The food processing sector has various sectors including consumer foods (snacks, beverages, etc.), dairy, meat and poultry, fish, grains and cereals, and fruits and vegetables. Fruits and vegetables and meat and poultry take the lion’s share of about 40 percent of the total household consumption. The Indian food industry is poised for huge growth, increasing its contribution to world food trade every year. In India, the food sector has emerged as a high-growth and high-profit sector due to its immense potential for value addition, particularly within the food processing industry.
The Indian food processing industry accounts for 32 per cent of the country’s total food market, one of the largest industries in India and is ranked fifth in terms of production, consumption, export and expected growth. It contributes around 14 per cent of manufacturing Gross Domestic Product (GDP), 13 per cent of India’s exports and six per cent of total industrial investment.
India is well-known for its food and beverages service industry. It is one among the most vibrant industries which demonstrated unprecedented growth in the recent past. The industries is continues to expand rapidly. This growth can be attributed on account of changing demographics, growing disposable income, urbanization and growth of retail industry.
Indian food service industry is expected to reach US$ 78 billion by 2018.The Indian gourmet food market is currently valued at US$ 1.3 billion and is growing at a Compound Annual Growth Rate (CAGR) of 20 per cent. India's organic food market is expected to increase by three times by 2020##.
Investment prospects for food processing in India
India’s vast agricultural resources alone creates huge potential for investments in its food processing and equipment industry. Major areas holding scope for value added processing are in the canning, packaging, dairy and food processing, frozen food, and thermo-processing industries.
Currently, food processing accounts for almost one-third of the total food market in India. The food processing industry is valued at US$258 billion, and is the fifth largest industry domestically in terms of production, consumption, export, and expected growth in the country. The country’s food processing industry is expected to reach US$482 billion by 2020, driven by growth in organized retail, changing consumer behaviour, and increasing consumerism in tier II and tier III cities.
Key Drivers of Growth in Food Processing
· Consumer Spending on Food
The Indian food and grocery market is the world’s sixth largest, with retail contributing to 70 percent of the total sales. On average, Indians spend 31 percent of their total earnings on food and grocery. In contrast, consumers in the US spend only 9 percent, while in Brazil and China, the expenditure on food is 17 percent and 25 percent, respectively.
· Change in Consumer Taste and Preference
With growing awareness, better health consciousness, need for convenience, and improving lifestyles, and the share of processed food is gradually and steadily increasing on consumer plates across the world. In India, this change is bolstered by rising per capita income, a large young population (60 percent below 35 years of age), deeper retail penetration, and a growing number of nuclear families. India’s demands for processed food is, therefore, expected to increase to about 8.5 percent by the end of 2017.
· Growth in Food Exports
There is a rise in the demand for Indian processed food in the international market. In addition to changing consumer tastes in foreign markets, approximately 30,843,419 16 people of Indian origin live abroad. In 2016-17, the total exports from this sector witnessed a positive growth of 0.55% to reach US$ 24657.09 million, thus, occupying a share of 8.92% in India’s overall exports.
The growth of the food and beverages industry is propelled mainly by developing countries such as India, China, and Brazil, as the economies of these nations improve and more people are lifted into the middle class.
The global food, beverage, and grocery industry was estimated to be worth $7.8 trillion in 2015, or about 10 percent of the world GDP, according to Plunkett Research. The global packaged-food industry was worth $2.5 trillion.
F&B industry in India
India is expected to become the fifth largest consumer market in the world by 2025. Food and beverages is the biggest of the consumption categories. The F&B sector is supported by the vast agriculture sector: India is the biggest producer of pulses, and the second biggest producer of rice, wheat, sugarcane, and fruits and vegetables.
It is also the biggest producer of milk and buffalo meat and ranks fifth in poultry production. The other helpful factors: large extents of arable lands, favourable climate, long coastline, and low wages.
The beverage industry, excluding alcoholic beverages, is worth about $16 billion. Tea and coffee are the most popular beverages, followed by soft drinks (carbonated drinks and juices), health drinks, milk-based drinks, flavoured drinks, and energy drinks.
Half of the tea and coffee consumed in the country is sold unpacked. The alcohol beverages market is estimated to be worth about $35 billion, with whiskey, beer, and wine as the most popular drinks.
The food and beverage market was estimated at US$30.12 billion in 2015 and is expected to reach US$142 billion by 2020, with a compounded annual growth rate (CAGR) of 36.34%. The sector is dominated mainly by traditional operators. The brands and restaurant chains of both Indian origin and multinationals have not optimally penetrated the market so far. The food and beverage sector has evolved over the past decade, giving rise to exciting new concepts in food and beverage offerings and new and innovative service elements.
In India, the food sector has emerged as a high-growth and high-profit sector due to its immense potential for value addition, particularly within the food processing industry.
Agriculture and Food Industry in India
Agriculture plays a vital role in India’s economy. Over 58 per cent of the rural households depend on agriculture as their principal means of livelihood. India is the largest producer, consumer and exporter of spices and spice products. India's fruit production has grown faster than vegetables, making it the second largest fruit producer in the world.
Exports
In 2016-17, the total exports from this sector witnessed a positive growth of 0.55% to reach US$ 24657.09 million, thus, occupying a share of 8.92% in India’s overall exports. Indian agricultural/horticultural and processed foods are exported to more than 100 countries/regions; chief among them are the Middle East, Southeast Asia, SAARC countries, the EU and the US.
· Exports from Spices, which is the third largest export item from this sector, witnessed a growth of 13.74%, occupying a share of 1.05% in overall exports of the Industry to reach US$ 2890.58 million.
· Exports from Fresh fruits witnessed a much faster growth of 16.76% as compared to that of Fresh vegetables which witnessed a growth of 6.54%.
· Major Export items in terms of value such as Buffalo Meat, Basmati Rice and Sugar, occupying a share of 34% in overall exports from this sector, witnessed a negative growth of 3.55%, 7.35% and 13.3% respectively.
Exports from segment of all the processed items including Processed Fruits and Juices, Miscellaneous Processed items and Processed Vegetables witnessed a positive growth except for Processed Meat which recorded a negative growth of 28.58%
The Indian food industry is poised for huge growth, increasing its contribution to world food trade every year. In India, the food sector has emerged as a high-growth and high-profit sector due to its immense potential for value addition, particularly within the food processing industry.
Here are few Projects for Startup:
INSTANT GINGER POWDER DRINK
Ginger is one of the oldest and most important spices used in different kinds of food preparation. Ginger possesses a warm pungent taste and a pleasant odor, hence it has a wide use as a flavoring in numerous food preparation, beverages, ginger bread, soups, pickles and many soft drinks. Read more
MAHUWA OIL
Mahuwa is a tropical fruit. It is found in the month of April - July or August - September. It is a fleshy green, yellowish or orange brown when ripe, 2.5 to 5 cm long, 1-4 shining seeds. It’s total mass content 70% in seed, two kernels in a seed. 2.5 cm X 1.75 cm, oil content 46% in latatolia and 55% in longitolia which are smaller in size. Read more
SOYA LECITHIN
Lecithin is a synonym for phosphatidylcholine. It is the main lipid component in biological membranes, like our cell membranes or cell walls of plants. On the other hand, commercial lecithin is actually a natural mixture of neutral and polar lipids, including glycolipids, triglycerides, sterols, and small quantities of fatty acids, carbohydrates, and sphingolipids. Read more
PLAIN CORN FLAKES & COATED CHOCO FLAKES
Corn flakes being one of most nutritious foods and is consumed as breakfast food not only in India but-everywhere in the world.Cornflakes are a very popular breakfast cereal manufactured from maize. Cornflakes are an almost 0 fat, 0 cholesterol food and contain a high amount of fast acting carbs with dietary fibers. Read more
WINE FROM KINNOW FRUITS
Kinnow has acquired commercial importance and popularity owing to its success under varied agro climatic conditions, response to inputs and high economic returns. Its unique features like gad tree vigor, high fruits yield, excellent fruits quality, higher juice and wider adaptability. Read more
VANASPATI GHEE
The synthetic fats are known in India by different names such as Vanaspati, Dalda Ghee, and Hydrogenated Oil etc. Perhaps because vanaspati ghee is manufactured with vegetable oils and there is not much change in the components of vegetable oil after it has undergone the process of refining and hydrogenation, the name Vanaspati has been given to this refined oil. Read more
SOYA BEAN OIL, SOYA PANEER & SOYA EXTRACT
Soya bean is one of the most important agro based product, which has commercial value after the rice, wheat, maize etc. Today, soya bean is an important source of protein and oil in human nutrition, especially in Asia. In other parts of the world, soy based foods are consumed merely due to its healthy image. Read more
LYCHEE JUICE
Lychee is one of the tropical fruits which is mainly available in Bihar, and Eastern part of India. It is one of the healthy fruit juice. It will help to grow the health. It is sweet tasty with good flavour. It is used by the domestic people throughout the year. Sixty percent of the fruits is edible. Read more
RED CHILLI POWDER
Chilli is cultivated mostly as a rein-fed crop, but in areas of low rainfall it is grown under irrigation. In the genetic area, it is a cold weather crop. The crop is raised on a variety of soil. For cultivation as a rain fed crop, well drained heavy soils which retain moisture should be selected. Read more
OLIVE OIL
The olive is a species of small tree in the family Oleaceae and is of major agricultural importance in the Mediterranean region as the source of olive oil. Olive oil is a fat obtained from the olive (the fruit of Olea europaea; family Oleaceae), a traditional tree crop of the Mediterranean Basin. Read more
BARLEY MALT
Barley Malt is germinated cereal grains that have been dried in a process known as "malting". The grains are made to germinate by soaking in water, and are then halted from germinating further by drying with hot air. Read more
SOFT DRINKS (COLA, ORANGE, LEMON, MANGO PULP, GINGER, CLEAR LEMON 7UP TYPE)
Soft drinks are largely used in the society to serve any guest in the house, in the commercial and industrial units to entertain the customers. It sometimes acts as medicine also, for little stomach problems or headache. It is used as drinks for recreation. Read more
TOMATO PULP
Tomato pulp is very much popular item derived from tomato fruit. It is a ground form of tomato having only 6% solid content. A wide variety of products are available by processing tomato pulp. Tomato pulp is used for the production of a wide variety of tomato products like sauce, ketchup, juice, etc. Read more
MAYONNAISE
There are few unorganized and private companies engaged in the manufacturing of Mayonnaise. It may be called the product is better substitute product. For the product manufacturing basic raw materials required vegetable oil, vegetable protein, milk protein, egg protein or fat emulsifier salt and water. Read more
TUTI FRUITY FROM PAPAYA FRUIT
Papaya is second most nutritive food to Mango. Tuti fruity is made by impregnating fruits with flavour & taste along with attractive colour. It is useful in the preparation of other food items such as toppings. It provides attractiveness as well as nutritive value to many food items. Read more
FLAVOURED RAISINS
Raisin is prepared from the sound dried grapes of the varieties conforming to the characteristics of Vitis vinifera L. processed in an appropriate manner into a form of marketable raisin with or without coating with suitable optional ingredients. Read more
APPLE CHIPS
Apple is one of the delicious fruits. It contains vitamins, minerals, enzyme, fruit juice etc. Apples can be preserved in the form of apple chips by drying it. In normal drying apples pieces changed its colour to brown. There is very good market of apple chips. It can be sealed in the aluminium foil. Read more
PULPY FRUIT DRINKS (FRUIT JUICE WITH FRUIT PULP)
A freshly squeezed orange or fresh pulped and strained apple would supply a fruit juice drink for immediate consumption, but to expect it to maintain its quality for even a day or two was tempting providence. Nowadays, with the benefit of ultra-high temperature (UHT) pasteurisation, aseptic packaging techniques and systems, pressed juices can be stored for extended periods with very little deterioration in quality. Read more
ENERGY PROTEIN BAR
Energy bars are often promoted as a quick snack, a supplement athlete/ sports person or those who done workouts energy bars are also an excellent method for replenishing muscle energy store after sport. For best results eat an energy bar 30-45 minutes before a race or workout or eat small amount during in race or ride. Read more
PACKAGED DRINKING WATER
Water quality and quantity are interdependent, interacting elements of water system. The term water quality refers to the level of suitability of water for specified purposes. Use of mineral water gradually increase in India due so shortage of pure hygienic water and also increase the knowledge of water because pathogenic microorganisms, which are main reason of stomach problem. Read more
KHANDSARI SUGAR
Sugar has served mankind as a source of energy and as a sweetening agent the down of civilization. Khandsari is a kind of raw cane sugar manufactured in India since ancient times. The majority of the khandsari industry is mainly in Uttar Pradesh. Some khandsari is also produced in Punjab, Maharashtra, Andhra Pradesh and Mysore. Read more
BESAN PLANT (GRAM FLOUR)
Besan is primarily prepared from grinding of Channa Dal. This is a very important food. It contains large quantities of protein and vitamins. The CFTRI, Mysore has also developed modern Dal Mill to have better yield of improved quality. It is a very important ingredient for making Kitchen Dish for men, women and children. Read more
VERMICELLI BY AUTOMATIC PROCESS
Extrusion is defined as a process in which material is pushed through an orifice or hole of given shape. The origin of the world comes from Latin (exmeans out and trudere means thrust). The pushing force is applied by using a piston or a screw. Read more
COUNTRY LIQUOR FROM MOLASSES
From earliest times man has sought for beverages, which give him refreshment and now some of them have become almost an essential part of human diet. There are two kinds of beverages non-alcoholic and alcoholic. There are some alcoholic beverages which are fermented but are subsequently distilled is produced with the aid to yeast culture. Read more
NON-DAIRY WHIPPING CREAM
Dairy products are dairy base farm house products. It is mainly milk, cheese, butter, ghee, cream etc. where basic raw materials come out from milk which is produced in dairy farm. Now milk is also manufactured form agro based products like groundnut, soyabean as basic raw material milk can be produced from agro products or from animals like cows, buffaloes, goats etc. Read more
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