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FOOD PROCESSING SECTOR OVERVIEW

Statistics, news & updates: everything you need to know about the Food Processing Industry in India

Food Processing Industry of India - Maier Vidorno Altios India

Summary/Snapshot​

Food Processing Industry

  • The food & grocery retail market in India constitutes almost 65% of the total retail market in India.
  • India’s food processing sector is among the World’s largest, and output is expected to reach $535 Billion by 2025-26.
  • The industry employs 1.93 million people.
  • The sector is growing at an Average Annual Growth Rate (AAGR) of around 10.00%
  • FDI Received in FPI Sector for 2020-21 is US$ 393.41 million.
  • Food grain production is 29.77 million tons more than the average food grain production of the last five years.
  • The total geographical area of India is 328.7 million ha and the Gross Cropped Area is 198.4 million ha with a cropping intensity of 142%.
  • India’s agricultural and processed food products exports were up by 13% to $ 19.69 billion in nine months of the current fiscal (2022-23) compared to the same period last year.
  • India’s sugar exports grow by 291% since 2013-14, Sugar exports exceed 10 Mn tons for the first time. Sugar exports rise by 64.90% during 2021-22 alone.
  • For Priority Sector Lending, loans to food and agro-based processing plants, as well as cold chains, have been designated as agriculture operations (PSL).
Food Processing Graph - Maier Vidorno Altios India
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Growth Drivers​

  • India has a consumer base of over 130 billion people. By 2030, annual household consumption will treble, making India the 5th largest consumer globally.
  • To enhance India’s Manufacturing and exports $146 million is committed under Production-Linked Incentive (PLI) Scheme in Food Products.
  • 41 Mega Food Processing Parks, 353 Cold Chain projects, 63 Agro-Processing Clusters, 292 Food Processing Units, 63 Creation of Backward & Forward Linkages Projects & 6 Operation Green projects across the country have been approved.​

Sub industries

  • Animal food & feed
  • Beverages – Alcoholic & Non-alcoholic
  • Breakfast cereals
  • Coffee & Tea
  • Dairy products
  • Frozen & Preserved food
  • Ingredients & Condiments
  • Sugar, Bakery & Confectionery products

Opportunities

  • Dairy is the single largest agricultural commodity, accounting for 5% of the national economy and growing at a compound annual growth rate of 6.4 percent over the last five years.
  • Due to India’s fast urbanization, there is a growing need for chicken products, with urban regions accounting for 80% of poultry and meat demand.

Challenges

  • Gaps in supply chain infrastructure: Inadequate primary processing, storage and distribution facilities. Lack of mechanization, high seasonality, perishability and lack of proper supply chain results in a lack of availability of raw material.
  • Infrastructure Bottlenecks: More than 30% of the produce from farm gates is lost due to inadequate cold chain infrastructure.
  • Informal Food Processing Industry: Unorganized segments account for almost 75% of all product categories.
  • Low-Value Exports: Most processing in India can be classified as primary processing.
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Key Investment Opportunities

  • Fruits and vegetables: juices, jams, jellies, purees, soups, powders, dried vegetables, flakes, shreds, and ready-to-eat curries, as well as preserved, candied, glazed, and crystallized fruits and vegetables.
  • Fermentation preservation of food: wine, beer, vinegar, yeast preparation, and alcoholic beverages. Fruit-based and cereal-based beverages are available.
  • The government’s focus is on supply chain-related infrastructures such cold storage, abattoirs, and food parks, and this segment provides investment potential in food processing infrastructure.
  • For 728 districts across the country, the One District One Focus Product (ODOFP) program covers agricultural and associated products.

 

Recent Developments

  • The Production Linked Incentive(PLI) Scheme- to modernize and enhance the competitiveness of the food processing industry by manufacturing specific categories of food products having a high potential for growth in output and value addition for a period of six years till 2026-27.
  • India’s food processing market may touch $470 bn by 2025. Tier-II and Tier-III cities could mirror the trend visible in metropolitan areas, by consuming more processed food in the coming years.
  • Ultra-High Temperature (UHT) processing and aseptic packaging involves producing dairy products with a longer shelf life.
  • Scraped surface heat exchangers, higher pasteurization and modernized mechanical systems.

Key Players in India

National

  • Parle Agro
  • Mother Dairy
  • Vadilal
  • Amul
  • Pepsi​Co, Inc.
  • Unilever​
  • MTR Foods
  • Haldiram’s
  • KRBL Limited
  • Godrej Beverages And Foods Limited
  • Kwality Dairy India Limited
  • Patanjali
  • Dabur India Ltd.

International

  • Kissan​
  • Britannia
  • Nestle​
  • PepsiCo, Inc.
  • Smithfield Foods
  • The Hershey Company
  • Tyson Foods
  • Kellogg
  • Oetker Group
  • McCain Foods Ltd.

Map Clusters

Food Industry Map - Maier Vidorno Altios India
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