Agro Food Processing: Forming village clusters and establishing Food Storage

Agro Food Processing: Forming village clusters and establishing Food Storage,

Food Processing Industry is of enormous significance for India’s development because of the vital linkages and synergies that it promotes between the two pillars of the economy, namely Industry and agriculture. India is world’s second largest producer of food and has the potential to become number one in due course of time with sustained efforts.
The Growth potential of this sector is enormous and it is expected that the food production will double in the next 10 years and the consumption of value added food products will grow at a fast pace.
This growth of the Food Processing Industry will bring immense benefits to the economy, raising agricultural yields, meeting productivity, creating EMPLOYMENT and raising the standard of very large number of people throughout the country, specially, in the rural areas.
Economic Liberalization-2/”>Liberalization and rising consumer prosperity is opening up new opportunities for diversification in Food Processing Sector.
Liberalization of world trade will open up new vistas for growth.
The Food Processing Industry has been identified as a thrust area for development. This industry is included in the priority lending sector.
Most of the Food processing Industries have been exempted from the provisions of industrial licensing under Industries (Development and Regulation) Act, 1951 with the exception of beer and alcoholic drinks and items reserved for Small Scale Sector, like vinegar, bread, bakery.
As far as foreign Investment is concerned automatic approval for even 100% Equity is available for majority of the processed food items.

FOOD PROCESSING POTENTIAL IN INDIA

2nd largest arable land in the world -India has the tenth-largest arable land Resources in the world with 161 million tonnes. With 20 agri-climatic regions, all 15 major climates in the world exist in India. The country also possesses 46 of the 60 Soil-types/”>Soil Types in the world
Largest producer of milk -India is the largest producer of milk and second – largest producer of fruits and vegetables
Largest Livestock Population–India has the largest livestock population of around 512 million, globally. This comprises 119 million milch (in-milk and dry) animals, 80.06 million goats and 44.56 million sheep, as of FY15. The segment contributes about 25 per cent to the country’s farm GDP
Rising consumption expenditure-Consumer spending in 2015 was USD1 trillion; it is likely to reach USD3.6 trillion by 2020 Source: World Travel and Tourism Council, Directorate of Statistics, TechSci Research Note: GDP – Gross Domestic Product FOOD PROCESSING
Favourable location for exports –Strategic geographic location and proximity to food importing nations favour India in terms of exporting processed foods

FOOD PROCESSING- ADVANTAGE IN INDIA

Strong demand growth

Demand for processed food rising with growing disposable income, Urbanisation, young population and nuclear families
Household consumption set to double by 2020
Changing lifestyle and increasing expenditure on Health and nutritional foods

Food processing hub

India benefits from a large agriculture sector, abundant livestock, and cost competitiveness
Investment opportunities to arise in agriculture, food Infrastructure-2/”>INFRASTRUCTURE, and Contract Farming
Diverse agro-climatic conditions encourage cultivation of different crops

Increasing investments

Government expects USD21.9 billion of investments in food processing infrastructure by 2015
Investments, including FDI, would rise with strengthening demand and supply fundamentals
Launch of Infrastructure Development schemes to increase investments in food processing infrastructure

Policy support

Sops to private sector participation; 100 per cent FDI under automatic route. Investment in April 2000- March 2016 stood at USD6.82 billion
Promoting rationalisation of tariff and duties relating to food processing sector
Setting up of National Mission on Food Processing
Foreign Trade Policy 2015-2020

THE FOOD PROCESSING SECTOR COMPRISES SIX MAJOR SEGMENTS

Fruits and vegetables –

India is the world’s 2^nd largest producer of fruits and vegetables. The government expects the processing in this sector to grow by 25 per cent of the total produce by 2025.
In 2015-2016, the total production in Horticulture-2/”>Horticulture sector (fruits and vegetables) is estimated at 282.5 million tonnes.

Milk

India is the largest producer of milk in the world, with the production estimated at 146.3 million tonnes in FY15 India is the largest producer of buffalo meat (1.4 MT in 2015) and the second largest producer of goat meat (0.91 MT in 2015).

Meat and Poultry

India is also the second largest egg producer (78.4 billion) and third largest producer of broiler meat (4.2 million tonnes in 2016), globally

Marine products

Total fish production in India is estimated at 13.0 MT during 2015-16.
Andhra Pradesh stood as the largest producer of fish with production of 741.3 Thousand Tonnes during 2015-2016 (upto June 2015)

Grain processing

India produces more than 200 million tonnes of different food grains every year.
Total food grains production reached 270.10 MT in FY16 (As per Ministry of Agriculture)

Consumer food

Among the fastest growing segments in India; it includes – Packaged food, Aerated soft drinks, Packaged drinking water, Alcoholic beverages

What need to be done to develop Food Processing Industries?

Major thing that Strongly Required to Develop Food Processing Sector

To create an appropriate Environment for entrepreneurs to set up Food Processing Industries through:
Fiscal initiatives/interventions like rationalization of tax structure on fresh foods as well as processed foods and machinery used for the production of processed foods.
Harmonization & SIMPLIFICATION of food laws by an appropriate enactment to cover all provisions relating to food products so that the existing system of multiple laws is replaced and also covering issues concerning standards Nutrition, Merit goods, futures Marketing, equalisation fund etc.
A concerted promotion campaign to create market for processed foods by providing financial assistance to Industry Associations, NGOs/Cooperatives, Private Sector Units, State Government Organization for undertaking generic market promotion.
Efforts to expand the availability of the right kind and quality of raw material round the year by increasing production, improving productivity
Strengthening of Database and market intelligence system through studies and surveys to be conducted in various States to enable planned investment in the appropriate sector matching with the availability of raw material and marketability of processed products
Strengthening extension Services and to the farmers and cooperatives in the areas of post harvest management of agroproduce to encourage creation of pre-processing facilities near the farms like washing, fumigation, packaging etc.
Efforts to encourage setting up of agro-processing facilities as close to the area of production as possible to avoid wastage and reduce transportation cost.
Promotion of investments, both foreign and domestic.
Simplification of documentation and procedures under Taxation laws to avoid unnecessary harassment arising out of mere technicalities.

INFRASTRUCTURAL DEVELOPMENT TO DEVELOP FOOD PROCESSING DEVELOPMENT

Establishment of cold chain, low cost pre-cooling facilities near farms, cold stores and grading, sorting, packing facilities to reduce wastage, improve quality and shelf life of products.
Application of Biotechnology, remote sensing technology, energy saving technologies and technologies for environmental protection.
Building up a strong infrastructural base for production of value added products with special emphasis on food safety and quality matching international standards.
Development of Packaging Technologies for individual products, especially cut-fruits & vegetables, so as to increase their shelf life and improve consumer acceptance both in the domestic and international markets
Development of new technologies in Food Processing & Packaging and also to provide for the mechanism to facilitate quick transfer of technologies to field through a net work of R&D Institutions having a Central Institute at the national level with satellite institutions located strategically in various regions to cover up the whole Country and to make available the required testing facilities. This could be done by establishing a new institution or strengthening an existing one.
Development of area-specific Agro Food Parks dedicated to processing of the predominant produce of the area e.g., apple in J&K, pineapple in North East, Lichi in Bihar, Mango in Maharashtra & Andhra Pradesh etc. etc
Development of Anchor Industrial Centre and/or linkage with Anchor Industrial Units having net work of small processing units. h. Development of Agro-industrial multi-products units capable of processing a cluster of trans-seasonal produces.

BACKWARD LINKAGE TO DEVELOP FOOD PROCESSING DEVELOPMENT

Establishment of a sustained and lasting linkage between the farmers and the processors based on mutual trust and benefits by utilizing the existing infrastructure of cooperative, village panchayats and such other institutions
Development of Futures Market in the best interest of both the farmers and the processors ensuring a minimum price stability to the farmer and a sustained supply of raw material to the processor.
Mechanism to reduce the gap between the farm gate price of agroproduce and the final price paid by the consumer
Setting up of an Equalisation Fund to ensure sustained supply of raw material at a particular price level and at the same time to plough back the Savings occurring in the eventuality of lower price to make the Fund self-regenerative

FORWARD LINKAGE TO DEVELOP FOOD PROCESSING DEVELOPMENT

Establishment of a strong linkage between the processor and the market to effect cost economies by elimination of avoidable intermediaries.
Establishment of marketing Network with an apex body to ensure proper marketing of processed products.
Development of marketing capabilities both with regard to infrastructure and quality in order to promote competitive capabilities to face not only the WTO challenge but to undertake exports in a big way

Operational Guidelines for the Scheme for Creation of Infrastructure for Agro-processing Clusters

The Ministry has formulated the Scheme for Creation of Infrastructure for Agro Processing Clusters as a sub-scheme of Central Sector Scheme – “Kisan SAMPADA Yojana” coterminous with the 14th Finance Commission cycle.
The scheme aims at development of modern infrastructure to encourage entrepreneurs to set up food processing units based on cluster approach.
The scheme is to be implemented in area of horticulture / agriculture production identified through a mapping exercise.
These clusters will help in reducing the wastage of the surplus produce and add value to the horticultural / agricultural produce which will result in increase of income of the farmers and create employment at the local level.

Objectives of the Scheme

The major objectives of the scheme are:

To create modern infrastructure for food processing closer to production areas.
To provide integrated and complete preservation infrastructure facilities from the farm gate to the consumer.
To create effective backward and forward linkages by linking groups of producers / farmers to the processors and markets through well-equipped supply chain.

Salient Features of the Scheme

At least 5 food processing units with an aggregate investment of minimum Rs. 25 crore will be set up in the Agro-processing cluster. These units may be setup by the promoters and associates of Project Execution Agency (PEA) and by other entrepreneurs. The investment in these units will not be eligible under this scheme.
Food processing units will be set up simultaneous to the creation of core infrastructure in the cluster. The core infrastructure facilities being developed in the agro-cluster shall be as per the requirement of food processing units to be set up in the cluster or as per the available raw material for processing in the area.
Agro-processing clusters may be developed by:
the promoter(s) willing to set up own units in the cluster and also allow
utilization of common infrastructure to other units in the area; the promoter(s) willing to develop common infrastructure for use by the units
to be set up in the food processing cluster by other entrepreneurs; the promoter(s) willing to develop common infrastructure in the existing food
processing clusters However, lead promoter shall setup at least one food processing units in the cluster with an investment of not less than Rs. 5 crore.
The extent of land required for establishing the agro-processing cluster would depend upon the business plan of Project Execution Agency (PEA), which may vary from project to project. At least 10 acres of land for the project shall be arranged by the PEA either by purchase or on lease of at least 50 years. The GOI grant shall not be used for procurement / purchase of land.
Preference will be given to setting up agro-clusters in agri-horti clusters identified by Central / State Governments, if any.
It is expected that on an Average, each project may have around 5-10 food processing units to be set up in each Agro-processing cluster with an employment generation potential, both direct and indirect of about 500 to 1500 persons. This employment generation will provide livelihood to about 6000 persons based on an average household size of 4 members. However, the actual configuration of the project may vary depending upon the business plan for each Agro –processing cluster.
The food processing industries that make food products fit for human and animal consumption (except alcoholic products ) may be permitted to be set up in these clusters. Packaging facilities of food products as ancillary to the food processing industries (proposed to be setup in the cluster) may also be allotted land in the agro cluster.

Agro Food Processing is the process of converting raw agricultural products into food products that are ready for consumption. This can involve a variety of activities, such as harvesting, sorting, cleaning, grading, packaging, and storing food.

There are many different types of agro food processing, depending on the type of raw agricultural product being processed and the desired end product. Some common types of agro food processing include:

Fruit and vegetable processing
Meat processing
Dairy processing
Grain processing
Fish processing

There are many benefits to agro food processing. Some of the benefits include:

Increased food safety: Agro food processing can help to improve food safety by reducing the risk of contamination. This is done through a variety of methods, such as washing, sorting, and cooking food.
Increased shelf life: Agro food processing can help to increase the shelf life of food by preventing spoilage. This is done through a variety of methods, such as canning, freezing, and drying food.
Increased nutritional value: Agro food processing can help to increase the nutritional value of food by removing harmful substances or adding nutrients. This is done through a variety of methods, such as fortification, enrichment, and supplementation.
Reduced waste: Agro food processing can help to reduce waste by converting food that would otherwise be discarded into usable products. This is done through a variety of methods, such as composting, Anaerobic Digestion, and animal feed production.
Increased income for farmers: Agro food processing can help to increase income for farmers by providing them with a higher price for their products. This is because processed foods are often more valuable than raw agricultural products.
Increased employment opportunities: Agro food processing can help to increase employment opportunities by creating jobs in the processing and manufacturing of food products.

There are also some challenges associated with agro food processing. Some of the challenges include:

High capital investment: Agro food processing can be a capital-intensive industry, as it requires expensive equipment and facilities.
High energy costs: Agro food processing can be an energy-intensive industry, as it requires the use of energy to power equipment and facilities.
Labor shortages: Agro food processing can be a labor-intensive industry, as it requires a large number of workers to operate equipment and facilities.
Environmental impact: Agro food processing can have an environmental impact, as it can generate pollution and waste.
Food safety concerns: Agro food processing can pose food safety concerns, as it can introduce contamination into food products.

There are a number of strategies that can be used to overcome the challenges of agro food processing. Some of these strategies include:

Investing in research and development: Research and development can be used to develop new technologies that can reduce the cost and environmental impact of agro food processing.
Developing new technologies: New technologies can be developed that can improve the efficiency and safety of agro food processing.
Improving efficiency: Efficiency can be improved through the use of better equipment and processes.
Reducing costs: Costs can be reduced through the use of more efficient equipment and processes.
Raising awareness of the importance of agro food processing: Raising awareness of the importance of agro food processing can help to attract investment and support for the industry.

There are a number of successful agro food processing projects around the world. Some examples include:

The Amul Dairy Cooperative in India: The Amul Dairy Cooperative is a cooperative of dairy farmers in India. It is the largest dairy cooperative in the world, and it produces a variety of dairy products, including milk, yogurt, cheese, and butter.
The Promasidor Company in Nigeria: The Promasidor Company is a Nigerian food company that produces a variety of food products, including milk, cereal, and juice.
The Wilmar International Group in Singapore: The Wilmar International Group is a Singaporean agribusiness company that produces a variety of food products, including oil, palm oil, and sugar.

Agro food processing is an important part of the agricultural sector. It can help to increase food safety, increase shelf life, increase nutritional value, reduce waste, increase income for farmers, and increase employment opportunities. However, there are also some challenges associated with agro food processing, such as high capital investment, high energy costs, labor shortages, environmental impact, and food safety concerns. There are a number of strategies that can be used to overcome these challenges, such as investing in research and development, developing new technologies, improving efficiency, reducing costs, and raising awareness of the importance of agro food processing.

What is Agro Food Processing?

Agro food processing is the transformation of agricultural products into food and other products for human consumption. It includes a wide range of activities, from harvesting and sorting to packaging and distribution.

What are the benefits of Agro Food Processing?

There are many benefits to agro food processing, including:

Increased food safety: Agro food processing can help to reduce the risk of foodborne illness by ensuring that food is properly handled and processed.
Increased shelf life: Agro food processing can help to extend the shelf life of food, making it available to consumers for longer periods of time.
Increased nutritional value: Agro food processing can help to increase the nutritional value of food by adding VITAMINS, Minerals, and other nutrients.
Increased variety: Agro food processing can help to increase the variety of food available to consumers, offering them more choices.
Increased Economic Development: Agro food processing can help to stimulate economic development by creating jobs and generating income.

What are the challenges of Agro Food Processing?

There are a number of challenges associated with agro food processing, including:

High capital costs: Agro food processing can be a capital-intensive industry, requiring significant investment in equipment and facilities.
High energy costs: Agro food processing can be an energy-intensive industry, requiring significant investment in energy-efficient equipment and facilities.
Environmental impact: Agro food processing can have a significant environmental impact, including Water Pollution, Air Pollution, and land degradation.
Labor shortages: Agro food processing can be a labor-intensive industry, requiring a large workforce.
Food safety: Agro food processing can be a high-risk industry, with the potential for foodborne illness if not properly managed.

What are the future trends in Agro Food Processing?

The future of agro food processing is likely to be shaped by a number of trends, including:

Increased demand for processed food: The global demand for processed food is expected to grow significantly in the coming years, driven by factors such as Population Growth, Urbanization, and changing lifestyles.
Increased focus on sustainability: There is a growing focus on sustainability in the food industry, with consumers and businesses demanding more sustainable food products and practices.
Increased use of technology: Technology is playing an increasingly important role in agro food processing, with new technologies being developed to improve efficiency, reduce costs, and improve food safety.
Increased Globalization/”>Globalization-3/”>Globalization: The global food industry is becoming increasingly globalized, with food products being traded and processed across borders.

What are the key players in Agro Food Processing?

The key players in agro food processing include:

Multinational corporations: Multinational corporations are major players in the agro food processing industry, with operations in multiple countries.
National companies: National companies are also important players in the agro food processing industry, often with a strong focus on domestic markets.
Small and medium-sized enterprises (SMEs): SMEs are also important players in the agro food processing industry, often specializing in Niche products or markets.

What are the regulations governing Agro Food Processing?

The agro food processing industry is subject to a number of regulations, which vary from country to country. These regulations typically cover areas such as food safety, environmental protection, and labor standards.

Which of the following is not a goal of agro-food processing?
(A) To increase the value of agricultural products
(B) To reduce food waste
(C) To improve the nutritional value of food
(D) To increase the cost of food
Which of the following is not a benefit of agro-food processing?
(A) It creates jobs.
(B) It increases the availability of food.
(C) It improves the quality of food.
(D) It increases the cost of food.
Which of the following is not a challenge of agro-food processing?
(A) It requires a lot of energy.
(B) It can produce pollution.
(C) It can create food waste.
(D) It can increase the cost of food.
Which of the following is not a type of agro-food processing?
(A) Canning
(B) Freezing
(C) Drying
(D) Increasing the cost of food
Which of the following is not a factor to consider when choosing an agro-food processing method?
(A) The type of food being processed
(B) The desired quality of the food
(C) The cost of the processing method
(D) The environmental impact of the processing method
Which of the following is not a way to reduce food waste?
(A) Improve storage and transportation methods.
(B) Educate consumers about food waste.
(C) Develop new technologies to reduce food waste.
(D) Increase the cost of food.
Which of the following is not a way to improve the nutritional value of food?
(A) Fortify foods with vitamins and minerals.
(B) Remove unhealthy ingredients from foods.
(C) Develop new technologies to improve the nutritional value of food.
(D) Increase the cost of food.
Which of the following is not a way to create jobs in the agro-food sector?
(A) Start a new agro-food business.
(B) Work for an existing agro-food business.
(C) Invest in an agro-food business.
(D) Increase the cost of food.
Which of the following is not a way to increase the availability of food?
(A) Grow more food.
(B) Improve storage and transportation methods.
(C) Develop new technologies to increase the availability of food.
(D) Increase the cost of food.
Which of the following is not a way to improve the quality of food?
(A) Use better ingredients.
(B) Use better manufacturing practices.
(C) Develop new technologies to improve the quality of food.
(D) Increase the cost of food.