|
|
|
You can get e-magazine links on WhatsApp. Click here
|
|
|
|
|
Feature
Bakery ingredients: Present status, challenges; future prospects
|
|
Thursday, 08 December, 2011, 08 : 00 AM [IST]
|
|
Pankaj Kumar Jha
|
 The bakery sector is one of the fastest growing sectors in India with the unorganised segment cornering a 65% share of the bakery pie.
Ingredients for bakery products
There are two types of ingredients, according to their percentage in recipe:
a) Major ingredients: These provide bulk to the product, overall structure, body etc. and consist mainly of wheat flour (heart of each recipe in bakery), sugar, fat, salt, water, egg (optional), SMP, soya flour, and starch.
b) Minor ingredients: These are functional ingredients generally added to improve the physical and sensory attributes of the bakery products. It also helps to overcome seasonal variations, process variations, to give similar quality product each time and to reduce the processing time. Broad categories are enzymes, emulsifiers & stabilisers, preservatives, chemical improvers, nutritional ingredients (vitamins, minerals, fibres, sweeteners), flavours, etc.
Bakery industry and consumer trends
World bakery market
Today, the world bakery market is estimated to be worth US$407 billion. It has grown at a CAGR of 3.93% over the last decade. Asia-Pacific is the fastest-growing region with a CAGR of 6.93%. With the increased emphasis on snack foods, there has been a steady rise in single-serve portions. This trend is evident in baked goods such as bread, rolls, pastries and doughnuts, which have seen a growth of 3-4% per annum. Another trend worth mentioning is the growing industrialisation in the world bakery market, with developed countries, barring European countries, seeing a steady swing away from artisan bakers and towards more wrapped and specialty products in the categories like breads, cakes and biscuits, which have now become an important fixture in modern retail outlets.
Another trend, which is making waves in the advanced US market, is a growing preference for products providing health, convenience and indulgence. Most of the innovations were focussed upon the development of healthy or functional variants such as natural, functional, light or low carb, fat-free, sugar-free and organic bakery products.
Indian bakery market
In India, there are 85,000 bakery units, of which 75,000 operate in the unorganised sector occupying 65% of the market share. The Indian bakery market is valued at Rs 3,295 crore for 2008 and is expected to reach Rs 4,308 crore by 2012. The per capita consumption of bakery products as it stands today is 1-2 kg per annum, which compares very low with that in the advanced countries - 10-50 kg per annum. The urban areas hog a major share of the Indian bakery, comprising 77.5 % of the total market.
The Indian bakery market is estimated to be worth Rs 6,900 crore, growing at a healthy CAGR of 7% per annum. Out of this, bread and biscuits hold about 82% of the share. The major players in these segments are Britannia, Parle, Bakeman, ITC Foods Ltd, Surya Food and Agro Pvt. Ltd, GSKCH and HUL and the major brands are Britannia, Parle, Bakeman, Priya Gold, Elite, Cremica, Dukes, Anupam, Monginis and Horlicks.
Key trends
Major trends in the Indian market are more or less similar to the world market. Some of the major consumer trends in the Indian bakery market worth mentioning are
• With globalisation and cultural integration, eating habits of the discerning urban and rural consumer are fast changing. Changing consumerism is witnessing product innovations and retail formats are going to be great platforms for product push in the near future.
• Bakery joints are slowly becoming popular hangout places. A typical trend is for a variety of bakery snacks, top quality products and value for money.
• The focus is now going to be on speed and versatility while addressing consumer demands.
• Consumers are increasingly concerned about their health and are well aware of the relationship between nutritious food and optimal health. Some popular trends in the market are the introduction of low / light, functional, natural and organic products.
• In addition to healthier products, consumers also are purchasing products that satisfy their taste-buds. On-site manufacturing of bakery products in bakeries and supermarkets directly contributes to this trend, as it is well known that the smell of freshly baked breads and other products is a strong motivational factor in subsequent purchases.
Exports
Mainly emulsifiers, preservatives, and Guar gum are exported. The major manufacturers in India are Fine Organics, Spell Foods, Spell Organics, Lucid, and Kemin. The export market comprises south-east Asian countries (Thailand, Philippines, Taiwan, and Malaysia), neighbouring countries (Nepal, Bangladesh, Sri Lanka, and Pakistan), USA, and African countries (Brazil, Chile, and Peru).
Apart from ingredients, bakery products (biscuits & cakes) are majorly being exported to Arab countries. Local manufacturers who exports bakery items are Cremica, Bonn and Kiddy’s.
Imports
In India, food ingredients and raw materials to manufacture these ingredients are being imported from countries like China, France, Germany, USA, Brazil, Taiwan, Italy, Turkey, Chile, and the Netherlands. The quality and price are the two major factors favouring import of these ingredients. Major MNCs importing ingredients are FSL, FDL, Danisco, Novozyme, Dowwolf, Roquette, DSM, CP Kelco, and the list is growing year by year.
Procuring raw materials
The ingredients are sold either directly to bigger customers or through distribution and sales network for local players and smaller bakeries. The ingredients are either individually sold (industrial customers) or sold as proper solution in mixes (for smaller enterprises).
Restrictions and regulations
The import and export of food ingredients in India is governed by Directorate General of Foreign Trade (DGFT) under Ministry of Commerce. The taxes and duties are imposed by Central Board of Excise and Customs, under Ministry of Finance. According to Central Excise and Customs Law, each food ingredient is classified (for duties / taxes purpose) under different chapters according to their source, processing and nature. The other body keeping an eye on the quality of incoming ingredients is Food Safety and Standards Authority of India (FSSAI), under Ministry of Health and Family Welfare. Although food ingredients are properly classified and listed in this Act, the quality parameters and analysis techniques are still not clear, which sometimes creates trouble in importing and exporting of these ingredients.
Challenges & prospects
Unorganised sector: Local manufacturers with numerous local brands cater to the populous segment and contribute considerably to the bakery industry. Low margins, high level of fragmentation are the main features in the bakery industry. Volumes, brand loyalty and strong distribution networks are the main drivers of growth.
Organised sector: The sector is facing problems due to low margins of profit due to escalating prices of major raw materials, particularly wheat flour, vegetable oil, sugar, and milk. But still the future of bakery industry in India is bright, as 70-80% of the market is still being served by the unorganised segments of the market.
Tax benefits and issues
No such tax benef
|
|
|
|
|
|
|
|
|
|