- The production levels in the Indian agricultural sector have been growing steadily over the years. This production level has not been met correspondingly in terms of storage for food, which outlines an existing whitespace in the Indian Agricultural Cold Storage Industry.
- Despite being an agrarian state, India suffers from huge food losses annually ranging from INR 90,000-100,000 due to poor post-harvest management and lack of proper cold storage infrastructure.
- The government has been taking steps to promote development in the agricultural cold storage sector by introducing a plethora of schemes and providing grant in aid, along with special preference to the states lagging behind in terms of infrastructure.
It is no wonder that India is a
key contributor to agriculture sector worldwide with 308.6 Mn Tonnes food-grain
production during FY’21 (ranks second after China), 198.4 Mn Tonnes of Milk in
FY’20 (world’s largest milk producer) and dominant producer of horticulture
produce as well. After all, India has an arable land of ~160 Mn hectares and
58% of population is dependent on agriculture for its livelihood.
However, the situation on per
capita consumption of food grains, fruits, vegetables and milk is not good. As
per the Global Hunger Index (GHI) in 2020, India ranked 94 out of 107 countries
and malnutrition was found to be the leading risk factor for death of children
<5 years age. Further, prevalence of Anaemia was noted to be among 53% women
of all reproductive age and 54% among girls aged 15-19 years. What is the
root-cause problem behind this irony?
India
Agricultural Cold Storage Market Future Outlook
Upon a deep dive research and
data analysis, analysts at Ken Research were able to find that poor
post-harvest management policies of agriculture, especially Horticulture, is a
key contributor to this grim situation. An estimate shows that India incurs an
annual loss of INR 90,000-100,000 crores every year in wastage of
agricultural and horticulture produce owing to poor post-harvest management
policies. Further, 35-50% of such economic loss happens due to lack of
required cold chain infrastructure at farm-gate and hub level.
Before ready for final
consumption, produce of fruits and vegetables produce is harvested, pre-cooled,
sorted, graded into different categories and stored in cold storage rooms for
specified duration. Cold Storage facilities do not allow bacteria formation,
retains humidity and moisture; thereby increasing the shelf life of produce
while retaining the nutritious value. A study conducted by NCCD and NABCON in
2015 highlighted the differences in the requirement of cold chain
infrastructure and actual availability of infrastructure. The key findings are
summarized below in the table:
But, how is
the situation in 2021?
Although the cumulative cold
storage capacity has augmented in the past decade from 23.4 Mn MT in 2010 to
37.4 Mn MT in 2020 (surpassing the requirement of 35 Mn MT in 2015), a further
deep dive tells us the disproportionate growth and inefficiencies at the grass
root level. More than 75% of the cold storage capacity is concentrated among
the top 5 states (UP, West Bengal, Gujarat, Punjab and Andhra Pradesh) while
73% of total capacity is suitable for storing single commodity only. 68% of
cold storage capacity across India is suitable for storing Potato only
(foregoing economic benefits of storing milk, livestock and other high value
crops) and 92% of such units are being operated by private players,
characterizing an unorganized and fragmented industry unwilling to undertake
capacity expansion or invest in modernization of facilities.
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Is there an
opportunity to enter this industry and solve the problem?
With high growth expected in food
and diary processing industries, rising urbanization, shift in cropping
patterns from agriculture to horticulture, surging demand for nutraceutical
products, maturing ecosystem with new age Agri-tech startups and increase
interest from PE/VC fraternity, analysts at Ken Research believe that
agricultural cold chain industry is poised for strong growth with an estimated
capacity addition of 6.5 Mn MT by 2025.
Are there
any incentives provided by government to promote the industry?
There are plethora of schemes and
benefits implemented by union and state governments to seek participation from
private players and augment cold chain infrastructure in India. The PM Kisan
SAMPADA (Scheme for Agro-Marine Processing and Development of Agro-Processing
Centers) Yojana, approved by Cabinet in May 2017, provides financial assistance
in the form of grant-in-aid at the rate 35% for general areas and 50%
for North East States, Himalayan States, ITDP areas and Islands for storage and
transport infrastructure and at the rate of 50% and 75% respectively for value
addition and processing infrastructure subject to a max of Rs.10 crore per
project for setting up integrated Cold Chain projects in India. Through the
Mission for Integrated Development of Horticulture (MIDH), financial assistance
is provided to set up cold storages for various horticulture - fruits,
vegetables, root & tuber crops, mushrooms, spices, flowers, aromatic
plants, coconut, cashew, cocoa and bamboo. As on 31st January 2021,
a total of 325 cold storage projects (214 completed and 111 on-going)
are operational across India with a total project outlay of INR 8,893 crores
while the GoI has approved a cumulative grant–in aid of INR 2,478 crores via
its various schemes under MOFPI & NHB. With support from government, strong
tailwinds from end-users and favorable economic conditions, cold storage units
could help to solve hunger crisis and ensure a protein, iron and nutrient rich
diet accessible to 1.4 Bn Indians.
Key Topics
Covered in the Report: -
·
India
Agricultural Cold Storage Market Major Players
·
Snapshot of
Agriculture in India (State wise Production statistics of Cereals,
Horticulture, Meat, Livestock and Poultry)
·
Situation of
Farmers in India (Profile of Farmer, Role in Value Chain, Problems and Issues
faced in storage of produce)
·
Overview and
Segmentation of Cold Storage Units (By Storage Temperature, Technology,
Regional & State wise Distribution)
·
Demand side
and Supply side Indicators of Cold Storage Solutions
·
Growth
Drivers and Challenges to growth of Cold Storage Industry
·
Cold Storage
Demand-Supply Profile of Key States – Uttar Pradesh, West Bengal, Gujarat,
Punjab and Andhra Pradesh, Maharashtra, J&K and Himachal Pradesh
·
Trends and
Developments
·
Union and
State Government Support to Cold Storage Sector
·
Impact of
COVID-19 and Future Outlook of Industry
·
Business
Attractiveness at Farm gate level
·
Recommendations
for operatiqng Sustainable Business
For More
Information, refer to below link: -
India
Agricultural Cold Storage Industry Research Report
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Ken Research
Ankur Gupta, Head Marketing &
Communications
+91-9015378249
