Wednesday, August 19, 2009

Indian Cold Store Capacity at Critical Levels

Up to 40% of Agricultural Produce Ruined for lack of facilities
Shipping News Feature

INDIA – A report prepared by KPMG together with the Associated Chamber of Commerce and Industry (ASSOCHAM) has highlighted a critical weakness in the country’s ability to preserve vital food produce.

In a statement ASSOCHAM president Mr Sajjan Jindal said that more than 30 percent of produce is being lost due to poor cold chain infrastructure, and that India has the ability to store 21.7 million tonnes in this type of environment and needs over 10 million tonnes more.

Most of India’s temperature controlled storage is reserved for produce which makes poor use of the available space such as flowers, grapes and citrus fruit. What is required is more development of privately capitalized facilities for bulk agri products. Despite the budget for the next year providing capital incentives for such projects, acquisition of the necessary land often proves impossible without Government intervention, much of it being state listed.

The report suggests that the long supply chain from field to retailer, caused by the country’s traditional use of middle men, has produced a disorganized and unstructured market to the detriment of the Country’s economy. It further urges more Government action to incentivise private companies to invest in upgrading to modern technology and premises.

If the Government heeds the report there should be opportunities for companies to assist in this essential industry growth which could prevent 30 to 40% of India’s food produce being lost in the fields post harvest for lack of suitable stores it can be transported to.