Mango pulp business less sweet this year, too | SupportBiz

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Mango pulp business less sweet this year, too

Economic slowdown and unseasonal rains have dealt twin blows to the mango pulp industry in the state of Andhra Pradesh. Many fruit processors and exporters are facing tough conditions this year due to reduced yield and the economic slowdown.

The Chittoor fruit processing cluster is the largest in the country. 90% of the fruit pulp processed here is exported. The Chittoor cluster is a government-designated Agri Export Zone (AEZ). Annually, about 7 lakh metric tonnes of mangoes are converted into pulp here. There are more than 65 mango fruit processing units in the cluster. 76% of the firms are small enterprises, 20% are medium enterprises, and 4% are large ones.

In 2011, India’s first mega food park opened in Chittoor. It offers end-to-end food processing facilities with backward and forward linkages between producers, manufacturers and exporters, and has been set up with the idea of benefiting all the contributors to the value chain.

53,000 hectares of land is under mango cultivation, and mango production is in the range of 5,69,000 tonnes. The major export destinations are Saudi Arabia, Netherlands, Yemen Republic, UAE and Kuwait.

Slowdown impact

The downward trend in mango pulp exports has been continuing since 2011 due to the economic slowdown as well as the unrest in West Asia, according to officials of the Pulp Manufacturers Association.

“In 2011, the movement of stocks slowed down, which reduced demand in 2012.  3-4 tonnes of pulp commonly goes to Egypt, Yemen and nearby countries. The political unrest there has brought business to a standstill,” says Vijendra, a pulp merchant.

With leftover stocks remaining in the warehouses, there is little demand for new stocks. Many small factories are not finding it viable to operate, and are close to closure. Since this is a seasonal industry, there is a floating population of workers. Thousands of workers have no work this year, too. The peak season of operation is from April to July.

Can the government do something to help?

In 2011, the Tamilnadu government included mango milkshakes in the mid-day meals for schools, to help the mango farmers of Krishnagiri district, Tamilnadu. No such move has been made by the Andhra Pradesh government.

According to figures from the Ministry of MSME on the Chittoor cluster, annual turnover in the domestic market is Rs. 125 crore and the export market accounts for Rs. 330 crore.  APDEA sources say that in 2011-12, the country has exported mango pulp worth Rs. 620.80 crore.

J Amarnath, owner of Bhagyalaxmi Fruit Canning Industry, who has been in the business for 30 years, says, “This year, the yield is down by 30% due to unseasonal rains in the state in April. Added to this, the demand is low due to economic slowdown. Our exports are down by 50%. The market is very bleak in Europe. In a good year, 4 lakh million tones of pulp is exported from Chittoor.”

There is a segment of farmers who are demanding that the government open up mango co-operative societies to help farmers tide over difficult times such as these. However, others like Amarnath disagree. He says, “This is a seasonal industry, where the action peaks for about 70 days in the year. During that time, if government officials come around, they will create disturbances in the name of inspections and other proceedures. If the economic conditions improve, business will automatically pick up,” he says optimistically.