk products to Russia for six months. India is the world’s largest milk producer and exports dairy products mainly to the Middle East, Pakistan, UAE, Nepal and Bangladesh. In 2014-15, India exported 66.424 billion tonne of dairy products worth Rs.1, 205, 38 crore. Since Russia has become dairy deficient after the military intervention in Ukraine, India is planning to tap into that market. A Russian inspection team has already visited India to examine the country’s dairy industry. Parag Milk Foods and Schreiber Dynamix Dairies were able to get Russian approval as Russia demanded that dairy product manufacturers meeting Russian standards must have at least 1,000 milch animals to be able to export to the country. India is trying to convince the Russians to remove their condition as India does co-operative dairy farming, but the Russians are not in agreement presently. So that there is no monopolisation India has agreed to a six months export by these two local dairies.
Jubilant FoodWorks plans to hire 5,000 employees in FY16
Jubilant FoodWorks have the master franchise for Domino’s Pizza in India, Nepal, Sri Lanka and Bangladesh and for Dunkin’ Donuts in India. The company now plans to add another 5,000 to its 30,000 employee strength. The addition in employees will be made by this fiscal ending March 2016 and will be utilised in their 150 new Domino’s Pizza and 40 new Dunkin’ Donuts stores in India. Unlike other ordering and delivery start-ups and QSRs hit by poor economy, Jubilant is in expansion mode. It plans to invest Rs 200 crore for expansion and to set up a state-of-the-art factory in Greater Noida for Domino’s Pizza, which will be a first of its kind totally green facility. In February the company will open its1000th Domino’s Pizza store. Pizza remains the biggest revenue driver for Jubilant FoodWorks with a 70% market share. India is the second largest market for its pizza business after the US.
Tata Starbucks generates total revenue of Rs 171.2 crore
Tata Starbucks has made an 80% jump in revenues from previous year when it posted sales of Rs 95 crore through 43 outlets. This year Tata Starbucks posted revenues of Rs. 171.2 crore and their store sales were two and a half time higher than those of their competitors. Their 72 stores sold coffee, snacks and merchandise worth Rs 2.38 crore in 2014-15, higher than most other cafes and quick-service restaurant chains. This is mainly because of premium pricing and their locations which attract customers. Their nearest coffee competitor Cafe Coffee Day, had retail revenue of Rs 1,326 crore from 1,538 cafes with about Rs 86 lakh annual sales per store. Jubilant Foodworks, with over 930 Domino’s Pizza and Dunkin’ Donuts outlets had sales of Rs 2,074 crore, equivalent to Rs 2.23 crore per store on average. Of course CCD pricing is much lower than Starbucks but Starbucks pricing will need to level out once they expand into Tier II and III cities.
Starbucks opened its first India store in October 2012 and it now has 78 outlets and its pace of expansion has been a record in Starbucks’ 43-year history especially as the market has been subdued. This is because unlike global consumers who are attuned to a takeaway culture, many office goers and students go to cafes to relax and spend hours over coffee and snacks. Real estate costs in India are also high so retailers need to realise their price per square foot of space.
Permanent solution on food security at WTO in sight: Nirmala Sitharaman
Commerce and Industry Minister, Nirmala Sitharaman said that she does not see any obstacles on the WTO members being able to provide permanent solution to India’s food security issue. The food security issue also affects other developing countries besides India. Since the highest decision making body, the WTO’s General Council, has accepted India’s demand for extending the peace clause, till a more permanent solution can be found for India’s food stockpiling issue. Therefore, there should be no problem if India continues to stockpile food grains for distribution as subsidy to the weaker sections. India has proposed an amendment in the formula so that the subsidy cap can be calculated at 10 per cent which is based on the reference price of 1986-88. If by 31 December a solution is not found then the peace solution will continue till a solution is found.
Meanwhile the government has begun to work on the trade facilitation agreement (TFA) for which the Finance Minister has already made a lot of announcements. Ports will likely run more efficiently as it will be online, customs should be available 24×7 and easing customs norms and procedures for smooth flow of goods across the globe will be faster as even WTO members have agreed on these.
Tamil Nadu Agricultural University has Memorandum of Understanding with World Food Preservation Center
According to a varsity press release the Tamil Nadu Agricultural University (TNAU) has signed a Memorandum of Understanding (MOU) with The World Food Preservation Center (WFPC) LLC, to reduce postharvest food losses in developing countries and diminish world hunger. Dr. S. Mohan, Dean (SPGS), TNAU has developed innovative technologies for the postharvest preservation of grains/seeds of agricultural and horticultural crops and he was responsible for this collaboration with WFPC. The WFPC, LLC is a consortium of twelve universities located across the globe and ARO Volcani Center in Israel. The non-profit World Food Preservation Education Foundation has been recently formed to provide scholarship for students to attend Universities that come under the WFPC, LLC. On the other hand TNAU offers thirteen undergraduate degree programs, thirty three post graduate degree programs and twenty-six doctoral programs all over Tamil Nadu. TNAU has 32 research centers for agrotechnology development and 14 Farm Science Centers (KVKs) for outreach. The MOU was signed at Shepherdstown, West Virginia, USA.