April 9, 2021
Cargill India Pvt Ltd perceives Asia as the main growth region in the coming period with China and India being the “growth-centric” ones.
Simon George, President, Cargill India says that China accounts for a substantial percentage of Cargill’s global business which has a turnover of $115 billion. And India is correspondingly vital with its economy set to become $8 trillion by 2030.
India has become a focus market for the US global food corporation and would witness a significant change in size in next 3-4 years.
Cargill, which had begun its operations in India in 1987 by setting up a liaison office in New Delhi, has made rapid strides since then. Currently, the US firm has a mix of business in India spanning across commodities trade, agricultural supply chain, edible oils and fats, animal nutrition, bio industrial, starches and sweeteners and trade financing.
The business-to-consumer presence in India is unique model Cargill has adopted for the Indian market, different from other worldwide markets where it is present. Of course, local and global acquisitions have helped Cargill grow in India.
The Cargill India President said that Bangladesh has become a strategic market for Indian companies. “Bangladesh, as a country, is doing well and its economy has done well in the last 10 years,” George said.
A lot of Indian companies are doing business in the neighboring nation. India could become a manufacturing destination for Bangladesh, which is emerging to be an exciting market, he said.
Last year, Bangladesh imported significant volume of non-basmati rice, corn and wheat from India. “Now, Bangladesh has emerged as a biggest buyer of Indian corn,” the Cargill India President said.
Cargill on grain business side has been acquiring corn (maize) in Rajasthan, Bihar, Madhya Pradesh, Maharashtra, Karnataka, Tamil Nadu, Andhra Pradesh and Odisha.
Cargill has become one of the biggest sources for corn and value-added products produced from corn. The company is also exporting corn to South-East Asian countries such as Vietnam and Malaysia.
The US multinational firm had set up a storage for corn, a first in India for Cargill, in September 2019 with a capacity of 60,000 tonnes at Davanagere in Karnataka. This has been set up next to the corn processing plant started in 2016.
“We have brought the best of global knowledge for storage, so that the corn is chilled and has the right aeration to ensure a longer shelf-life. We want to support farmers by helping them store their produce in best-in-class conditions and getting better prices,” he said.
Cargill has also begun producing starch derivatives in three centres across India. Starch and its derivatives play a key role in food processing industry. “We buy corn from local farmers and are processing it to take finished goods to global customers across Asia,” George said.
A key sustainability feature of Cargill’s operations in Davangere is that 85 per cent of the plant’s power requirements are met through solar and wind energy, says the Indian arm chief proudly. We are looking at similar initiatives across our plants in India as well.
Cargill’s latest undertaking in India is its entry into the cocoa and chocolate business and India is one of the fastest growing chocolate markets, among the top three globally witnessing a high growth rate. Consumers here are seeking unique flavours, taste and textures; yet per capita consumption of chocolate is still low in India compared to global markets. We want to cater to this growth potential in India,” George said.
“In collaboration with our Indian partner, we will produce 10,000 tonnes of compound chocolate and enter the business-to-business (B2B) market by July-August this year. World-wide, we are a B2B company,” George said, adding Cargill’s chocolate business in India will also focus on this segment. “We will help our B2B customers operating in the business-to-consumer segment deliver premium chocolates to consumers in India.”
“We will provide compound chocolates to large confectionery customers, bakeries and ice cream manufacturers. Cargill will also help customers tap into its research and development network of food scientists and experts for product innovation,” he said.
George said that Cargill’s edible oil business both as a bulk importer and leading branded cooking oil player in the country, forms a significant part of the company’s business.
“We established our edible oil business 20 years ago and created a brand. We have expanded in well in the north and west. During Covid-19, we witnessed good consumption at homes. With a health focus, our brands like Gemini and Leonardo olive oil are doing well,” he said.
Even during bad times when the economy registered a negative 23 per cent growth, Indian agriculture witnessed positive growth mainly since the global food supply chain was maintained.