Friday, August 17, 2012 08:00 IST
Akshay Kalbag, Mumbai
With the Indian Meteorological Department officially admitting to a drought-like situation recently, agriculture, which primarily relies on rains for normal output, and all allied sectors such as food processing, are gearing up for a fresh round of hike in prices of raw materials and its cascading effect - spike in prices of the final product - processed food.
It is estimated the prices of raw materials have gone up by 20-30 per cent in India (and roughly the same overseas). As a result, a 10 per cent increase in the prices of the final products appears to be par for the course for now.
But experts from the food processing industry say that eventually the final product could cost almost as much as, if not more than, the raw material because of factors beyond the manufacturers' control.
Industryspeak
M A Tejani, managing director, Gits Foods Products Pvt Ltd, Pune, and president, All India Food Processors Association (AIFPA), explains, “First of all, it would be incorrect to refer to the current climatic condition as drought. We are halfway through the monsoon, and the possibility of a contrary situation cannot be ruled out. Of course, it will not make any sense for farmers to sow new seeds in anticipation of a delayed end to it and heavy rains.”
“Rainfall has reduced by about 20-25 per cent of what it was at the same time last year. As a result of that, the quantity of perishables has reduced by about 30-35 per cent this Kharif season,” he said
.....read more
Akshay Kalbag, Mumbai
With the Indian Meteorological Department officially admitting to a drought-like situation recently, agriculture, which primarily relies on rains for normal output, and all allied sectors such as food processing, are gearing up for a fresh round of hike in prices of raw materials and its cascading effect - spike in prices of the final product - processed food.
It is estimated the prices of raw materials have gone up by 20-30 per cent in India (and roughly the same overseas). As a result, a 10 per cent increase in the prices of the final products appears to be par for the course for now.
But experts from the food processing industry say that eventually the final product could cost almost as much as, if not more than, the raw material because of factors beyond the manufacturers' control.
Industryspeak
M A Tejani, managing director, Gits Foods Products Pvt Ltd, Pune, and president, All India Food Processors Association (AIFPA), explains, “First of all, it would be incorrect to refer to the current climatic condition as drought. We are halfway through the monsoon, and the possibility of a contrary situation cannot be ruled out. Of course, it will not make any sense for farmers to sow new seeds in anticipation of a delayed end to it and heavy rains.”
“Rainfall has reduced by about 20-25 per cent of what it was at the same time last year. As a result of that, the quantity of perishables has reduced by about 30-35 per cent this Kharif season,” he said
.....read more
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