Himalaya keen on direct herb purchase

Himalaya Herbal Healthcare, Indian drug major, was planning to take proportion of direct procurement of herbs from farmers to 50 per cent of its net procurement in three year's time from 32 per cent now as a part of augmenting its social responsibility drive.

Himalaya had started sourcing from rural farmers through non-governmental organisations(NGOs) about four years back, starting with the southern states of Andhra Pradesh, Tamil Nadu, Karnataka among others.

It sources neem leaves from smaller farmers (land size of less than an acre) in Andhra Pradesh for its Bangalore facility through Gram Mooligai Company limited(GMCL).

Himalaya requires around 10-15 ton of neem leaves per month, and sources it primarily from Andhra Pradesh, said Saket Gore, business head,consumer products division, Himalaya.

"We try to source as much from these farmers directly, while we get the rest from the open market", Gore added.

The company decided to take this up as a social initiative, and sourced around 15 ton of turmeric last year from tribal farmers in Orissa.

After the turmeric prices crashed in the open market middle of last year, it decided to source the herb from 90 odd families through a Delhi-based NGO, International Development Enterprise of India (IDEI), said Gore.

"These are essentially small farmers with average land size of 0.2 acres. We would urge the NGOs we work with to identify smaller farmers as they are usually the worst affected by price fluctuations", he added.

Himalaya used around 50t of turmeric annually and was keen on sourcing it entirely from Orissa.

The company, on an average, pays 25 per cent more than the market price to these farmers and would take periodical feedbacks from its partner NGOs on the price that these farmers get from the open market, claimed Gore.

It is in the process of identifying more such rural pockets in the country for future sourcing.

Currently, around 15,000 farmers across the country work with Himalaya.

This apart, there are more than 100 farmer families near their Bangalore facility who work exclusively for the company.

Besides training and offering prices higher than the open market, Himalaya offers them margins on their investment. Farming families in the foothills of Uttaranchal would grow some seasonal herbs exclusively for Himalaya.

Herbs sourced through contract farming include Tulsi, Bringhraj,Alfalfa, Musta, Mavanellai, Lucerne,Santhijad, apart from Neem and turmeric.

The company did not agree to give out figures of total volume procured and the net amount spent on contract farming last year, or the returns.