Free Press Journal

Cold-chain is the supply chain system for perishable items: NCCD CEO Pawanexh Kohli


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Mumbai: From increasing exports to accelerating food processing, to increasing efficiency in farm, are usually considered as enablers to double farmer’s income. But none of this will be possible unless you have a mechanism to maximise the nutritional value of agricultural output, and minimise losses as well.

Food loss occurs, not due to lack of storability, but when food does not reach consumers or comes to gainful end-use. In order to tackle concern about food loss, there is a need to organise agri-logistics (including cold-chain), which alone can ensure that produce is delivered to end consumers, stated CEO of National Centre for Cold-chain Development (NCCD) Pawanexh Kohli.

Such food losses can be anywhere between 15 per cent and 40 per cent. According to the Committee for Doubling Farmers’ Income (DFI) report, the loss in the farm-to-market link segment, whether at 15 per cent or 40 per cent, is an unmistakeable opportunity to add to farmers’ income. As per Food and Agriculture Organization (FAO) and CIPHET reports, compared to countries globally, the food losses occurring in South Asian countries especially in India is lower. However, other estimates by organisations like Indian Council of Agricultural Research (ICAR), state that “the Indian agriculture sector incurs 18 to 25 per cent losses in the entire supply-chain (moving produce),” revealed DFI report.

Without market connectivity, any production is a futile exercise. “Efficient agri-logistics, enhance and extend market reach and linkage of producers, and will be the key to reduce food losses,” added Kohli.  Without such market linkage, the efforts to ramp up agricultural production amount to naught.

He further said, “Cold-chain is the supply chain system for perishable items. Cold-chain is a series of logistical activities that extends the marketable life of a perishable item, buying time with the sole purpose to connect with consumers.” At present, cold-chain is well advanced when used for ice cream, dairy products, and some meats and processed foods in the country. These are the ‘must-have’ segment, where items must have special care. But Kohli believes there is a growing need to realise the importance of cold-chain models for fresh produce like fruits and veggies, especially so that the production can reach markets further afield and capture value for the farmers. “We need a green revolution like the famed white revolution which was led by Dr. Kurien. Thanks to him, we did not create cold stores for milk but a holistic supply chain network.”

“The primary enabler for such a fresh produce network is pack-houses, which would serve as aggregation and pre-conditioning hubs. Equipped with pre-coolers, these should work as points of origin at village level, serving as staging and dispatch centres. Each would utilise refrigerated transport to make the forward connectivity” stated Kohli. “At present India has merely 350 pack-houses, but we need about 70,000 pack-house. This would amount to about one every ten villages, on average.” In a report of DFI, it was stated that lack of pack houses and transport connectivity result in a breach in the integrity of cold-chain. “This also results in most of the cold storage capacity being used to store only crops like potato, dried chillies, pulses, etc. which do not need onwards cold-chain connectivity.” According to NCCD’s 2015 study, in terms on cold chain infrastructure, India is falling short by 10 per cent for cold storage, but there is a gap of more than 90 per cent in ripening units. Meanwhile, there is a massive shortage of 99 per cent for integrated pack houses.

Apart from logistics, market architecture is also critical. The 2018-19 budget takes cognisance of this need and has announce the developing the 22,000 rural haats into Gramin Agricultural Markets (GrAMs). These will be enabled with ability to serve as pooling points, to aggregate, package and dispatch farm produce to distant terminal markets. This will allow farmers to capture higher price for a unit of value produced, and greatly contribute to our national agenda of doubling famers’ income, stated Kohli. This budget not only stimulates a change in the existing market system, it also inspires the farms to collaborate as a cluster. There is immense focus to promote collective forms of farming, so that farmer groups can function as producer companies and village scale producer organisations are promoted.

Collaboration in the supply chain is the essence of all sustained economic growth. The much touted fragmentation of Indian farms is not so much the problem, as much as the fragmentation in planning and managing logistics loads. For this, farmers have already started collaborating to function in a collective manner.

“We also have an expansive front-end, that also operates on a hub and spoke design,” Kohli believes. “I believe each vendor or retailer, seek to optimise their selling cycle to minimise non-saleable losses. This is better managed with sales forecasting and inventory management. One should not expect a hawker with a small cart to require a refrigerating system installed in his cart. It would not just burden their mobility and impact their selling model, but require them to secure or transport their cart home, so that the system is not tampered with. “Such ideas need to be evaluate better, with a holistic systems approach,” stated Kohli. “Nevertheless, the government also incentivises the modernisation of all types of vending platforms.” “This will not only save them individual cost on daily fuel for procurement, but also time and effort of the vendors. This will add to their quality of life and allow small and medium vendors to make better margin.”

(Free Press Journal and Moneycontrol are organising a panel discussion on Cold Chain Solutions for Tomorrow’s India, on Friday, March 16, 2018 at 5:00 pm. Venue: IMC, Walchand Hirachand Hall, 4th floor, Churchgate, Mumbai – 400020)

Pankaj Khandelwal, MD, INI Farms
Pawanexh Kohli, CEO, NCCD
Kiran Malla, Director, Corporate Finance Strategy, EY
Ravichandran Purshothaman, President, Danfoss
B Thiagarajan, Joint Managing Director, Blue Star Limited

Moderator: R N Bhaskar, Consulting Editor, FPJ

(RSVP: Harish Tiwari:

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