FICCI’s first virtual Foodworld India show takes off

The Federation of Indian Chambers of Commerce and Industry (FICCI) on 24 March 2021 inaugurated the 13th edition of the Foodworld India show virtually for the first time owing to the pandemic situation.

Dilip Chenoy, secretary-general at FICCI inaugurated the show by introducing the panellists for the Foodworld India 2021 Global Convention for Food Business and Industry, which will be held in six sessions over two days – 24-25 March 2021.

The panellists of the first session included Hemant Malik, chair, FICCI Food Processing Committee and CEO-Food Division, ITC; Siraj Hussain, former secretary, Ministry of Agriculture and Food Processing Industries, Government of India; Manoj Joshi, additional secretary, Ministry of Food Processing Industries, Government of India; and Mohit Anand, co-chair, FICCI Food Processing Committee and MD, Kellogg’s India.

FICCI’s deputy secretary-general Jyoti Vij moderated the opening session, which touched upon the various challenges and achievements of the food processing industry and the changing consumer behaviour in the segment.

Vij said that the conference will have a wide cross-section of the industry from across the country and outside India. “On the sidelines, viewers can also visit India’s first virtual research and development exhibition on the Indian food processing sector on the same virtual platform. It is a programme by the Ministry of Food Processing Industries.”

She added that the virtual R&D expo will be seen in this forum and other similar forums that FICCI will be conducting in the future.

The session started off with Malik announcing the total number of participants during the first few hours of the virtual show. “In this 13th edition of Foodworld India, I’ve been told that almost 1,350 participants have logged in. That is the beauty of the virtual world. There is no limit to space in the conference room.”

Malik said that the forum has evolved as a source for originating thoughts for policy formulation and also a good reflector of the sector. He later outlined the context of the next two sessions of the day, and the other three sessions, which will be taking place on 25 March 2021.

“We believe that in the Indian food market, packaged food is just about 10%-12% of the total opportunity,” Malik said. “But I think we are sitting on huge opportunities.”

Malik said the inclusion of the food processing industry in the production-linked incentive schemes of the government’s Vocal for Local initiative was a welcome move. A budget of around Rs 12,000 crores have been allocated for the same. “I’m sure all of us would be very keen in terms of how we can take this incentive forward and become a global player,” Malik added.

Citing a Nielsen report, Malik said the industry is returning to normalcy. However, he cautioned about the spike in commodity prices. Prices of edible oils, which are one of the major commodities in the food processing industry, have shot up by almost 70% since the beginning of the pandemic. Meanwhile, prices of packaging materials such as laminates and carton boxes have risen by around 50%, thanks to the crisis faced by the paper and paperboard industry.

“This is going to impact pricing,” Malik said, adding that inflation will be carried over to the product pricing, which should be considered to analyse the volume growth.

“We are facing a paradigm shift due to the global demand for food safety, for increasing food security, and for higher quality and sustainability in the reliability of supply chain,” he said. “This becomes even more critical post-Covid-19. We also have noticed a fair amount of changes in the consumption pattern. We saw a huge uptick in ‘immunity boosting’ products.”

“We also found that the awareness of health and wellness and evolving lifestyle changes is something that is going to transform the packaged food industry. A lot of unpackaged food will move towards packaging,” he added.

He said there has been a rapid shift in consumer behaviour and even in eating habits. However, on-the-go consumption has been down by 20-30%.

According to Nielsen data, almost 3,500 new products were launched in the food space during the pandemic situation itself. And almost half of it focused on the health and hygiene arena. “So, the market and manufacturers are responding to the changing trends and demand of consumers,” said Malik.

He said that new trends in sustainability, health and wellness, and convenience are some key pillars that will drive formulation, packaging and marketing in the food and drink industry.

He also noted the role of FSSAI for coming up with very clear regulations so that the entire packaged food could be part of essential commodities. “More importantly, it must be noted that the global benchmarks that FSSAI is bringing in to make sure that India food products and standards are similar to what the global benchmarks are,” he explained.

Touching upon the topic of plastic usage, Malik highlighted that packaged food cannot survive the test of time without making sure that it needs to have a shelf life between three to six months. Calling plastic a ‘wonder material’, he said it allows a product to reach the length and breadth of the country without getting spoiled. “It is a very important ingredient.”

“However, we as producers, brand owners and consumers should work towards the extended producer responsibility (EPR) initiative. We need to focus on increasing recyclability,” Malik said. “We need to provide clarity. Consumer education is the key here, as the collection process is based on segregation, which begins at household.”

Meanwhile, Hussain said that India has a relatively small market for processed foods, and a number of factors afflict the food processing industry.

“The third level of processing is done by corporates. In this, the form or the shape of primary products undergoes significant modification and a much higher value is added to them,” he said. “From this secondary (also called tertiary) processing, products such as bread, pasta, noodles, breakfast cereals, ketchup, and juices are manufactured by corporates and marketed to the public.”

However, Hussain foresees the main change in this sector will be coming from the FSSAI. Hussain suggested that FSSAI has to enable the food processing industry to come up with new products that cater to the taste of a large segment of the population. Frozen peas, noodles, dosa and idli powders are examples of successful innovation by the processed food industry

Joshi spoke about the need to invest in creating demand for highly processed but nutritious food products, which are affordable as well.

“If processed food in the perishable segment is more expensive than fresh produce, consumers won’t buy it. For instance, people would not buy tomato puree, if it is more expensive than the vegetable itself,” Joshi said. "Processed food prices are higher in India. So, how do we reach out to larger consumer segments? This is what the industry and the government have to address."

“One solution is that we can reduce the price margin between what the farmer gets and what the consumers pay for fresh produce. Even if we are able to reduce the price margin by 20%, it would double the farmers’ income,” he added.

Anand ended the session with a vote of thanks to the panellists.