Dairy sector takes to tech to beat manpower shortage amid Covid
Dairy farmers and dairy processors have embraced technology amid the Covid-19 pandemic to circumvent manpower shortage and procure milk in a contactless manner.
The dairy sector is expected to make a comeback in this financial year, with rating agency Crisil indicating that the revenue of the organised dairy sector in the country is set to grow 5-6% year-on-year to Rs 1.5 lakh crore after falling to a decadal low growth of 1% last fiscal.
“Right through the pandemic, Stellapps smartMoo digitisation stack enabled dairy processors across the country to procure milk – including grading, pricing and farmer payments – amid lockdown in a contactless manner,” Stellaps CEO Ranjith Mukundan told ET. “Despite disruptions in the supply chain, Stellapps enabled farmers to sell their milk during the pandemic and get digitally paid regularly despite tough market situations.”
He said the company enabled farmers to sell milk using its tech platform and facilitated digital payments and hassle-free credit to smallholder dairy farmers, allowing them to tide over the economic distress brought about by the pandemic.
The company has digitised more than 35,000 villages, touching 3 million dairy farmers and 200- plus dairy processors across India, he said.
According to Crisil, healthy demand revival in value added products (VAP), lower restrictions than in the first wave of Covid-19 and steady demand for liquid milk (65-70% of organised sector revenue) will help support overall growth in the current fiscal.
The rating agency said that with the increasing demand, milk procurement prices are expected to increase, but higher sales of VAP will have more impact on profitability. Besides, skimmed milk powder inventory will decline by the end of this fiscal from the peak seen last year, easing working capital borrowings, it said.
Farmers and processors are increasingly taking help of digital tools to provide quality milk to the end users, said company executives.
AgNext Technologies CEO Taranjeet Singh Bhamra said, “During Covid-19 and subsequent lockdowns, AgNext helped dairy businesses to circumvent the manpower shortage issues, by providing quick, digitised solutions which ensured quality testing at milk collection centres continued unhindered.”
Due to the pandemic, agribusinesses have realised that impactful digital interventions can not only improve food quality but also address traceability issues, an increasing concern, said Bhamra. “The pandemic has underlined the need for assured food safety and through our cloud-based SaaS platform, Qualix,” he said.
Consumer behaviour may have shifted towards more snacking occasions during the day, and even night. However, there is a growing consciousness about reducing the guilt of snacking. ‘No additives or preservatives’ is a top claim connected with clean label in the Indian snacking space, which has grown from 11% of total snack launches in the 12 months to January 2017, to 19% between February 2020 and January 2021, according to a Mintel study shared exclusively with TOI.
The study on snacking attitudes of Indian consumers said that, as products with ‘free-from’ claims on packs raise consumer awareness about specific ingredients to avoid, the demand for such formulations will rise. Mintel’s associate director (food & drink – India & Thailand) Rushikesh Aravkar said, “Consumers are looking at snacking more often and are also replacing meal occasions with snacking occasions. While 42% look for nutrition on packs while purchasing, taste remains an important factor. But consumers are increasingly looking at what’s there in the pack — whether it’s healthy or not. The concept of clean eating is evolving.”
Aravkar said if hunger and energy were the key drivers for snacking pre-pandemic, today it’s a search for comfort and stress-busting benefits that consumers look for. That’s a clear behavioural shift. With most staying at home, four in 10 Indian consumers say their snack consumption has increased. While 7 in 10 consumers say taste is more important than how healthy the snack is, 85% of consumers also feel the need for healthy snack options. The study, conducted among 3,000 Indian adults aged 18 and above, highlights how brands can emphasise naturalness and no ‘nasties’ as a means to justify snacking and remove guilt as these claims are being increasingly sought by health-conscious consumers.
Parle Products category head Mayank Shah said, “The trend of clean labels is catching up in India. While snack consumers are getting more health-conscious, taste still remains numero uno consideration. But a good development over last few years is that consumers are increasingly looking at labels and are avoiding nasties like preservatives and additives. This is a welcome change from earlier times, when taste used to be the only consideration and consumers were oblivious to what went into the making of product.”
Balancing the taste and health conundrum can be challenging for new product development. Gits Food Products director (sales & marketing) Sahil Gilani said, “We will not sell what we don’t relish ourselves. Being a family business, we take this very seriously and we have been an all-natural brand since our inception in 1963. Claims such as ‘no preservatives’ and ‘no artificial colours or flavours’ have been part of our labelling for decades. However, not all consumers trust on-pack claims. Hence, it is also important to educate them on the food technology being used to achieve naturalness. Our ready meals packs mention ‘advanced retort technology — preserving without preservatives’. Mentioning key ingredients on the front of the pack is also a good way to educate customers.”
The growing prevalence of lifestyle diseases in India and the accelerated momentum of health consciousness caused by Covid has opened up opportunities for snacks that are both healthy and indulgent. Mintel has predicted that in 12 months, as consumers transition into the next normal, foods that support their emotional wellbeing will continue to be in demand.