China's Silent Revolution!-Is it a sustainable strategy?

Communist China of to day is poised to take on the US as numero ono  power in the world with its rapid industrialization and unbelievable agricultural achievements and no matter what human right activists say about the cruelty of the regime that rules the country, the living standards of people there are leap frogging each year. The GDP has seen a consistent growth of about 8- 9% which no other country in the world could achieve for a century. The strategy of inviting foreign investments into the country with technology transfer preconditions has seen localization of many of them producing goods at costs much less than what is prevalent in other parts of the world. Recent news that China is fine tuning another strategy to mimic what it has done in the manufacturing sector to increase production of agricultural crops dramatically using foreign technologies and foreign companies. Small farmers are being pushed out of their lands and land consolidation is taking place at a frenetic pace. Large agricultural farms using latest equipment and technologies are being set up and in a few years time this country may be the largest supplier of food to the world. Here is a report on this tectonic shift in agricultural front in China and its impact on the food supply in the world. 

"As the largest international market for food and agricultural products produces in America, China represents an estimated 20% of farm exports for the U.S. But thanks to the U.S., that lush market is undergoing the biggest transformation in decades — one that will send ripples throughout the global economy. What does this revolution look like? The Chinese government has been gradually pushing the country's agricultural sector toward large-scale farming, as the march toward industrialization has been turbocharged in both government policy and foreign investments.  In recent years, the country has replaced small farms with larger plots of land and mega-sized operations. Farmers and entrepreneurs are also receiving industry advice from an unlikely partner: Iowa agribusiness. Across the country, U.S. companies are investing in high-tech hog farms, selling equipment made by Deere & Co. and boosting production of China's largest crop with genetically modified seeds. The results are astonishing. China's total farm output has tripled since 1978, helping slash its hunger rate from 20% of its population in 1990 to 12% today, according to research by the UN Food and Agriculture Organization and the Organization for Economic Cooperation and Development. The pace of the revolution is gaining speed as millions of people leave farming for a job in one of the country's numerous megacities. The government in Beijing is encouraging the mass scale migration as it plans to move 100 million people from rural, agricultural heartlands and into urban areas by 2020. Increasingly, unattended farms are being replaced by U.S.-inspired agricultural innovations: big farms, chemically intensive production, monoculture crop systems and modern technology. "More and more farmers see agriculture as a secondary job. Some farmers no longer attach importance to growing crops as they used to," Minister of Agriculture Han Changfu said in an interview with Xinhua last Friday, the China Times reported. But the government has other, unsaid motives. Not only will mass migration support economic growth, it will also transfer rural land, normally under collective ownership, to government control."

Migration of rural population to urban areas is a phenomenon found in most of the developing countries as small scale agriculture becomes more and more nonviable economically leaving very little option to the rural folks but to migrate to cities seeking better income earning opportunities. In India itself the rural population is coming down rapidly and the urban infrastructure all over the country is literally bursting at its seams due to uncontrolled influx of rural folks. What is alarming is the impact of such a trend on the agricultural front, especially on food production. It is an irony that millions of small land holdings resulting from land fragmentation happening due to successive generational shift cannot adopt modern agricultural practices which only can increase land productivity. As land is a holy cow in the country land consolidation by private players is practically impossible ensuring status quo in the food front. Though one hears about new policies aimed at land consolidation by thrashing some of the archaic laws that prevent any land reforms, nothing seems to be happening at the ground level. India needs to take a lesson out of the Chinese experience and go ahead in transforming small agricultural land holdings into reasonably big entities which can only take up modern technological means to expand food production  

significantly in the coming years. 
V.H.POTTY
http://vhpotty.blogspot.com/
http://foodtechupdates.blogspot.com

NEW AGRI-TECH STRATEGY OF THE UK- BETTER LATE THAN NEVER!

R & D is such a broad area that many scientists and technologists engaged in this endeavor often fail to understand the real purpose of their effort viz to come out with workable and viable technologies with mass production potential. While research on basic science generates ideas developing the finding further through integrated efforts of scientists and engineers lead to development of feasible technologies. Majority of technological developments do not go beyond the four walls of the laboratory, getting no opportunity for productionization. Technology can stall if its transfer to the field is not properly managed after establishing its viability at the lab level. Here is where most universities and R & D institutions fail. Against this background the recent strategy being put in place in the UK to integrate the efforts of various stake holders in agriculture and food processing deserves applause. Here is a take on the intent and objectives of the action plan enunciated by the UK government in a recent document. 

"The UK will become a world leader in agricultural science and technology following the launch of a new strategy to deliver sustainable, healthy and affordable food for future generations. Breakthroughs in nutrition, informatics, satellite imaging, remote sensing, meteorology and precision farming mean the agriculture sector is one of the world's fastest growing sectors. Developed in partnership with industry, the Agricultural Technologies Strategy will ensure everyone from farmers and retailers, to cooks and shoppers share the benefits these exciting opportunities bring. It includes a £160 million government investment in developing cutting edge technologies, and taking innovative products such as cancer-fighting broccoli from the field to the shopping aisle. Industry is also expected to invest heavily in the strategy which will transform farming in the UK, using the latest technologies to ensure the process is as productive as possible whilst reducing environmental impact and resource use. With the demand for food rising rapidly worldwide, the strategy also aims to make the UK a world leader in addressing global food security issues. Agri-tech is a well-established and important UK sector. The entire agri-food supply chain, from agriculture to final retailing and catering, is estimated to contribute £96 billion to the economy and employ 3.8 million people. Universities and Science Minister David Willetts said: Some of the biggest brands in farming and food are based in the UK. We have a world class science and research community and our institutes and universities are at the forefront of agricultural research. To get ahead in the global race, this strategy sets out how we can ensure that we turn our world-beating agricultural science and research into world-beating products and services. This Agricultural Technologies Strategy follows the recent plans for automotive, construction, aerospace and other key sectors to secure sustainable future growth in the economy. Defra Minister for Science Lord De Mauley said: We face a global challenge to feed the rapidly increasing population in a way which is affordable and sustainable. We are investing in technologies that will enable British farmers to meet these challenges and take advantage of the growing demand in export markets for British food. To take advantage of agriculture's opportunities and drive growth the Agricultural Technologies Strategy sets out a range of key actions, including: a £90 million government investment in world class Centres for Agricultural Innovation with additional investment from industry. The centres will support the wide-scale adoption of innovation and technology across key sectors, technologies and skills in the food and farming supply chain. This includes up to £10 million for a Centre for Agricultural Informatics and Metrics of Sustainability which will use data from farms, laboratories and retailers to drive innovation creating a £70 million Agri-Tech Catalyst to help new agricultural technologies bridge the so called 'valley of death' between the lab and the marketplace. Co-funded with industry, the catalyst will specifically support small and medium sized enterprises. The investment includes £10 million to support the transfer of technology and new products to developing countries, the creation of an industry Leadership Council to unify the agriculture technology sector and make the UK more internationally competitive the recruitment of a new UKTI agri-tech team to boost exports and overseas investment in the UK's agricultural technologies".

Of course declaration of intent is one thing and implementing the same is another thing. How far the government will be able to weave together the different but related players for a cohesive and integrated team is a million dollar question begging for answer. The most important part of the strategy is to set up the Agri-Tech Catalyst for facilitating the growth of the small and medium enterprises which are generally starved of technical support because of their limited resources unlike the Big Fish with deep pockets and high risk taking capacity. The intention to facilitate transfer of technologies to developing countries is to be applauded though export of products from the UK to these countries may not be feasible to any great extent. All said the strategy looks excellent on paper but there is a nagging suspicion whether the budget is a little too short to achieve all that is aimed at. If this will raise the stature of the UK as a technology giant it is good for the country.  

V.H.POTTY
http://vhpotty.blogspot.com/
http://foodtechupdates.blogspot.com

SCENTED DINNERS-A NOVEL APPROACH FOR ENHANCING DINING EXPERIENCE

Stimulating appetite and attracting customers through typical aroma of foods being cooked is an age old strategy and many restaurants and bakeries do resort to such techniques to boost their business. Some super markets even use familiar aromas through their air conditioning ducts which will pervade through the aisles of the shopping area. It was not long ago that Hot Shops were a rage where people could wait for their fresh bread and bakery products to be delivered directly from the oven. People always associate aromas with different foods and therefore using them to tickle the palate is nothing but logical. However using scents different from those associated with foods is a novel approach being adopted by some chefs as a part of their presentation style. Here is an instance of a renowned chef using such a technique to enhance the eating pleasure which may catch up diners looking for new experience.

"There are no flowers or wine glasses on Chandler Burr's white linen–draped dinner table. Nothing ruins a pure raw scent like a brazen floral invasion or the aromatic bouquet of fine wine. There are no distractions at Burr's table at all—no colors, no decorations, no noise—just a blank slate on which the senses of smell and taste are laid bare, gently teased to the surface. Smell, when done right, is a very sensual experience. But smelling one's way through dinner is not about catching a whiff of sautéing garlic or grimacing over a Gorgonzola. It's about identifying an essence—the soft skin of a peach, the ruddy leaf of a fig tree, the earthy peel of a carrot—first through the nose and then, long lingering moments later, through the mouth".

It is said that consumers eat a food first through their eyes, then with the nose and finally through their oral cavity. Walking through the aisles of a super market the consumer is drawn to shelves where highly attractive packaged items, followed by visual dissection from close quarters before deciding to buy those items most satisfactory. Of course repeat purchase happens only after taking the packet home and tasting the contents. In contrast visiting a restaurant and deciding on the items on the menu depend entirely on reputation of the quality of foods served there. Just like the eating experience which is registered in the minds of customers, the new technique of using scents to attract customers has an inherent surprise element in that one cannot have a predilection about the experience waiting for him. According to the practitioners of this "art" this mode of dining provides both olefactory feast and gastronomical delight in one go!

V.H.POTTY
http://vhpotty.blogspot.com/
http://foodtechupdates.blogspot.com

BETTING ON INDIA-NESTLE' S NEW STRATEGY FOR GROWTH

The food industry landscape in India is dominated by a few multinational companies are their subsidiaries which have more than 60% of the share of business in the organized sector. Nestle India which is the subsidiary of the Swiss giant Nestle is a dominant player with a range of products that can be the envy of any established company working in the food area. The Maggi noodles which was introduced about 2 decades ago to a population totally alien to this products is to day a house hold product with practically every child hankering after it and no competition has been able to touch the preeminence it enjoys in the Indian market, though adults identify the company more for its Nescafe brand instant soluble coffee. With many competitors nibbling away its market share during recent times, Nestle seems to be looking for diversification for increasing its business volume with its parent concern pitching in with more investments to expand the operations in the country. Here is a take on Nestle's strategic thinking on Indian operations.

"Currently, Nestle India's products are Maggi noodles, Nestle Yoghurt and Kit Kat chocolates. Nestle India Ltd's announcement comes after a previous announcement last week by its parent company that it would be undertaking a $1.4 billion investment in Brazil, Russia and India from 2010 through to 2012, but Waszyk would not divulge on how much of that amount had been spared for Indian investment acquisitions, rather stating that the company was taking measures to counterbalance the effects of high input costs on profitability. According to Waszyk, the company's chairman and managing director, Nestle India Ltd has its strategies, namely to reduce costs and increase prices according to category, he said in an interview, noting that, whereas the company had increased prices of dairy products, it had not increased prices for products made out of wheat and sugar. Costs have gradually increased with an increase in the prices of milk, sugar and wheat, subsequently resulting in a net profit for the first 2010 quarter, ended March 31st to rise by a slow 2.5% on year to peak at $43.5 million. Thus, according to Waszyk, whereas Nestle India Ltd will seek to grow its sales volume in India via investments and new products launch, it will try maintaining an operating margin by reducing production costs. For more information visit http://www.investinindia.com/industry/food-processing. The Indian subsidiary of the Swiss Food Giant is estimated to have a net worth of about Rs 5,150 crore and with the announcement, its chief target is to ensure that India's contribution to global sales, currently at record lows, increases considerably".

What concerns impartial observers is the plan for acquisition of successful Indian firms which can only lead to stifling the competition and raising consumer prices eventually. India presents a paradoxical situation to the multinationals as there are hundreds of traditional foods popular in the country and many of these companies have no clue regarding the expectations of the indigent population vis-a-vis their flavor and taste preferences. Earlier attempts by some large companies to acquire some of the industries dealing with Indian snack products were not successful as many of the local companies are owned by families with third and fourth generation owners unwilling to sell their operations on sentimentality. Major acquisitions like Parle soft drinks by Coco Cola and Uncle Chips by Pepsi were done long ago and it is doubtful whether Nestle's plans are going to succeed this time.

V.H.POTTY http://vhpotty.blogspot.com/ http://foodtechupdates.blogspot.com

"BRIC" STRATEGY-COMBATING HUNGER THROUGH COOPERATION

Associations of countries in any form is supposed to provide a collective forum for consultation and cooperation in areas of interest common to the member countries. United Nations Organization and its many affiliated agencies formed after the last world war have almost all independent countries as members and one of the biggest achievements has been prevention of another world war for the last 60 years. There are many regional groups like ASEAN, SAARC, BRIC etc formed specifically to protect the common interests of countries bound by some well defined objectives. India which is a member of BRIC, a loose grouping of Brazil, Russia, India and China, is hoping to be benefited by the strength of other member countries in many areas of critical importance to its growth and development. The most recent meeting at Moscow, focusing on agriculture can herald a new era if member countries take the deliberations seriously.

"I feel that Bric has huge potential for cooperation in combating hunger and ensuring food security through coordinated approaches in modernising farming and inducting environment-friendly technologies," Pawar said at the end of his three-day visit to the Russian capital during which he attended the maiden session of the Bric agriculture ministers. The summit of the leaders of the four fastest emerging economies on April 16 in Brazil will be briefed on the outcome of the first-ever meeting of the farm ministers. Pawar said the experts group set up by the Bric farm ministers yesterday to help combat hunger and climate change will comprise the heads of the relevant institutes of the four-nation informal grouping.

It is refreshing that in an era of secrecy and intellectual property rights dominating the business landscape across the world, the four most populous countries representing more than 60% of world population are coming together and resolve to cooperate for the benefits of their population. The BRIC summit, coming up in April this year must give definitive shape to concrete action oriented programs with achievement mile stones to be achieved with in a short time frame. It should not degenerate into a photo-op session, wasting the time and dousing the aspirations of people yearning for food security and peaceful co-existence.

V.H.POTTY

http://vhpotty.blogspot.com/
http://foodtechupdates.blogspot.com