Transcript EMERGING OPPORTUNITIES IN AGRI BUSINESS

Dr. N.R. PADMANABAN
Professor & Head
Department of Social Sciences
Anbil Dharmalingam Agricultural College
and Research Institute,
Tamil Nadu Agricultural University
Trichy - 9

John H. Davis – Harvard University – first person –Agri business –
1955

In 1980’s, three connotations
a.
Synonymous with agriculture
b.
Synonymous with agricultural economics
c.
Modified agriculture excluding farming or off farm Agri.

AB means all business enterprises that buy from or sells to
farmers / traders / consumers

Three components of AB
a.
Productive resources – seed, fertilizer, equipment, machine.
b.
Agricultural commodities – raw and processed
commodities.
c.
Facilitative services – credit, insu., mark., stor., proc., trans.,
etc.,

Varied agro climate offers enormous scope for production
of temperate, sub tropical and tropical agro produces

Enormous demand for Agri. inputs like seed, fertilizer, bio
fertilizer, pesticides, feed and fodder, so on.

Seed – Hybrid, GM, improved seeds

Bio technology in Agri. – seed, fertilizer, bio control agency,
microbes for bakery products

Export of Agricultural produces – cereals, pulses, oilseeds
and oils, spices and condiments, fruits and vegetables,
flowers, medicinal plants and essential oils, agricultural
advisory services, agricultural tools and implements, meat,
milk and milk products, fish and fish products, ornamental
fish, forest by products etc.
Horti. – fruits, vegetables, flowers (cut flowers), ornamentals,
Organic farming - vast scope
Processing – Increased popul., urbani., indust., working women,
civilization and less timing for cooking
Fishery
Livestock
Forestry
> 8000 km (costal), inland, rivers, ponds, tanks,
ornamental fish
- Meat- mutton, chicken, pork, beef, milk and
milk products, egg - increased dd
- Timber, fuel, lac, resin, gum, medicinal plants
and other forest by products ( paper and pulp)
Sericulture -
Silk industry
Mushroom - Button, oyster, paddy straw – delicious food
Micro irrigation - Labour saving, water saving, increased
productivity, efficient use of resources, sprinkler, drip
Marketing, transport, warehousing, cold storage, credit, insurance,
consultancy etc.
Human resources in agriculture – trainee, agrl. Extn., consultancy
Indian wastes more fruits & vegetables than are
consumed in UK
Cumulative waste is about $ 6.7 billion which is
equivalent to 40% of the total horticulture produce
Poor infrastructure and logistics support
Rough and unorganized handling
Five Year Plan
Overall GDP
growth rate
Agriculture and
Allied source
Seventh Plan (1986-1990)
9.0
3.2
Eighth Plan (1992-1997)
6.7
4.7
Ninth Plan (1997-2002)
5.5
2.1
Tenth Plan (2002-2007)
7.6
2.3
Eleventh Plan(20072012)
8.16
3.6
8
4
Twelfth Plan (2012–2017)
(target)

Investment in agriculture as a percentage of GDP at
constant prices – 1990-91: 1.92


90-91 -
Rs.14836 crores (10441 Pvt., + 4395 Public)

05-06 -
Rs. 54539 crores (41320 Pvt., + 13219 Public)

2010-11 - Rs.1,42,254 crore
The Gross capital formation (GCF) in the agriculture and
allied sectors in the country rose by 87 per cent to
Rs 1,42,254 crore in the 2010-11 as compared to 2004-05.

7566 regulated markets.

21780 rural primary agricultural markets

Public- Private -Partnership (PPP)- emerging focus

Marketing reforms - MOA - New model law – enables
establishment of Private markets, direct purchase centres,
consumers markets, farmers markets, PPP, etc.

Provision for State Agricultural Produce standards bureau
– for grading and standardization quality certification.

MNCs, Big corporate are entering agrl. marketing.
India ranks first in the world in cereal and milk
production and second in fruits & vegetables and in
five producers of groundnut, rice, wheat, tea,
coffee, sugar, spices & oil seeds.
Even with an industry size of US $ 70 billion,
process less than 2%.
The industry has about 1.6 mn direct employees
and accounts for about 13% of the country’s
exports and 6%of the industry investment.
Data integration,
Financial flow management,
Supply-demand matching,
Collaborative forecasting,
Information sharing,
Goods movement synchronization through
efficient transport scheduling
Crops
1951
2001-02
2010-11
Rice
20.58
93.08
96.0
Wheat
6.46
71.81
86.9
Bajra
2.60
8.35
10.4
Maize
1.73
13.30
21.7
Jowar
5.50
7.79
7.0
Total cereals
42.41
198.83
226.3
Total Pulses
8.41
13.19
18.2
Total Food grains
50.82
212.02
244.5
Ground nut
3.48
7.21
8.3
Total oil seeds
5.16
20.80
32.5
Crops
1951
2001-02
2010-11
Sugarcane
57.05
300.10
342.4
Cotton (Million Bales)
3.04
10.09
33.0
Fruits
NA
49.50
74.87
Vegetables
NA
85.00
146.54
Total F&V
NA
134.50
221.42
Milk
17.0
84.60
121.8
Source: S.S. Acharya and N.L. Agarwal, Agrl. Marketing in India,
( New Delhi : Oxford and IBH, 2004) &
Economic Survey various issues
INDIA’S EXPORTS OF AGRO PRODUCTS
Qty in MT
Value in Rs Lakhs
Cereals
2010-11
Cereals
Qty
Non
Basmati
Rice
100685
Wheat
394.47
Maize
3010423.4
Other
Cereals 209647.62
Total 5691810
Value
23128.8
69.96
335946
2011-12
Qty
3997719
740746
3855721
Value
2012-13
Qty
Value
865912 6687990 1444880
102326 6514810 1052900
515751 4788328 709634
28902.0
217962
33540 652975 108427
1523511 11990324 3062491 22104004 5256781
INDIA’S EXPORTS OF AGRO PRODUCTS
Qty in MT
Value in Rs Lakhs
Floriculture products
2010-11
PRODUCT
Qty
Value
2011-12
Qty
Value
2012-13
Qty
Floriculture
28906.79 29604.04 30926.02 36532.15 27121.8
Fruits &
Vegetables
Seeds
11622.33 18491.77 15205.81 28776.35
Value
42344.6
17168 34772.39
Total 40529.12 48095.81 46131.83 65308.5 44289.8 77116.99
INDIA’S EXPORTS OF AGRO PRODUCTS
Qty in MT
Value in Rs Lakhs
FRESH FRUITS & VEGETABLES
2010-11
Commodity
Qty
Fresh Onions
Value
2011-12
Qty
Value
2012-13
Qty
Value
1182324.2 177928.62 1309924.8 172299.8 1666872.6 196662.66
Other Fresh
Vegetables
499320.05 92138.76 734178.83 131048.2 768627.2 151633.56
Walnuts
5762.34 16629.25
5841.56
16483.6 63441.29
23108.4
5295.47 19983.57
Fresh Mangoes
58863.41
20974.3 55584.99 26471.78
Fresh Grapes
98005.12 42830.28 108584.57 60288.15 172744.42 125942.78
Other Fresh
Fruits
255024.83 51175.27 270437.2 75541.11 263970.29 77975.78
Total
2099300 397185.8
2492408
483260
2933095 598670.1
Contd..
INDIA’S EXPORTS OF AGRO PRODUCTS
PROCESSED FRESH FRUITS & VEGETABLES
2010-11
Commodity
Qty
Value
Cucumber and
Gherkins( Prepd. &
209231.83 51525.79
Presvd)
Dried & Preserved
Vegetables
49009.12
2011-12
Qty
Value
Qty in MT
Value in Rs Lakhs
2012-13
Qty
Value
258603 74503.45 238624.89 85659.18
37333.5 64794.09 52678.47 68520.25 63795.76
Mango Pulp
170219.72 81893.27 150499.06 62082.91 147815.69 60855.73
Other Processed
Fruits &
Vegetables
199868.41 99704.05 274807.05 157759.82 269217.26 173305.54
Pulses
209010.49 87004.28 174625.18 106793.13 202751.36 128500.32
Total 837339.6 357460.9 923328.4 453817.8 926929.5 512116.5
Contd..
INDIA’S EXPORTS OF AGRO PRODUCTS
Animal Products
Qty in MT
Value in Rs Lakhs
2010-11
Commodity
Buffalo Meat
Sheep/Goat Meat
Other Meat
Processed Meat
Poultry Products
Qty
2011-12
Value
Qty
726670.22 861324.17 986618.46
2012-13
Value
Qty
Value
1374574 1107506.3 1741289.3
12298.38 25879.45 11181.04 25522.07 16046.91 42565.86
1021.79
967.42
318.33
364.34
194.13
233.33
922.2
1395.53
575.94
949.53
796.92
937.41
516754.71 31433.28 624181.11 45805.29 577864.27 49493.41
Dairy Products
37435.87 54797.37 25639.51 28935.68 87824.21 141209.83
Natural Honey
25979.21 30086.76 26089.03 32123.96
25780.7 35632.05
Albumin
( Eggs & Milk )
Total
1235
1334705
1663.83
1831931
3954.66
1049954
1454.31
1677820
5302.71
1520002
9016.14
2077840
Commodity
Countries
Tea
Russia, UK, Iran, Japan, Germany,
Egypt, UAE, Saudi Arabia, Poland,
Afghanistan, Australia,
Czechoslovakia, USA and Yugoslavia
Coffee
Russia, Yugoslavia, Italy, Japan,
Germany, Romania, Australia, Belgium,
Finland, France, Iraq, Kuwait, Norway,
Spain, UAE, USA and UK
Basmati rice
Saudi Arabia, Russia, Japan, Oman,
Nepal and Kuwait
Wheat
Vietnam socialist Republic
Tobacco (manufactured)
Saudi Arabia, Russia, Japan, Oman,
Nepal and Kuwait
Commodity
Countries
Spices
USA, Russia, Saudi Arabia, UAE, UK,
Japan, Canada, Czechoslovakia,
Germany, Italy, Nepal, Netherlands,
Pakistan and Yugoslavia.
Cashew Kernels
Russia, Netherlands, Czechoslovakia,
USA, Singapore, Japan, Australia,
Canada, China, Germany and Hong Kong
Groundnut
Russia, Czechoslovakia, Germany,
Netherlands, Singapore, Yugoslavia and
UK.
Oilcakes
Russia, Romania, Saudi Arabia,
Czechoslovakia, Germany and Poland
Raw Cotton
Japan, Romania, Russia, Poland, China,
Hong Kong, Bangladesh, Belgium,
Germany, Italy, Korea, UK, Switzerland
and Singapore.
Commodity
Countries
Fresh Fruits
UAE, Saudi Arabia, Kuwait,
Bahrain, Qatar, UK,
Bangladesh and Russia
Fresh Vegetables
Saudi Arabia, UAE, Oman and
Singapore
Onion
Malaysia, Sri Lanka and Middle
East
Processed fruits and
vegetables
Russia, UK and Middle East
Source: Vikas singhal, Indian Agriculture
Types of Agribusinesses
Most of the small businesses can be classified as following
types:
Production
Retailing
Distribution
Personal services
Professional services
Financial
Franchising
Farming (on farm)
Crop
Dairy/Poultry/Goat
Fish
Rabbit
vegetables
Flowers
Ornamental plants
Palmyra
Fodder
Sericulture
Agro-forestry
Beekeeping
Mushroom
Inputs marketing
Fertilizer
Agricultural Chemicals
Seeds
Machineries
Animal feed
Poultry hatchery
Landscaping
Vet medicines
Agricultural credit
Custom service
Bio-control units
Bio-tech units
Product marketing
Wholesale
Retail
Commission Agent
Transport
Export
Finance
Storage
Consultancy
Processing
Milk
Fruits
Vegetables
Paddy
Sugarcane
Cashew
Coir
Poultry
Cattle
Tannery
Brewery
Facilitative
Research and Development
Marketing Information
Quality control
Insurance
Energy

1950s – Few hundred quintals of seed

21 state seed corporation

101 notified STL / 7 in Tamil Nadu



NSC estd., in 1963
Around 100 major private sector seed companies
75-80 percent of the hybrid maize, sorghum, millets, sunflower,
cotton and vegetables – marketed by private firms.

Hybrid rice 95%, Hybrid maize 98% and 100% sunflower – by
private

AP – seed capital of India (59% of cotton, 86% maize, 93%
sorghum etc.,)
The major private players are

MAHYCO,

Indo American hybrid Seeds,

Proagro Seeds,

Mahindra Hybrid Seeds,

Krishi Dhan,

Nath Seeds,

Nizuveedu Seeds,

Cargill Seeds,

Kanchan Seeds,

ankur Seeds, Advanta (India),

Syngenta,

Spic PHI-Biogene,

Ajeet Seeds,

Paras Extra Growth,

Ganga Agri. Seeds,

shriram Bioseeds,

Raasi Seeds,

Sun Seeds and J.K. Agri-gemetics, etc.
Lakh qtl

GM seeds as shown rapid growth in USA in recent times

BT (Bascillus Thuringiensis – soil Bacterium) cotton
introduced in India October, 2002. – resistance to American
boll worm.

Recorded 35% higher yield

Monsanto MAHYCO’s Bt Cotton

Raasi Bt cotton
Source: Vikas singhal, Indian Agriculture

Altering or introduction of a character or evolving a new organism
using invitro techniques
Bio Technology
Plant Tissue
culture
Animal Cell
Culture
Transgenic crops/
Animals /
Microbes
commercial
drugs/ medicines
Commercial
Micro propagation
Mass multiplication of plantlets
Under invitro with small space
& initial plant materials
Initial cost 50.00 lakh for small lab
Production 1 crore seedlings
Secondary metabolite production
Alkaloids (medicines)-using
cell culture
With small fermenting industry
Variable medicines

TERI – New Delhi

Harrison – Malayalam – Kerala

SPIC – Bio Tech – Chennai

Grow more – Dharmapuri

Indo American, Rallis India – Bangalore
Tissue Culture Plants – Banana
–
(Grant , Robusta)
Pomegranate
Cardamom
Archids / cut flowers
Tree plants / Tea
Year
Cooperative
Banks
Commercial
Banks
RRB
Grand
Total
1980-81
2126
1263
-
3389
1990-91
3973
5010
-
8983
2002-03
35111
41217
5745
82073
2010-11
78121
345877
44293 468291
Source : Govt. of India, Economic Survey various years
(lakh tonnes)
Year
Domestic
Production
Imports
Consumption
1951-52
0.39
0.52
0.70
1990-91
90.44
27.58
127.00
2001-02
146.28
20.91
167.02
2011-12
163.61
123.68
277.40
Source : Fertilizer Statistics
Year
Consumption per ha of GCA (Kg)
1960-61
1.90
1970-71
13.60
1990-91
72.57
2001-2002
90.12
20011-12
144.33
Source : Fertilizer Statistics
BIO FERTILIZERS:
Rhizobium - Earlier
Now –
Azotobactor , Azolla , Azoapirillum, Cyanobacteria (BGA)
PSM (Phosphate Solubilizing Micro organism)
Potential demand for bio fertilizer: 3.4 lakh tonnes
(Biotech consortium, Delhi)
Azolla application
N by
25-30 %
BIOFERTILIZERS PRODUCTION STATUS IN INDIA
Year
Capacity
(‘000t)
Production
(‘000t)
Capacity
Utilization
(%)
1992-93
1993-94
1994-95
1995-96
1996-97
1997-98
1998-1999
1999-2000
2000-2001
2011-12
5.40
6.12
8.11
10.68
12.65
16.36
16.45
-
2.00
3.08
5.18
6.69
7.41
7.10
8.01
10.04
13.03
40.32
37.1
50.3
63.8
62.6
58.6
43.4
48.7
-
Biofertilizer demand in Tamil Nadu for principal crops
Crop
Area
(‘000
ha)
Recommended
dose (Kg/ha)
Quantity required in tonnes
Rice
2261
4.0
9044
Phosp
hobact
eri
975
Millets
790
2.5
1975
9044
Pulses
591
1.0
-
591
296
Cotton
228
2.5
570
570
-
Sugarcane
282
9.0
2538
2538
-
Sunflower
18
2.5
45
45
-
Groundnut
868
1.0
-
868
868
Turmeric
6
5.0
30
30
-
Tobacco
8
2.5
20
20
-
Coffee
32
10.0
320
320
-
Tea
65
10.0
650
650
-
15192
16356
1164
Total
Azospirillu
m
Rhizo
bium
Crop
% of Total use of
pesticides
% of total area
under the crop
Cotton
52-55
5
Paddy
17-18
24
Hort. Crops
13-14
3
Plantation crops
7-8
2
Other cereals, millets
and oil seeds
6-7
58
Sugarcane
2-3
2
Other crops
1-3
6
At Dharmapuri by TNAU – Horti.

Employs fertigation, bio control, bio fertilizer for quality and
pesticide residue free Ag. Produces

Flower and vegetable crops

Bio fertilizers instead of chemical fertilizers

Bio pesticides instead of chemical pesticides

Solves environmental and pollution problems

Drip irrigation for vegetable crops

The plant with a capacity of 8000 tonnes per annum is
producing chilled chickens for the market of Pune, Nasik and
Mumbai.

The chicken market in Mumbai also is valued at Rs 400
crores.

The company had a 4000 tonnes per annum capacity chicken
processing plant at Bangalore- catering to the markets in
Chennai, Bangalore, Kochi, Mangalore and Goa

The raw chicken market in the country is growing at about 10
per cent per annum while the growth rate of processed
chicken market is about 2 per cent.
 It
produces two lakh broilers per day.
 Sells
80 million birds annually out of 1200
million
 Rearing
arrangements in Karnataka, AP,
Maharastra and Kerala besides in TN produces
2.5 lakh tonnes poultry feed annually.
 In
200, it bring down its chicken rearing cost by
choosing its own grand parent breeding facility.

In India about 9500 species of medicinal plants were well
documented and a number of others not documented

At present there are some 9000 units in the country producing
ayurvedic medicines.

About 50 units operate in the large scale, 200 in the medium scale
and the rest in the small and cottage scale.

In India exports medicinal plants, their extracts and ayurvedic
medicines to the US, Germany, Russia, UK, Taiwan, the UAE, Hong
Kong and Malaysia

India continues to be ranked the world's second largest exporter of
medicinal plants after China as the trade in herbals registered around
137 percent growth in last five years.

India has 5,662 varieties of medicinal plants and of these trading
takes place in 460, while 178 are exported in huge quantities (over
100 metric tonnes per year).

The global trade of medicinal plants stands at $7,592 million in 2011,
and of these China and India's share was around $1,329 million and
$790 million respectively

India has registered a growth of 137 percent in export of medicinal
plants in global market from Rs.554 crore in 2005-06 to Rs.1,318
crore in 2010-11.

India is world’ second largest producer of silk after Chine

Share in world silk production - 17 % against 75 % of China

Mulberry silk - produced - Karnataka, West Bengal, Jammu &
Kashmir, Assam, Punjab. TN and AP.

Tasar silk is produced from silkworms that eat leaves of oak,
asan and arjan trees.

Tasar silk is mainly produced in Bihar and West Bengal.

Muga silk is produced from silk warms that eat leaves of som and
soalu trees.

It is produced only in Assam. The silk has a natural rich golden
color.

Production of wool in India - 45 million kg.

15-16 million kg is suitable for carpets.

The rest is coarse, inferior, black wools unsuitable for use
in carpet market

India does not produce apparel wool at all.

India imports 50-60 million kg wool from New Zealand,
Australia

The annual imports of raw wool amount to Rs. 700 crores
and the exports of woolen goods Rs. 2000 crores.
India ranks 10th among the top ten countries in terms of cultivable land
under organic certification.
The certified area includes 10% cultivable area with 0.50 million Hectare
and rest 90% (4.71 million Hectare) is forest and wild area for collection
of minor forest produces.
Total area under organic certification is 5.21 million Hectare (2012-13).
India produced around 1.34 million MT of certified organic products
which includes all varieties of food products namely Sugarcane,
Cotton, Basmati rice, Pulses, Tea, Spices, Coffee, Oil Seeds, Fruits and
their value added products.
Among all the states, Madhya Pradesh has covered largest area under
organic certification followed by Rajasthan and Uttar Pradesh.

India exported 135 products last year (2012-13) with the total
volume of 165262 MT including 4985 MT organic textiles.

The organic agri export realization was around 374 million
US$ including 160 US $ organic textiles registering a
4.38%growth over the previous year.

Organic products are exported to EU, US, Switzerland, Canada,
South East Asian countries and South Africa.

Oil seeds - Soybean (41%) lead among the products exported
followed by Cane Sugar (26%), Processed food products
(14%), Basmati Rice (5%), Other cereals & millets (4%), Tea
(2%), Spices (1%), Dry fruits (1%) and others.













Basmathi Rice
Cotton
Mango
Cashewnut
Sesame
Pine apple
Wheat
Wall nut
Tea
Coffee
Spices
Herbal products
Pulses

USA

Canada

Nether lands

UK

Germany

Belgium

Swiss

France, Italy and Spain

Saudi Arabia and UAE

Japan and Singapore

Australia

South Africa

National Steering Committee set up by ministry of commerce.

They developed natural standards based on international regulations
Accreditation and Certification agencies

For exports of organic products certification is mandatory

Accreditation agencies are

Agricultural and Processed food products Export Development
Authority (APEDA)

Coffee Board

Tea Board

Spices Board

Coconut Devt. Board

Directorate of Cashew and Cocoa Devt.
Recognized by accreditation agencies

ECOCERT International
(Based in France and Germany, Branch at
Aurangabad)

IMO Pvt. Ltd. – (Institute of Marketecology) (Based in Swiss, branch
at Bangalore )

INDOCERT (Based in India, office at Aluva, Kerala)

LACON. GmbH (Based in Germany, office in Aluva, Kerala)

SKAL International (Based in the Nether lands, branch office in
Mumbai)

SGS India Pvt. Ltd (Based in Swiss, office in Delhi and other cities)

Processed food industry – 175000 crores in 2005

Less than 2 % of fruits and vegetable processed

80% in Malaysia, 78% in Philippines

If 10% processing – needs 140000 crores investment

It will generate employment to 77 lakh persons

It reduce wastages by 80000 crores
Conclusion

Agri business in India offers greatest / unlimited scope in the
years to come

Especially in the following areas







Organic farming – products
Processing of fruits and vegetables
Processed food and food products
Bio technology and its applications
Corporate farming / contract farming
Floriculture
Dairy, poultry and fisheries
THANK YOU