IndiaNews. FOOD & FOOD INGREDIENT REVIEW December 2006 January 2007 CONTENTS
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1 FOOD & FOOD INGREDIENT REVIEW December 2006 January 2007 CONTENTS p.1 Editorial Food Industry Overview p.3 India can achieve 8 per cent GDP growth till 2020 GDP grows at 9.2 per cent in Q2 Israel mulls FTA with India p.4 GDP growth forecast upgraded Asean doubles its negative list for FTA with India Govt plans to set up 50 food parks p.5 Cold chains set to grow India, GCC FTA likely by 2007-end Aquaculture p.6 Marine sector aims for higher tuna exports p.7 US court rules shrimp bonds unfair USA may cut duty on shrimp imports to 7 per cent p.8 Marine exports to US fall Marine exports up Dairy, Meat & Poultry p.9 Asia replaces Europe as world s top milk producing region p.10 Amul to launch probiotic ice cream ranges Amul eyeing flavored yoghurt mart p.11 Ghee loses aroma in a skimmed milk powder-friendly market p.12 Dairies can't afford to under-price cow milk Govt mulls ban on export of skimmed milk powder p.13 Danone plans to go solo for dairy entry International accreditation for Amul's plants p.14 TN poultries prefer contract farming for maize Poultry sector wants maize futures banned p.15 Ban on egg exports to Middle East lifted Godrej to take Real Good to North p.16 Suguna Poultry to invest in livestock vaccine project Suguna to launch layer breed Israel s largest food co. to enter India Alcoholic Beverages p.17 EU objects to Tamil Nadu ban on foreign liquor US, Australia join EU for cut in Indian duty hangover UP clears proposal for 3 distilleries p.18 Maharashtra goes soft on wine & beer Venky s Rock wine for women p.19 `Food` status accorded to grape wine by MP Strawberry wine from Himachal p.20 UB raises first toast to wine market UB plans liqueur foray Alcoholic Beverages (Contd.) p.21 UB to buy Whyte & Mackay Vodka battle: Poison takes on Smirnoff United Spirits launches Royal Mist p.22 Kyndal forays into wine Champagne Indage buying Tandou winery Seagram India launches Nine Hills Brindco set to buy stake in Grover Vineyards p.23 Wine from arecanut Carlsberg to build brewery in India p.24 SABMiller open to India buys Radico, Vangal eye Amruth IMFL brands p.25 Jim Beam set to launch Indian whisky Diageo to launch Smirnoff Black No. 55 Cobra Beer plans acquisition, greenfield brewery Non-alcoholic Beverages p.26 Coca-Cola to bolster sales force and restructure production capacities Rasna plans manufacturing unit in Israel p.27 Coke to finally flash Minute Maid Fanta in new mix p.28 PepsiCo to take a shot at health Test to detect pesticide levels in colas p.29 Karnataka re-imposes ban on sale of soft drinks Tatas test Everest waters for plunge Dabur turns `Activ`, unveils soya juice p.30 Green Way launches health drink Bisleri on the block again Cafe Coffee Day plans flavored water Contents continued on next page is published every 2 months by: GIRACT 24 Pré Colomb, 1290 Versoix Geneva Switzerland Tel Fax info@giract.com
2 FOOD & FOOD INGREDIENT REVIEW December 2006 January 2007 CONTENTS (Continued) Tea p.31 International tea logo on lines of woolmark Production glut worries global tea players p.32 Brand Darjeeling is up, running now p.33 Tea export earnings slide Tea production likely to suffer in the Nilgiris due to frost p.34 Significant growth in tea exports to Pak Jan-Nov tea output up Himalaya herbal teas make a come-back p.35 McLeod Russel to buy stake in Moran Tea Tata Tea to bring in new formats for Tetley p.36 ATG plans to bring UK s Typhoo Kannan Devan targets growth p.37 HLL, Pepsi review ties Coffee p.37 Coffee crop may be below target Coffee earned more in 2006 p.38 Specialty coffee exports stage recovery p.39 Lavazza readying to smell Barista coffee; others in queue Starbucks to make single-brand retail foray into India p.40 UAE's Abbasi Group to open coffee outlets Dabur to enter hospitality sector Cafe Coffee Day opens in Pakistan Arabica coffee to go up Food Service & Retailing p.41 Fast food chains all set to fly Sector-specific FDI likely in multi-brand retail 'Retail mart to zoom to Rs bio by 2010' Retailing bug bites Munjals p.42 Bharti lines up USD 7 bio for retail Bharti-Wal-Mart deal conforms to FDI norms National rollout for ITC s Choupal Fresh p.43 Subhiksha to open more retail outlets in Delhi Shoppers' Stop forms JV with Swiss firm Subhiksha on expansion spree Pantaloon to open 75 more Food Bazaars p.44 Reliance Retail plans takeovers to dwarf competition Heritage Foods forays into retail p.45 Kumar Birla to jump on retail bandwagon Kumar Birla averse to foreign tie-ups for retail biz Trinethra gives Birlas retail edge Mark Pi plans 300 restaurants Food Service & Retailing (Contd.) p.46 Mall manager Donaldsons plans India foray Metro plans pan-india spread Carrefour, Landmark plans may not take off p.47 Suguna Poultry launches fast-food chain Future Group to launch Big Bazaar Clubs Spinach plans for 1500 stores Snacks p.48 HC restricts Danone on Avesthagen stake Britannia to share data with ABIH p.49 Danone to return 'Tiger' to Britannia Group Danone may divorce Wadias p.50 Wadias set to upset Danone s India plans Sarda group to expand snacking products basket Britannia to buy stake in Middle East group p.51 Vanilco looks to manufacture chocolates Culinary Items p.51 In US, Indian cuisine selling like hot curry! p.52 Norway company to buy MTR p.53 Chyawanprash gets a makeover with new variants Dabur plans honey plant Dabur Foods plans ready-to-cook foray p.54 Exports of Sarson Ka Saag Catch out for strategic partner p.55 Risotto from Italy Flour for weight watchers Isabgol drops on high output Riddhi Siddhi sets up starch plant in Karnataka Sugar p.56 Cane statutory price fixed Govt mulls biotech-based plan to tap into EU sugar market p.57 Govt partially lifts ban on sugar exports Sugar mills bullish on exports as global prices recover India to have surplus sugar p.58 India may export 1 mio ton of sugar Ethanol buying picking up Maharashtra to dethrone UP in sugar production p.59 DCM Shriram commissions greenfield sugar unit Balrampur Chini to borrow more Simbhaoli commissions greenfield unit p.60 Bajaj Hindusthan net profit up Contents continued on next page Vol GIRACT 2007
3 FOOD & FOOD INGREDIENT REVIEW December 2006 January 2007 CONTENTS (Continued) Oils p.60 Soya meal exports in seen down despite steady beginning p.61 Mustard prices rise 2007 rabi groundnut output may rise p.62 India-Asean FTA slips on edible oil Customs duty slashed on edible oils Edible oil imports fall despite duty cuts p.63 Ruchi Soya races ahead in bid for Sweekar Sanwaria Agro in talks with Australian cos p.64 Nutralite margarine relaunched IICT to set up lipid research center Food Additives p.64 Starch prices may head north on bullish maize p.65 Vanilla prices losing flavor Cocoa output to increase Spices & Flavors p.66 Black pepper exports to US surge Subsidy boosts black pepper exports p.67 Pepper likely to be hot in the current year Pepper imports from Brazil on the rise Pepper prices soften in November p.68 After Sudan Red, rhodamine B plagues spices industry Spice Board wants blanket ban on Rhodamine B dye p.69 Fall in China s chilli output to boost Indian exports p.70 Cumin seed exports may cross 25,000 tons Cumin seed may turn hot p.71 Cardamom output fall moderate Cardamom likely to hit Rs. 450/kg p.72 Rise in import of spices p.73 Domestic Prices Of Major Spices Fruits & Vegetables p.77 Onion prices remain firm as exports rise Rose onion exports rise p.78 Dehydration units hit by rising onion prices p.79 Preserving coconut water - FAO shows the way Coconut output set to jump p.80 Cashew exports drop in value Europe to get biodynamic cashew p.81 India, Pak await US nod for mango exports Potato processing plant in Punjab p.82 Euro Fruits forms JV with European firm HP scientists grow organic mushroom p.83 Pomegranates to be checked for residues Biotech p.83 Apex court concerned over use of GURTs in transgenic mustard p.84 DBT contemplates changes to GM crop field trial regulations Rice gene patent for Avesthagen Major Food Companies p.84 ITC, Marubeni ink deal for food biz p.85 Dabur Nepal shuts herbal unit on security worries Dabur plans manufacturing unit in UAE Related Publications p.86 ChinaNews Foodgrains p.74 Chhattisgarh uproots GM rice from trial plot GM bajra hybrids from Rasi Seeds p.75 Govt allows duty-free wheat import till Feb 28 Wheat output seen higher p.76 US processors eye Indian market Pulses `nil' import duty regime extended Futures trade in two pulses banned Vol GIRACT 2007
4 Food & Food Ingredients Review Editorial A Happy New Year to all our readers Indian economy seems to be throwing up one good news after another. The latest is the report that India's economy grew by a robust 9.2 per cent in July-September Such healthy growth has forced analysts across the world to revise their earlier forecasts. Credit Suisse s chief Asia economist Dong Tao said, India would overtake China next year as the world s fastest-growing major economy on rising consumer and government spending. He opines that the high growth rate of India since 2003 represents a structural increase rather than simply a cyclical upturn and so the country can manage a sustainable growth rate at about 8 per cent until Goldman Sachs agrees with Credit Suisse and goes a step further to say that a growth rate of 10 per cent is also achievable, if the investment rate is boosted to 16 per cent of the GDP. The report forecasts that India's gross domestic product (GDP) will surpass Italy, France and the UK by the middle of next decade (around 2015). It will then overtake Germany, Japan and finally the US before 2050, to emerge as the second-largest economy after China. We do not have any disagreement with Credit Suisse or Goldman Sachs. But, as a habit, we always spice optimism with caution. We have no doubt that in the next few years India will become a motor for the world economy, and a key contributor to generating spending growth. However, we reserve our comments on the forecast about Indian economy overtaking major European economies and even the US. We are not ready to open the bubbly on this as yet. As and when we decide to celebrate with a bottle, there will be no shortage of quality wines for the celebrations. Indian wine industry seems to be at the beginning of a sunrise phase, with new players entering the market, existing ones bracing up or increasing capacities, international players knocking on the doors. India s liquor king, Mr. Vijay Mallya (UB Group), has ambitious plans for the wine industry. Partnering him is the Union Agriculture Minister, Mr. Sharad Pawar. Incidentally, Mr. Pawar s family directly or indirectly controls large tracts of land in South Maharashtra. Mr. Pawar s help can be very useful for Mr. Mallya in entering into arrangements that ensure a steady supply of high quality grapes. (Continued on next page) Vol GIRACT
5 Food & Food Ingredients Review Editorial (Continued from previous page) The two giants Mr. Pawar and Mr. Mallya bring to the table a formidable collection of resources and strengths. With their combined forces, they propose to create a large wine market in a country known for its obsession with whisky. Mr. Pawar s political clout has already started yielding results. Two states Maharashtra and Madhya Pradesh have declared wine to be a food as distinct from alcoholic beverages like whisky, gin, vodka etc. In practical terms this means that it will be possible to sell wine from a supermarket or mall or a grocery shop. Opening a liquor shop in India is very difficult and subject to innumerable restrictions. In some states, liquor shop licenses are auctioned. In some others, only government shops sell liquor. If wine and beer do not have to depend on the small number of liquor shops and can be sold through large number of retail shops, easy availability will create a vast market. Let us hope that Mr. Pawar will be able to influence other states to go the way of Maharashtra and Madhya Pradesh. This would surely unleash a wine revolution across the country. Adding excitement to this unfolding wine revolution are interesting variants like strawberry wine and arecanut wine. To add mystique to the drinks, UB Group brings to you liqueurs from the royal palaces of Udaipur. Many royal families will be watching these liqueurs with interest and may like to introduce their own brands of liqueurs in the years to come. It may be sometime before Indian royal liqueurs make their mark on the international shores. For the moment, the spotlight is on Indian food. According to a study conducted by Promar International, Indian cuisine has shown substantial growth in sales volumes and gained mainstream acceptance in the US over the past two years in the ready-to-eat (RTE) category. That probably explains the interest of Orkla Foods of Norway in buying MTR Foods for Rs bio. MTR has a well-developed range of RTE Indian food products. Orkla may be able to sell these products through its network in the US, the UK, and Australia. These are interesting developments that could reshape the Indian food & beverages sector. Global food companies seem to be discovering India not just as a large consumer market, but also as a source for a unique cuisine and as a manufacturing hub that can deliver high quality at a reasonable price. Increasing maturity of Indian companies, in terms of technologies and materials used, is helping this changing view of India on the global arena. A proof of increasing sophistication of Indian food industry comes from the decision of Amul to introduce probiotic ice creams in the country. With increasing sophistication, one also notices higher levels of assertiveness. European and American companies are discovering this, quite often to their horror. For some it is as startling as hearing a lamb in their lap roar like a tiger. Groupe Danone might be having similar feelings in its spat with Mr. Nusli Wadia over the control of Britannia and the brand Tiger. On one hand, we sincerely hope and wish that Mr. Wadia and Groupe Danone are able to resolve their differences amicably. On the other hand, we advise our readers to acknowledge the increasing confidence of Indian business houses and step with caution in negotiating contracts and joint venture agreements. Vol GIRACT
6 Note: The contents and editorial page given above are excerpts from published by GIRACT. The excerpts have been published by Hindustan Studies & Services Ltd. at the website with due permission from GIRACT. For further details about, please contact or Vol GIRACT
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