Branding can propel India among top five farm produce exporters by 2030

India's share in the Rs 90 lakh crore world food market is just 2%

India can become one of the world’s top five exporters of farm produce and generate greater returns for its farmers apart from giving assured quality to consumers if extensive investment is made on branding of food and fresh farm products, the third Food and Agriculture Integrated Development Action Report (FAIDA) jointly prepared by Confederation of Indian Industry (CII) and McKinsey and Company said.

“In India the move towards brands has picked up vigour in the last decade and the Indian consumer’s tastes and preferences were in line with the global trends with an overwhelming 84 per cent supported branded items… which makes a strong case for a large opportunity for branding in various fresh and processed categories,” the report said.

India’s share in the Rs 90 lakh-crore world food market is just two per cent and it exported only eight per cent of the food it produced between 2006 and 2010, which rose to 12-13 per cent by 2012. Packaged food is likely to grow by 9 per cent annually to become a Rs 6 lakh-crore industry by 2030.

The report said in India the extent of branding in food items is mixed. In edible oil almost 40 per cent of the market is captured by branded products, while in flour it is 10 per cent, in rice it is 10 per cent, in dairy products it is 20 percent and it less than two per cent in sugar.

“Lack of safety standards, completely undifferentiated products and sub-scale units currently unshackle the branded food industry in India, which can be pushed up and extended to fresh food as well,” the report said.

It said, globally, examples Chiquita and Dole in banana and pineapple, Greenvale in potatoes, Foster Farms in poultry are instances were branding has been successfully extended to fresh food and vegetables. However, to expand India’s share in the world food market on the back of branding, the report highlighted some key points, which included categorising key sources of supplies based on several parameters, efficiency in procurement and minimisation of post-harvest and on-
farm losses, aggressive marketing of the brand and launching variants of the same product to help the customer see value.
 

Packaged Food Is fast Growing Industry with Huge Potential for Branding
NOTE: All Figures Are In $Million
Foor Items	World Market Size
	2010	2030
Milk	7,767	32,900
Cheese	144	1,958
Butter	254	1,340
Edible oils	3,931	10,331
Sweet & Savoury Snacks	1,286	16,399
Atta	574	8,158
Processed Poultry	398	8,340
Fruit Beverages	720	12,204
Biscuits	2,753	13,145
Source: Third Food and Agriculture Integrated Development Action Report (FAIDA)

Branding campaigns like the ‘Incredible India’ campaign could be undertaken to showcase India’s food diversity as well and thereby the corresponding potential of the market, the report said.

“Branding will help consumers see the difference between the same product, which does not happen now, hence he declines to pay a premium for branded items,” said Adil Zainulbhai, chairman-India of McKinsey and Company.

The report also advocated launching a ‘National Agriculture and Food Export Mission’ in select categories by the government targeted at select products in identified markets.