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Covid-19 – Industry suffers huge losses, impact assessment only by June
Tuesday, 24 March, 2020, 08 : 00 AM [IST]
Ranjana Sharma and Vijetha Iyer, Mumbai
The Covid-19 pandemic has caused much stress in major world economies including India and the food sector is also expected to witness some stress in coming weeks. The industry however, is putting up a brave front and industry insiders say that with government’s support the production can remain unhurt. 

In this regard, industry experts have written to MoFPI that no food product should be restricted from manufacturing, stocking and distribution. Even industry chambers have asked their members to continue production but with utmost care and sensitise their workers in safety and hygiene. 

Further, the industry has made a demand that the workforce should be exempted from restrictions put out in various parts of the country due following the March 22 ‘Janta Curfew’. 

However, there has been a sizeable loss registered by the industry and a full impact assessment will be possible only by June this year. 

Sagar Kurade, CMD, Suman Food Consultants, said, “The demand is affecting with regards to essential goods. The operational channels from which the products are getting sold are few. Hence, the industry has got affected and it will be affected till the time they have a stable scenario with regards to health & safety of the consumers. The production has not been stopped. In the affected district, where there is a shutdown, the production has affected immensely.”

“It is requested from Government of India and Ministry of Food Processing Industries to ensure that some kind of relief package is offered to the food processing industry especially to those in the MSME sector with regards to financial incentives or with regards to loan, tax related benefits, etc. We expect that at least this quarter will be affected and the impact will be there till the next quarter,” he added.

Meanwhile, Joshna Joseph, quality assurance manager, Candor Foods Pvt. Ltd, explained the losses: “There has been a lot of loss to the food industries due to the spread of pandemic Covid-19. Losses due to lack of transport of the products and lot of pressure in the transport facilities are the major problems being faced by the companies. The lockdown in many cities has led to people hoarding of food products leading to more demand and less supplies. Covid-19 doesn’t spread via food as it requires humans or animals as host to spread.” 

She also added, “In this hour of distress, food business operators must take care of the products that are packed and personal hygiene of the people working to avoid spread and contamination of the virus.”  

The losses are more when the production is stopped. Ashish Dang, founder, The Date House, said, “Yes, we have stopped production and for the safety purpose of our employees, we have given them paid leave. Also, we have a certain surplus of products ready with us for the near future. Modern trade with the closures of malls already has taken a hit and no major revenue is expected till April 30, ‘20, and may stretch up to June ’20. Online trade will definitely be a saviour this season but with the conditions that the logistics partners need to have developed foolproof SOPs to have zero virus transmission.

He added,” We are seeing a surge in online orders though not comparable with the modern trade sales. Demand will pick up exponentially in grocery retailing & essentials, and revenue will keep on raising up till next 2 months for these sectors might see the projections in the range of 400-500% north; after that, we may have concern from supply side, as logistics & production will start taking the hit in the agricultural production as well as food processing units. Luxury food, gifting & fine dining will take a severe hit, for the next 5-6 months where we are expecting 2020 turnovers to be around 20-25% of the 2019 turnover.  Lockdown in major trade centre of India has affected the distribution of our products. Being in the perishable industry, the products in the circulation have to be written off. The chain has been disrupted and the distribution network has already been affected.”

Issues in the wake of a virus outbreak being faced by ASSOCHAM Food processing council members said, “We had to stop production for a while due to lockdown. We cannot overproduce as shelf life of the product is less and procuring raw material is also difficult. We are facing problems in distributing the produced stock to the shops. Labours/ Employees are not able to reach the plant due to lockdown. Decline in the sales/ demand due to lockdown and people tend to avoid food from outside.”

Tahir Sufi, Graphic Era Deemed to be University, Department of Hospitality Management, Dehradun said, “The food-handling part has stopped completely in most cases considering the potential threat to the business. The demand for the processed food is at minimum as people prefer to consume fresh foods- especially vegetarian items. The prices of meat products have reduced considerably due to fall in demand.  Apart from financial losses, food industry is facing job losses as well due to the decline in demand.”

He added, “The main problems faced during outbreak are: We had to stop production for a while due to lockdown. We cannot overproduce as shelf life of the product is less and procuring raw material is also difficult. We are facing problems in distributing the produced stock to the shops. Labours/ Employees are not able to reach the plant due to lockdown. Decline in the sales/ demand due to lockdown and people tend to avoid food from outside.”

Bhushan Yengade, Food Industry Consultant, Binder Technology Consultancy said, “We are into Food processing Project Management Consultation and Marketing Research advisory services, so Project management dialogues are on hold for short term. Travelling is restricted in the pandemic crises so we need to take precautions and learn from gravely affected COVID 19 regions for thriving economy.”

While talking about the import/ export he added, “The import and export market has been tracing mixed reactions. The MSME, SME and start up food industries survive on thin margins so government needs to declare economic package to accelerate the growth. Food supply chain has a broad range of work force, from food technologists to workers. The workers who work on daily wages are tending towards unemployment.  Food processing industry caters the need of Hospitality industry. The major breakdown in the hospitality industry is making enormous impact. Also, the fake news on meat, egg and fish industry is creating another storm. The future of globalisation is being questioned till the travelling sanctions.”  
 
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