Case Study – Vendor Research
VENDOR EVALUATION IN INDIAN PORK INDUSTRY
A client intended to partner with Indian pork related importers, to expand their business in India
50 – 60 hours of research
With our assistance, the client was able to successfully tie up with Indian importers
VENDOR EVALUATION IN INDIAN PORK INDUSTRY
1. Market Size
2. Pork Consumption
2.1.North East India
2.3.Kolkata (West Bengal)
3. Exporting to India
4. Major Suppliers of Pork and Pork Products
5. Netherlands can export pork to India
6. Import Regulations
6.1.Import Duty and Import Policy
6.2.Producing high-quality pork in India
6.3.Advantages of Pig Farming in India
6.4.Major Constraints in the Growth of the Pork Industry in India
6.6.Pork Sales Pattern
6.7.British Pig Genetics in High Demand
6.8.UK pig industry helps India produce better quality pork
6.9.Arohan Food is driving the market in North-Eastern India
7. Concluding Insights
FROZEN PORK MARKET IN INDIA
- In 2014-15 (April-March), Pork production in India was estimated at 464 thousand metric tons, which contributes approximately 8% of the country’s animal protein sources
- From 2009-15, pork production increased at a slow pace with annual growth rate of 1.4%
- In 2015, India’s pork import was 527 metric tons, which increased by 28% from the previous year
- From 2010 to 2015 pork imports increased at a CAGR of 11% on steady demand in hotel, restaurant and institutional sector as well in high-end retail segment
- According to Livestock Census 2012, the pig population declined by 7.5% to 10.3 million from 2007 to 2012
- The eastern and north eastern regions of the country comprise around 63% of the pig population
- North-East India (Assam, Nagaland, Arunachal Pradesh, Manipur, Meghalaya, Mizoram, Sikkim and Tripura), South India (Goa, Karnataka, Andhra Pradesh, Tamil Nadu, Kerala and Bangalore) and the Chinese community of West Bengal are the major areas of pork consumption
- Majority of the pig population in India is indigenous breeds (76%) though the population of cross-breed and exotic pigs increased by 12.7% from year 2003 to 2012
- The exotic pig breeds mainly comprise of Hampshire, Large White, Duroc, Landrace, and Tamworth while some of the popular indigenous pig breeds include Ghungroo, Niang Megha, Ankamali, Agonda Goan and TanyVoEven a small rise would make a huge difference
- India often tends to be overlooked in the world’s pig developments. The country, however, harbours a huge market and a lot of potential. In India, pork simply has never really had a good name.
- The situation of pork in India is similar to China; the country has 1.2 billion people but contrary to China, India hardly has a tradition in pork production or According to the 2012 Livestock Census, pigs take up just over 2% of the total livestock population in India, and the total number of pigs is just under 10.3 million. The lion’s share of this apparent national disinterest can be explained by customs and tradition. For a long time the meat trade was controlled by muslims, who would simply not touch pork.
- In addition, pork hasn’t always been held in very high esteem in Indian society. Low caste Hindus have long seen an opportunity to use pigs to scavenge waste, which would bring the animals generally in places of low hygiene and diseases – far away from professionally produced pork. It is not difficult to envisage how upper castes, who would not buy from lower castes anyway, look at the quality and safety of the domestic pork products.
- Added to this the absence of sufficient amounts of cost-efficient corn crops, a relatively poor infrastructure and the divine status of cows in India, and this explains the Indian predilection for mainly chicken, fish and vegetarian dishes.
- Still, in a country with 1.2 billion souls, even a little increase in pork consumption would be a tremendous Just like in China, the country has a large and rapidly growing middle class – a strong growth in mid-range restaurants and organised supermarkets can therefore be observed. Although per capita pork consumption is still expected to be small for another decade, it is not difficult to see India’s potential. Even at 0.5 kg per person per year, this could be a demand for at least 500,000 tonnes.
- The per capita pork consumption in India is negligible
- India’s Muslim population comprising 14.2% of the total population do not eat pork due to religious reasons.
- Hotels and restaurants are the major buyers of the imported pork products, which cater to international travelers and wealthier Indian consumers
- Pork is commonly available in Goa and consumed largely by the Catholic community, which accounts for 26% of the state’s population
- Eating pork could be a cheap protein fix for Indians and cultivation of rapidly multiplying pigs will boost income for rural farmers
- Pork and Poultry meat are used for production of ham, sausages, patties etc. for the elite market
- Poultry is the most preferred meat in India which is currently experiencing a strong growth
North East India
- Ethnically and culturally akin to South East Asia, this is one of the poorest regions. It records the highest pork consumption in the country – the state of Assam is India’s number 1 state with 9% of all pigs. Many locals keep pigs, some pork is imported from Myanmar.
- Meat is popular in the south of India; particularly Goa is worth mentioning due to many Christians living
Kolkata (West Bengal)
- Demand for pork comes from the city’s immigrants as well as its Chinatown – the only one in India. This Chinatown has a population of about 7,000. The area ranks fifth with regard to pig numbers in India – about 3%.
- For a large part of India not known for pork consumption, there are possibilities as In the words of Thom Wright, agricultural attaché for the US embassy in New Delhi, the majority of Hindus are willing to try quality pork, as long as it is imported.
Exporting to India
- A solution for on one hand meeting pork demand – and creating a stronger demand on the other – would be to step up exports to India. In Europe, the Netherlands, Germany, Italy and Spain are known to export pork to India – and so does g. Chile.The Netherlands, for instance, exported 36 tonnes of predominantly fresh, chilled or frozen pork to India in 2013.
- Exporting pork nevertheless, has come with serious challenges over the years. Again the US embassy quoted industry sources stating that on exports from e.g. the United States, a ‘500% markup’ can be expected due to taxes, tariffs, local VAT and a fragmented supply chain.
- For fresh pork to enter India, several hurdles exist. Not only the slaughterhouses have to meet requirements, also the farms have to abide by certain First, there is a range of hygiene measures as the country has to be free from e.g. Swine Vesicular Disease, African Swine Fever, Aujeszky’s Disease (pseudorabies), Foot- and-Mouth Disease and vesicular stomatitis In addition, also the farm of origin has to prove it’s been free of a range of diseases, including e.g. atrophic rhinitis, transmissible gastro-enteritis (TGE) and Porcine Reproductive and Respiratory Syndrome (PRRS) for the past two years. On top of that, the farm needs to show that it has not been using meat and bone meal or blood plasma.
Major Suppliers of Pork and Pork Products
- Major suppliers of pork meat to India are Belgium, Sri Lanka, Spain, Italy and Netherland
- The major imported pork products include pork belly, chops, loin, tenderloin, neck, shoulder, spare ribs, bacon, ham, salami and sausages. US pork exports to India are effectively prohibited due to India’s restrictive sanitary import protocol
- India applies 30% basic tariff on imports of pork and pork products. Indian exports of pork and pork products are negligible
Netherlands can export pork to India
- Consumers in India, when interested in eating pork, can opt for pigmeat from the Netherlands as from this
- The Netherlands Food and Consumer Product Safety Authority reported last week that a certificate has been agreed with the Indian authorities for the exporting of pork and pigmeat products.Despite not having a very strong culture of pork consumption, India is a very interesting market for the pig The country has 1.2 billion inhabitants, and in two areas in particular people do eat pork – in the south, around Goa and in the far east, close to the border with Myanmar.
- Between 2010 and 2015, India’s imports of pig meat increased at an average annual rate of 11 percent, according to the USDA Foreign Agricultural Service. In 2015, the volume jumped 28 percent from the previous
- In recent years, the major suppliers of pork to India have been Belgium, Sri Lanka, Spain, Italy, and the Netherlands, according to FAS. In 2015, pig meat products also came in from the UK and Germany.
- The basic tariff on imports of pork and pork products is 30 percent.India’s restrictive sanitary import protocol effectively prevents pork exports from the U.S., but early in 2016, the Canadian government secured export market access for its pig meat and
- Imports of processed and frozen pork meat into India are overseen by the Ministry of Agriculture’s Department of Animal Husbandry, Dairying and Fisheries (DAHD). Imports are allowed only upon issuance of a sanitary export certificate signed by the appropriate authority of the exporting country. India must also issue an import permit to the importer in order to ship to India
- The Government of India prohibits importation of specific livestock and livestock products including poultry and poultry products, live swine and swine products from countries reporting the outbreak of Highly Pathogenic Avian Influenza (HPAI) and Low Pathogenic Avian Influenza (LPAI)
- Imported pork products face high retail costs due to several factors. These include a fragmented supply chain, local VAT, sales taxes and municipal “octroi” (a tax on
certain goods entering a town), as well as applied tariffs for pork and pork products ranging between 30 and 36% (including CVD – Countervailing Duty)
- end hotels as well as interested middle class consumers. So far, 150 meat processing plants are known to exist throughout India to deal with pork – all working on a small scale in the private
- To give the country’s development a boost, the government proposed schemes to establish modern processing plants and in some states pig producers’ cooperatives are emerging.
Advantages of Pig Farming in India:
Pig farming has many advantages. Here, I am shortly describing the main advantages of starting commercial pig farming business in India:
- Pigs grow faster than any other animals. They have higher feed conversion efficiency. That means, they have a great feed to meat converting ratio. They can convert all types of inedible feeds, forages, certain grains byproduct obtained from mills, damaged feeds, meat byproducts, garbage etc. into valuable, nutritious and delicious
- Pigs can eat and consume almost all types of feed including grains, damaged food, forage, fruits, vegetables, garbage, sugarcane etc. Sometimes they even eat grasses and other green plants or
- Pigs become mature earlier than other animals. A sow can be bred for first time at their age of 8-9 months. They can farrow twice a year. And in each farrowing they give birth of 8-12
- Setting up pig farming business is easy and it requires little capital/investment for building houses and buying equipment.
- The ratio of total consumable meat and total body weight is higher in pigs. We can get around 60 to 80 percent consumable meat from a live pig.
- Pig meat is also one of the most nutritious and tasty meat. It is higer in fat and energy and lower in water.
- Pig manure is a great and widely used fertilizer. You can use this manure for both crop production and in pond for fish farming
- Pig fat also has a huge demand in poultry feed, paints, soap and chemical industries. And this demand is continuously
- Pigs grow faster and has a good ROI (returns of investment) ratio. They reach slaughter age earlier compared to other animal. A pig become suitable for slaughtering purpose at their age of 7-9 months. Within this period they reach marketable weight of 70-100
- Pig meat has a good domestic demand. We can also earn good income by exporting pig products like bacon, ham, lard, pork, sausages to the foreign countries.
- Pig farming business can be a great income opportunities for the small and landless farmers, unemployed educated or uneducated young people and for the rural
- In a word, commercial pig farming can be a great business idea and income source for the people and it can contribute the national income of our country
Major Constraints in the Growth of the Pork Industry in India
- The health status of the pigs is poor as they are not necessarily grain-fed. The corn feed needed to raise quality pork in India is not grown cost efficiently to sustain domestic swine herds. India is not a large producer of pork products because of backyard operations, limited commercial farming
- The sector is also constrained as most of the pig farmers belong to the lower socio- economic strata and undertake pig farming as a livelihood rather than scientific pig farming with improved foundation stock, proper housing, feeding and management
- Disease outbreaks often devastate local pig populations
- The two major problems revealed by the pork retailers are that there are protests from Muslims and 80% experienced lack of availability of meat
- A sizeable proportion of the urban and rural households do not consume beef and pork because of religious inhibition
- Feeding the Lactating Sows: A sow, when fed properly, may yield 2.5 to 3.5 litres of milk per day. For small litter 2 to 2.5 litres of milk is sufficient. However, sows which are nursing 10-12 piglets must produce maximum milk to meet the requirement of the piglets. To maintain the ration, an allowance of lOOgm- 200 gm ration per piglet per day may be fed to the mother. Thus a sow 96 nursing 10-12 piglets will require about 5 kg of ration daily. Whenever a sow dies due to some complication, their orphan piglets have to be given proper care and These piglets can be raised by hand feeding with cow’s milk or buffalo’s milk or any other suitable milk replacer. One of the factors to be noted is that cow’s milk is deficient in iron and copper, so small amount of these elements must be added to milk. The milk should be fed at about body temperature to the piglets of up to 2 weeks of age. After 2 weeks it should be adopted to feed the piglets. The movement of frozen, chilled swine meat is limited by poor infrastructure, transport systems and cold storage throughout India
- In reality, the government breeding farms fail to supply the required number of quality piglets to the farmers
Pork Sales Pattern
- A study was carried out to analyze the trend and seasonal variations in pork sales in primary market centre near Chennai Metropolitan. It revealed that the quantity of pork sold did not show much variation from the past to the period of survey
- Pork sales index was observed to be extremely high during Sunday (325.65) which was 3.25 times more than the mean level. During rest of the days in a week, the pork sales index was found to be less than
- It was concluded that strategies may be framed to increase the supply of pork during summer months and Sundays to efficiently trap the demand for pork. Further, access to pork might be improved by establishing more retail outlets at Chennai and improving consumer awareness through extension
British Pig Genetics in High Demand
- A high-level delegation from the Punjab government has paid a visit to the UK to assess British pig production and genetics as the Indian state intends to develop its burgeoning pig sector
- Visitors also went to APHA Weybridge and Kent University to look at research into pig breeding, including embryo transplant
- Punjab is taking the lead in the modernization of Indian agriculture and already produces 76,000 tonnes of pork on a yearly basis
UK pig industry helps India produce better quality pork
- UK pig semen has been imported to India to help the country improve its breeding stock and produce better quality pork. The frozen porcine semen is being used by the Punjab government to develop a high-health nucleus of pure-bred pigs.The UK beat tough competition from other major pork- producing countries, with a second order already placed for the semen. Commenting on the development Jean-Pierre Garnier, head of exports for AHDB, said: “With India due to become the most populated country in the world over the next few years and with a rapidly increasing demand for high-quality, safe meat, this type of development is essential.”
Arohan Food is driving the market in North-Eastern India
- India’s first pork integrator currently produce 10 SKUs of the product in different flavors of sausages and salami, produces their products from National Research Centre on Pigs at Guwahati
- 60% of the entire pork consumed in India, happens in the North – Eastern
- Looking to expand market to Punjab & Haryana and even neighboring countries like Nepal and Bhutan
Achieving 30% Growth Rate in the Piggery Sector It is envisaged that the piggery sector will be dominated by crossbred and improved variety of pigs to the level of 80% in the next 35- 40 years. The population of indigenous pigs will be about 20%, maintained mainly under various in situ conservation programmes.
9. http://www.g-e fa.de/fileadmin/termine_downloads/Marktstudien/Indien/PORK_MEAT_IN_INDIA_-_Report.pdf