The low level processing capacity of food products such as fruits and vegetables, dairy products, meat, poultry, marine products and complex as well as inefficient supply chain is leading to huge wastages, consultancy firm Technopak Advisors has said.
In case of potato, the wastage is as high as 21%, which is due to insufficient supply chain infrastructure. In case of apple, the wastage is more than 23%, the Technopak has said.
However with the organized retail boon and investment in the supply chain management, India will catch up with other countries such as China, Poland, Brazil, Thailand and United States over the next 10 years in organized retailing, the consultancy firm said in a paper titled ‘India: potentially the next food basket for the world’.
It said that it took about five decades for US to have more than 85% of the market under organised retains, while China took more than 10 years to have 20% market under organised retains. “Within next five years 16% markets will be under organised retails,” Haminder Sahni, managing director, Technopack Advisors, said.
The paper said that only 1.7% of fruits and vegetables produced are processed in the country. But in case of dairy products more than 37% of the produce is processed. Even 21% meat products are processed.
However with the domestic players entering retain market in a big way, there has been a major investments in areas such as contract farming, corporate farming, food parks, cold chains, cold storage and warehousing and food processing, the Technopak paper has said.
“The processes food which constitute about 17% of the retail market would increase its share to more than 50% by 2011, while apparel which currently has more than 53% of retail market would reduce its share to 27% by 2011,” the paper said.
It said that food and grocery market enjoyed the biggest share across retail categories accounting for 62% of urban consumers spending and 73% of rural consumer spending.
“Considerable opportunities exist in wet groceries like fruits, vegetables, meat products etc where organized retails have not yet capitalized on the large consumer spend,” Sahni has said.