Snapshots of Food Industry News
Agro Business to fetch Adani Enterprises a 20% growth
Adani Group is likely to see a growth of 20 per cent from sales of its varied products. Their Rs.20, 000 crore agro business deals with apples, various variants of edible oil, basmati rice, gram flour and pulses and processed foods. The volume of sales is likely to reach 5 million tonnes as compared to 4 million tonnes in the previous fiscal. The sale of processed foods has been exceptionally good. The group has three main verticals Adani Wilmar Limited, Adani Agri Logistics Limited and Adani Agri Fresh Limited.
Adani Wilmar sells oil, pulses, rice and gram flour under Fortune brand. The company is also looking to expand its portfolio, though the bulk of its sales comes from edible oil, basmati rice and gram flour. Adani Agri Fresh Ltd. deals with packed apples and would also like to increase their capacity for apples. Presently they are constrained with the sale of only 20,000 tonne apples. The third vertical is Adani Agri Logistics that handles bulk storage and logistic systems for food grains. The company has 13 state of the art silos and its own rail rakes at all major city terminals.
VKC Nuts and American Pistachio Grower Tie-Up
Leading dry fruit player has announced their strategic association with American Pistachio Grower (APG) which is a non-profit agricultural association that aims to supply pistachios for mainstream cooking. The tie-up will enable VKC Nuts to introduce APG certified pistachios in India under its new consumer brand Nutraj. This is part of their strategy to source and introduce to Indian consumers the best nuts and dry fruit. The products will be available in all retail stores as well as online from Nutraj.com
Nuts and dry fruits have now entered into a phase of being lifestyle products from the luxury segment. Pistachios are popular because of their high fibre content and anti-inflammatory properties and they are also good for the heart, bones and teeth and good for diabetes. Even though the consumption of pistachios is $2.5 billion it covers only 3 per cent of the global demand. The APG certified Nutraj Pistachio variants will be vacuum packed or nitrogen flushed to ensure that they remain fresh and crisp. Nutraj also offers exotic varieties like dried cranberry, kiwi, prunes, pineapples, apple rings, figs, hazelnuts and classics like cashews, almonds, walnuts and peanuts.
Wendy all set for doorstep Delivery of Burgers
With health concerns and slimmer wallets consumers are becoming wary of fast foods and the western fast food market is seeing a downtrend. Wendy is all set to beat the slowdown in the consumption of fast food eating out by offering home delivery. Also the trend for mobile shopping rather than physical stores has slowed down eating out. Following in the steps of Burger King, Wendy will run the delivery through search service Zomato and delivery partner ShadowFax. The state of the economy as well as the traffic jams and parking problems keep consumers at home so home delivery has taken off in a big way. Wendy does not have a home delivery service in USA but is forced to follow trends or get left behind. India’s organised food market stands at $48 billion of which home delivery comprises $10 billion.
App based delivery is catching on as much in India as in China where giants like McDonald’s and KFC have had to use app-based delivery services. The competition is likely to have spill overs for consumers in the form of discounts as there are a plethora of mobile food deliver services offering a number of cuisines. The average orders through apps are about Rs.400 while fast food restaurants are seeing fewer footfalls even though Pizza Hut has initiated a ‘magic menu’ starting at Rs.25, while Domino’s and McDonald’s also have their lowest menu offer in the range of Rs.30-plus.
Shree Renuka Sugars to merge with its own UAE- based subsidiary
The largest sugar refinery in India Shree Renuka Sugars is all set for amalgamation with the UAE based subsidiary Renuka Commodities DMCC. The subsidiary trades in raw sugar, white sugar and ethanol. The amalgamation was approved at the latest Board meeting. The company operates 11 mills globally, with a total crushing capacity of 20.7 million tonnes per annum. The seven sugar mills in India have a total crushing capacity of 7.1 MTPA and two port-based sugar refineries have an expected capacity of 1.7 MTPA.
Once the merger is approved by the shareholders, creditors, stock exchanges, Karnataka High Court under provisions of sections 391 to 394 of the Companies Act and other statutory and regulatory authorities the merger will be complete. The merger will help to optimise the synergies of both the companies and bring strength to the Shree Renuka Sugars balance sheet. Since the subsidiary is fully owned there will be no transactions and no shares will be issued by the company. There is also likely to be no change in the shareholding of the company either.
FSSAI to consider Industry views when framing Product Approval Regulations
Putting a rest to all speculations FSSAI has said that they will take into consideration the views of the Industry before they frame Product Approval Regulations. Since FSSAI had to discontinue the Product Approval process after the Supreme Court Order quashing advisories they have begun work on the Product Approval Regulations. FSSAI has also had to face a spate of legal issues in the face of the various court judgements so they will be taking recourse to legal assistance while framing the regulations for product approval and imports. Chairman FSSAI has also assured the industry that they have nothing to fear.
ITC investment in Punjab Food Park to Double to Rs.1400 crore
ITC has announced that they would be doubling their investment in the Food Park at Kapurthala from Rs.700 crore to Rs.1400 crore. This was announced after a meeting with Punjab Deputy Chief Minister, Sukhbir Singh Badal. Badal met industrialists and corporate representatives and said that the state was working out on a policy to offer the cheapest power in the country to new investors. ITC have successfully made Kinnow juice and the product was under consumer testing and would be in the market within the current financial year. Dabur also expressed an interest in processing Kinnows.
As another incentive the Punjab government was in the process of banning inspectors from entering factory premises. They are also working on setting up a green-house and food park in about 100 acres at Ladhowal. Companies and farmers who take up the green house would have to pay operating costs only. Others who met with Badal were representatives from Molson Coors, Marks and Spencer, Cannon, Walmart, Dabur and Shaktibhog Atta.
In 2015 Darjeeling tea has more buyers from Europe
European countries have been able to somewhat lower the cost of tea production for Darjeeling tea growers as EU countries have made higher purchase of Darjeeling tea. Moreover the tea companies will now be selling 100 per cent Darjeeling tea from 2016 onwards. The tag of Protected Geographical Indication (PGI) status does not permit them to sell blended teas. EU is likely to pick up more Darjeeling tea in 2016. Darjeeling tea was the first PGI product from India to be registered with the European Commission. This means that only that tea which is produced in Darjeeling can be sold as Darjeeling tea. However, though exports have increased the production costs have increased too but the price has remained static. Darjeeling’s 87 tea estates have produced 8 million kg of tea this year.
Exports of Darjeeling tea are expected to be about 4 million kilograms in 2015, which is 30,000-40,000 kg higher as compared to 2014. For Makaibari Tea, that produces organic tea, the year has been excellent as they were able to fetch $25 (Rs.1, 662) for 10 grams of tea. Makaibari’s quality tea had fetched Rs.1.21 lakh a kilogram last year and they expect it to be better this year, since the good weather has improved the quality of the tea. While Makaibari Tea is on the top end, some other gardens have been able to fetch as much as Rs.7, 000 per kg at private sales.
Amul MD RS Sodhi gets Five year extension
In a board meeting of Gujarat Cooperative Milk Marketing Federation (GCMMF), which owns Amul brand, it was decided to extend the tenure of the Managing Director RS Sodhi for another five years. Sodhi has been appreciated for his tremendous marketing skills. He also has the advantage as he worked with Dr. Kurien at Amul. Sodhi did his MBA from the Institute of Rural Management, Anand (IRMA) and started his career as Senior Manager Sales at Amul itself. After this tenure of five years he will record 34 years’ service with Amul.
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