Let us prey and hope, the light of these small Diwali lamps be the harbinger of joy and prosperity. As the holy occasion of Diwali is here and the atmosphere is filled with the spirit of mirth and love, here’s hoping this festival of beauty brings your way, bright sparkles of contentment, that stay with you through the days ahead.

Best wishes on Diwali and New year

Competent Agrisolutions Pvt Ltd announces its strategic partnership with the Netherlands based company, Omnivent, as their sole representative for India and neighboring countries.
 
Active all over the world, Omnivent is specialist in the development, manufacturing and installation of modern ventilation and climate technology systems for storage of agricultural produce like Potato, Onion and Carrots etc.

The power of Omnivent lies in the well-thought storage concepts. Whether new projects or the renovation of existing ones, Omnivent’s specialists work out a design for specific situations. Omnivent offers a total package. Right from first draft to the final implementation. Or shall we say "from design to return on investment". Read more about Omnivent at

Just sharing a powerful video from Resource Interactive shown at the Shop.org Annual Summit on how mobile, social media and geolocation will change shopping. Forever. Click here

Few weeks ago, Bruce Peterson of Wal-Mart said that advance in frozen vegetables represent a threat to the fresh produce industry in US.  How does the fresh produce industry respond to this threat, a keen industry observer asked?

Some lateral thinking on the subject.

Let’s face it. Freezing fresh fruit and vegetables is a highly energy intensive industry. Though a dated report, according to the U. S. Census Bureau, the U.S. had 235 frozen fruit, juice, and vegetable processing facilities in 2002 which consumed an estimated 2,925,970,000 kWh of electricity, and had energy costs totaling more than $276 million (includes electricity and other fuels).

Flavors and other advances notwithstanding, growth of frozen fruit and vegetables in foreseeable future shall be driven by the energy availability, cost and its alternate uses. Capitalizing on this fact through advertisements is perhaps the best defense to respond to this threat. Let’s fresh produce industry join hands to have an ‘energy efficiency brigade’ do this job.

Freezing also changes the market dynamics for fresh produce. If it is not for freezing at peak availability, market prices for fresh shall remain low, rather dirt cheap. Low prices in turn shall ensure better availability of fresh in the market place and thereby, increased consumption due to lower prices. Price / demand elasticity for few commodities shall play it role here. A good copy writer or a social activist can capitalize on this situation and build some campaign for a consumer education campaign.

Having said above, job building potential by frozen F&V industry is well appreciated. So this lateral thinking is to be considered only in view of the greater macro economic picture.

Cold storage reduces the rate of biochemical changes in fresh foods and also slows down the growth of contaminating micro-organisms. The reason for storing perishables in a cold store is therefore to extend their life beyond the harvest season. This may be because they can achieve a higher sale price out of season or for food security reasons.

The paradox called India – Incredible India – is not unconcerned about shelf life extension, higher price realization or food security. Than why cold storage industry is not growing in India. Read on…

Are there any wastages? This is a myth.  Every things sell in India. In my 20 plus years career with organized fruit and vegetable trade I have not yet seen the so talked about wastages to an extent of 30 to 40% as physical waste. No one however considers or is bothered about the value loss. Every thing physical sells. Sadly this demand driven market phenomenon where value loss is not considered either by customers or planners is what clouds everyone’s perception and prevent cold chain growth in India.

Lack of cold chain demand makes the cold chain infra costly (more demand – more competition – lesser price), the additional cost (in comparison with non cool chain products) eventually gets loaded on the products serviced through high cost cold chain. Now, if supposedly some inferior product is available at a lesser price, very few in India shall buy a superior product serviced through cold chain, particularly when product in question is considered “fresh” only when it comes outside the controlled atmosphere (read cold store). Remember – fresh peas here sells @ Rs 150 a kg during off seasons against frozen at Rs 50 Kg. You need to have customers. Period..

Therefore, I am of the view that future demand for cold chain in India shall be driven not by fresh foods but by foods and pharmaceutical categories which compulsorily requires cold chain. Ready to eat frozen products, frozen vegetables, imported fruit etc comes to mind here. If these categories grow in India – infra to handle this shall automatically grow. Increased growth of cold chain shall drive down the cold chain price for more adopters to follow, reducing the cost. I can foresee a strong correlation between cold chain growth with growth of microwave ovens. At the end of the day it is all about markets.

It is not only the demand of right products that hinders the growth of cold store industry in India, services too share equal blame. Let me explain.

Few years back we built a world class cold storage infra for potatoes and apples at the only clock auction market for fruit and vegetables in India. This cold stores had all the modern bells and whistles like pallets, forklift, screw compressors et al. Know what happened. Third party apple storage for trading at this store turned out to be a non-starter as apple trading in India is based on samples for small lots which could not be drawn out for inspection by traders as quickly as they are drawn out in an ambient environment or a traditional cold store. Moral of the story. Trade’s service demand dictate the cold storage needs.

What majority of us overlook is integration of technology with dynamics of fresh trade, which is tricky and complicated in India when compared to trade in mature economies. Otherwise, how almost negligible onion / garlic cold storage with just 4-5% loss can be explained against a backdrop of 30% plus losses from traditional onion storage in India. A country that invented zero surely understand the huge differential and potential savings from cold storage with ventilation to store onions at much lesser loss but still continuing with traditional storage.

May I also add here that it is for the similar reasons we don’t see many grain storage silos in India. Though not directed linked to cold chain industry, the point could lead us to some realistic assessment as regard to ‘Why cold storage industry is no growing in India’.

We let our grain go waste on open air plinths or shoddy warehouses but don’t build grain silos because that would entail disturbing the existing trade which is deeply entrenched with elements like commission agents, thekedaars, palledars, gunny bags et al. These elements and the way they operate in the market place, shall never let silos happen in India unless someone carrying a big stick and with loads of political will comes up and reform agricultural marketing scenario in each individual Indian State. (BTW Agriculture is a state subject in India). Because Silos, in comparison with existing trade, demands altogether different material handling, shipping and trade requirements. Silos are more transparent way of handling and accounting grains is just incidental.

Like butterfly effect, these small differences in service demands of dynamic market systems produce large variations in the long term behavior of infrastructural needs for products and planners.

In a similar vein – many years back while planning a trial shipment of Indian potatoes from Tuticorin in State of Tamil Nadu in India to Colombo in Sri Lanka through refrigeration mode, I discovered a very disturbing fact. Cost of a 40′ reefer container at Tuticorin for Colombo was much more for an overnight sea journey between these two locations than it was for Antwerp (Belgium) and Colombo, a journey that took more than 25 days. Reasons for this variation were not very hard to seek.

WE WERE NOT IMPORTING ANYTHING IN REFERS AT TUTICORIN. So the containers had to be specially brought in at Tuticorin for our trial – raising the cost. So TO EXPORT MORE IN REFERS YOU HAVE TO IMPORT MORE IN REFERS. Reverse logistics.. Common sense..but see the impact.

It was no surprise when I visited John Keels and Cargills’ (Supermarkets in Colombo, Sri Lanka) few days thereafter, I could not find even a single box of Indian Apples though India is the nearest apple growing country and Kinnaur apple won hands down at a blind tasting session which I conducted at both these supermarkets.

Strange are the ways of bazzars….Quite often you need to hit North to correct South.

Who shall bell the CAT, please?