FNB News - “Food industry in India growing faster than world”

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INTERVIEW

“Food industry in India growing faster than world”

Monday, 25 April, 2016, 08 : 00 AM [IST]

Cargill, a manufacturer of food and agriculture products, recently inaugurated a state-of-the-art wet corn milling plant in Davangere, Karnataka. The US$100 million investment is spread over 44.5 acre of land and has a capacity to mill 800 tonne of corn daily. At the mill, corn is being processed to produce glucose and other derivatives which can be used as thickeners, sweeteners and for other purposes in the food and healthcare industries. While the output from the new mill will be largely used for the local market, it will also serve customers in South East Asian and African markets.

Jan Bosman is MD, starches and sweeteners, Cargill Foods India, Bangalore, a division of Cargill India. In this role, he is responsible for driving profitable growth across consumer and customer segments, business development and leading the company’s starches and sweeteners business to profitable growth. In an email interaction with Ashwani Maindola, Bosman describes the business and opportunities in the sector and the movement in the food processing sector in the country. Excerpts:

Describe the operations at the Wet Corn Milling plant. How do you think this unit will change the landscape of the food processing industry in India?
We have expanded our operations in the state of Karnataka through a US$100 million investment in a wet corn milling plant in the district of Davangere. The plant is spread over 44.5 acre of land and has a capacity to mill 800 tonne of corn daily. The plant does three types of operations, namely milling, refining and drying to produce various value-added products.

It will cater to the growing demand in the food and pharmaceutical sectors locally as well as internationally, largely in South East Asia and Africa. The plant will also cater to the animal feed industry by providing high quality corn-based feed ingredients.

The food processing industry is going to benefit immensely from Cargill’s global expertise in starches and sweeteners business backed by manufacturing and quality management best practices which will ensure consistent and high quality product offerings. Besides, with the latest technology deployment, we will be able to offer a complete range of glucose syrups, high maltose syrups, dextrose syrups, and maltodextrin powders to our customers.

Given Cargill’s presence across the supply chain and with over 150 years of experience in sourcing of grains, our customers can be sure of getting the entire range of value-added products made from the finest quality corn.

What are the industrial trends in starches and sweeteners industry? What is the demand and scope of business in India?
The food and pharma industries in India are growing at a faster pace than the rest of the world. India’s food processing sector ranks fifth globally in terms of exports, production and consumption. The sector amounted to US$13.2 billion in FY2012-13, accounting for 9.8 per cent of the GDP. According to industry sources, the sector is expected to grow at a rate of 8-10% until 2018, driven by consumer demand for packaged and ready-to-eat food. With the food and food processing industry growing, we foresee the demand for the starches and sweeteners rising in the coming years.

How are you planning to reach the target markets of the mill produce? Describe your marketing efforts. Throw light on B-B reach of the mill produce.
Our customers can be segmented into three categories – multinational companies, big Indian companies and the players in the unorganised market which account for almost half of India’s food industry landscape. Our MNC customers will be reached through our global relationships. We already have an existing relationship with large Indian majors who will be followed by our dedicated marketing team. The mid and small companies operating in the unorganised market will benefit from our extensive distribution network as well as a strong marketing team.

How have been the past for your business and what are the future plans for 2016 and beyond?
The production at the plant will be in a phased manner. The first production line started in December last year, the second production line started in February this year and the third production line will commence from May this year. We are working towards occupying a sizeable share in the market by providing the best in class and consistent quality products to our customers.

What can the bakery and confectionery industries expect from your operations?
The industry segments which will benefit from this facility are confectionery, dairy, bakery, infant formula, beverages, and nutraceuticals. In addition, this facility will also bring innovative products for the Indian animal feed industry.
The processes of this project are designed to meet the stringent quality & food safety requirements which will be in line with Cargill’s global quality standards, to ensure our customers get highest quality of glucose syrups & maltodextrin powders consistently.

The advanced technology & environment-friendly operations such as ensuring the absence of pollutants by focussing on zero wastewater discharge, treating and recycling wastewater within the factory will set new global standards in responsible and sustainable production of sweetener products.

To manage the supply chain for our wet corn milling facility at Davangere, Cargill is also making inroads into bulk storage in India and we are setting up our first bulk storage facility of 60,000 metric tonne in Davangere, Karnataka.The bulk storage will help secure corn supply and manage the corn quality during storage in order to ensure year round production of the plant.