Food Processing Industry of India

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TOPIC : Food Processing Industry of India

B. Introduction
Food processing is the conversion of raw ingredients into food items or in other forms of consumables by using different industrial processes and tools in order to produce marketable, consumable and long shelf life food products. Benefits of food processing are the removal of toxins, food preservation (longer shelf-life), enabling of marketing and logistics tasks, and increasing of food consistency. The drawbacks in food processing industry are that its nutritional density decreases, increased in the use of food additives, and risks of metal contamination.

a. Global Food Processing Industry
The food processing industry accounts for 3/4th of food sales globally and is estimated to be at $3.6 trillion. More than 60% of total retail processed food sales in the world are done by the United States, European Union territories and Japan collectively. Japan is currently the largest food processor in the Asian region. Australia is the most technically advanced food-processing industry compared to other counterparts due to its high international standards and low pricing. China and India are the most rapidly growing countries in the food processing industry. The Sub-Sahara African countries, Latin America and parts of Asia are still in the initial phases of development of food processing sector.

b. India: Agriculture & Food Processing Industry
While India’s agricultural production base is quite strong, the food processing industry is still under developed. The Indian food processing industry encompasses many sectors – from production of raw materials used in food (the farm and fishing sectors) through to the export, import and processing sectors, and ultimately, to domestic sales to consumers.

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Source: Ministry of Food Processing Industries, Gol, Annual Report 2007-08; IBEF report

India ranks 2nd largest food producer in world due to its arable land area of about 184 million hectares (454.6 million acres). India also boasts 485 million livestock population and 489 million poultry. Annually India produces 90 million tonnes of milk, 150 million tonnes of fruits & vegetables, 204 million tonnes food grain and 6.3 million tonnes fish. Food and groceries form major portion (75%) of the retail pie but it still has the lowest level of penetration of 1% in organized retail. However, the branded foods market size is growing at 15-20% and industry players have outlined major expansion plans recognizing this opportunity.

|Indian Food Processing Industry: Key Statistics (in INR000' crores) | |Years |2002-2003 |2006-2007 |2010-2011* |2014-2015* | |Food Industry Size |770 |880 |1,100 |1,320 | |Food Processing Industry Size |308 |374 |484 |660 | |Size of organized Sector in Food |57 |101 |162 |264 | |Processing Industry | | | | | |% Share of Food Processing Industry |40 |43 |44 |50 | |in total Food Industry | | | | | |% Share of organized sector in Food |19 |27 |36 |40 | |Processing Industry | | | |...
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