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Mango chained! Covid, lockdown pulp mango growers.

Date: 29-04-2020
Subject: Mango chained! Covid, lockdown pulp mango growers
The Covid-forced lockdown has plunged mango growers across the country in deep despair. Limited transport options, low demand from pulp-manufacturing companies and a severe shortage of labour have forced orchard owners to leave ripe yellow fruits on trees for birds to gorge on.

India lives through its hot, brooding summers consuming close to 20 million tonnes of mangoes every year. They also guzzle over 100 crore litres of mango fruit juices – many of which are manufactured by companies such as Parle Agro, Coca Cola, ManpasandNSE 4.20 % Beverages and Paper Boat. With a lockdown in place, cultivators are not able to transport raw / ripe mangoes to prominent trading hubs across the country.

"Large mango cultivators - with good sales network - will still be able to withstand the lockdown shock; small growers are facing a lot of trouble," says Ved Raut of Raut's Alphanso Mangoes, a Ratnagiri-based cultivator and trader.

A significant portion of mangoes are also bought by food processing companies to make mango pulp – a main ingredient in mango drinks. Not many food processors have approached farmers for additional mid-summer purchases this year.

“Like other FMCG products, the mango-based beverage market has also been significantly impacted - especially with the closure of retail outlets,” says Nadia Chauhan, joint MD & CMO, Parle Agro, the manufacturer of Frooti.

“Currently, trade is operating through a few large format stores in select areas as well as through e-commerce and digital solutions providers,” she adds.

India’s best quality mangoes have been fetching prices between Rs 1200 and Rs 2000 (per dozen) over the past few years. This year, best grade mangoes are available at farm-gates for Rs 600 – Rs 800. But even at this price, there are not many middle-men (traders / brokers) to take them to key markets.

“Luckily for mango-growers, this is not a bumper crop year,” says S. Insram Ali, president of Mango Growers Association of India.

“But then, lesser yield is not good news in times of lower prices. Farmers will lose money on both counts – price and quantity. This year is going to be a washout year for mango-growers. There’s no export happening, domestic sales are tepid and there’s low demand for mangoes from food processors,” he adds.

Regional associations such as the Devgad Taluk Mango Growers Society are now trying to sell directly to consumers by taking orders online; but this is also getting hampered on account of non-availability of trucks, higher transportation cost and absence of courier services (for smaller orders).

“If we’re able to reach mangoes to customers directly, we’ll be able to pocket Rs 400 – 600 for a dozen. By doing so we’ll also be able to eliminate the middle-men,” says Ajit Gogate, chairman of the Devgad Mango Growers Society.

“We’re trying the online route now as older channels are not operational or effective during because of the lockdown,” he adds.

Ved Raut concurs with Gogate: "We're getting direct orders from retailers now; this is helping us for better price discovery. We're getting better price than what we would have otherwise managed from middle-men. But then retailers are only approaching large cultivators. Small growers are still at the mercy of a few market-makers from Mumbai," Raut says.

The juice market in India can be broadly split into two categories on the basis of ‘fruit content.’ Brands with (upto) 30% fruit content hold about 50% of the market share while juices with (almost) 100% fruit content corner about 40% share. Among all fruit juices, mango commands the largest market share at over 60%.

“If you take mango drinks across all price points (from Rs 5 to Rs 90 per unit), the value of this segment could run into a few thousand crores,” says Abhishek Singh, director, Manpasand Beverages, which sells the ‘Mango Sip’ brand.

“The mango juice season is between April and June – when 60% of the sales happen. This year is most likely gone with all this Covid scare and lockdown. We’ll not have to focus the mini-festive season starting with Diwali,” he adds.

Mango drink manufacturers such as Parle Agro, Coca Cola and Manpasand are well-stocked in terms of raw materials; their worry is not being able to reach their products to end-consumers. Manpasand’s Mango Sip sales has dropped one-tenth post the lockdown. Parle Agro is only able to supply its products, which also includes Frooti, to 10,000 of its 20 lakh outlets.

“While e-commerce is also picking up in a big way with our products showing a healthy growth rate of 300%, it is still an under-penetrated channel from a consumer point of view,” says Nadia Chauhan.

Large players may start engaging with mango cultivators in the post-lockdown phase. Juice manufacturers and food processors are asking empanelled mango cultivators to “pulp-and-stock” this season’s produce. “We’ll reach out to farmers once we get a fix around our future demand,” says Manpasand’s Singh.

“The lockdown has impacted additional purchase as per the normal mango purchase calendar. Inspite of this we are very optimistic for the future,” adds Chauhan.

Prominent players like Coca Cola have told ET that they will find ways to support Indian fruit farmers in the months to come. "One initiative is to add fruit juice to some of our carbonated beverages," says the company official.

This, probably, is the first time in several years when large beverage manufacturers have not launched new products to capture a larger pie of the market. A good number of these new product launches came in the mango juice & cream space.

“We had plans to launch a new flavor to our existing mango-line, but have stalled it for now. We’ll launch it in November or early next year,” says the marketing head of large beverage manufacturer.

Clearly, these are not the best of times to say - keep calm and eat aam!

Source:- economictimes.indiatimes.com

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