final banana project

PROJECT REPORT ON DEMAND ANALYSIS ANALYSIS AND OPPORTUNITIES TO EXPORT BANANA FROM MAHARASHTRA TO EUROPE

M   AH   AR A S H   ARK E  HT  T   R    A S  S T  T A   T E  E A  AG RI C  CU   UL   T U  UR   E M  ET  T   I   IN   NG   G B O ARD

(MSAMB) Submitted By,

MR. YOGESH NARHARI WAGH Roll No- 256 POST GRADUA GRADUATE TE DIPLOM MANAGEMENT, 2nd SEMESTER SEMESTER DIPLOMA A IN AGRI BUSINEES MA

University of Mumbais of Mumbais

Garware Institute of Career of Career Educatio Education and Develop evelopment, ment, Vidyanagari Camp Campus, Kal Kalina, Santacruz (E) Mumbai - 400 098 January 2011

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Certificate of msamb

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Certificate of msamb

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DECLARATION

I herby state that the p resent  proj ect report entit led Demand Analysis and

Opportunities Opportunities to Export Banana from Maharashtra Maharashtra to Europe  is my original contribution and same has not been submitted on any previous occasion. T o the best  of  my know ledge, the present study is the f irst irst comprehensive w ork  of  its kind f rom the area mentioned. This project would be organisati ons property and the project detai ls kept  private and conf identia idential.

Place- Pune

Yogesh Narhari Wagh

Date- 17/02/2011

(PGDABM, 2 nd  Semester, Roll No- 256)

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CERTIFICATE OF APPROVAL 

It is certified that this project report entitled ´Demand Analysis and Opportunities  to Export Banana from Maharashtra to Europeµ is a record of project work done  independently by Mr. Wagh Yogesh Narhari under my guidance and supervision in the    partial fulfilment of his Post Graduate Diploma in Agri-Business Management  (PGDABM), submitted to Maharashtra State Agricultural Marketing Board Pune and    Garware Institute of Career Education & Development, Mumbai University and that it  has not previously formed the basis for the award of any degree, fellowship or associate to  him.

Mr. Ashok Govande 

Mr. Shirish Patil  

Placement Officer, PGDABM 

Course Coordinator, PGDABM 

GICED, University of Mumbai 

GICED, University of Mumbai 

Santacruz (E), Mumbai 

Santacruz (E), Mumbai 

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ACKNOWLEDGEMENT

I would like to extend my gratitude to Maharashtra State Agricultural Marketing Board, Pune and Garware Institute of Career Education and Development, Mumbai for giving me opportunity to do the project. It is with great sense of satisfaction, I present this study titled



Demand Analysis

and Opportunities to Export Banana form Maharashtra to Europe is my original contribution and which I successfully completed as per the guidelines of the college & MSAMB, Pune.

I am very grateful to the Director Mr. Arun Kshirsagar, the Course Coordinator  Mr. Shirish Patil, Faculty Guide Mr. Ashok Govande and Project Guide Mr. Bhaskar Patil, Manager (Public Relation & Publicity) for motivation and their valuable guidance. I am extremely indebted to my mentor Mr. Bhaskar Patil (Manager  Public Relation & Publicity) for their support, motivation, guidance & encouragement and also their expert and timely advice towards the completion of the study. I would like to convey my gratitude towards them for being so appreciative.

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EXECUTIVE SUMMARY 

Importance of Study India is a sec ond largest producer of f ruit in the w orld . There has been signif icant 

increase in the export of f resh f ruits during the past f ew years.Banana is the m ost  important f ruit crop of India having great s ocio -economic signif icance. It c ontributed 31% of  the t ota l food production in India. World production of banana is estimated at  48.9 million t onnes out of  which 10.4 million t onnes, is contributed by India. India ranks No.1 in production follo wed by Brazil (5.5 million t onn es), Indonesia (2.3 million t onnes), Philippines (3.8 million t onnes), China (1.9 mi llion t onnes) and Australia (1.8 million t onnes). In India, Maharashtra state is the largest banana producing state followed by Tamil Nadu, Gujarat, Assam, Andhra Pradesh and others. In Tamil Nadu

banana is cultivated in 83,308 ha with an annua l production of  2,782 million t onnes. The productivity in Tami l Nadu is 33.39 t onnes/ha comp ared t o 38.1 t onnes/ha in Gujarat. In spite of  being one the largest productions of f ruits & vegetable in the w orld, the export & marketing comp etitiveness am ong the Indian producer remains lo w. India is still lagging behind in actua l export of  these p roduces. By considering this f act, market research was c onducted with the objective t o study, ho w t o enter in foreign market, reducing the comp etition & getting maximum price fo r our banana in Internati ona l market. Also there are huge opportunities t o export banana f rom Maharashtra t o Europe which are focused here.

Primary data was c ollected f rom MS AMBs Banana Export Faci lity Center, Baramati. And sec ondary data coll ected was collected f rom diff erent sources like repo rts, journals, articles, books etc f rom diff erent sources like institutes/ off ices/libraries/internet. 6

Objectives of studyThe sp ecif ic objectives of the study are:  To study market analysis for banana in Eur ope.  To study p rocedure & requirements for expo rt of  banana t o Europe.  To ex plore the potential of  Maharashtra for banana export.

Findings of study About Market Research -The globa l production of  banana is around 76,436 thousand t ons of  which India contributes 24.5%. Besides India, other major banana producing countries are Brazi l, China, Phi lippines, C osta Rica and Ecuad or. Globally, India is biggest exporter t o European Union and, trading 60 -70% of the t otal world exports. So, the Philippine is our most important comp etit or in world. . In India, its peak  production is in a ll around a year. Thus, India can ex port bananas in a ll months when there wi ll be m ore demand and less supply we can export bananas t o Europe as compare t o other countries.

Marketing channel: The banana gr owers use following marketing channe ls.  Export channel: Pr oducer  C ommission A gent  Exporter.  Domestic market channels: Producer - Commission A gent  Wholesa ler 

Retailer  Consumer.

Marketing problems: Banana f armer has following marketing problems. 1) Viral disease. 2) Unavailability of transportati on f acilities. 3) Cheating by commission agent. 4) Lack of  market information.

Conclusion1) It is fo und that ma jority of  banana gr ower pref er the Grade 9 variety due t o its expo rt demand. 2) Most of the p roducers p ref erred Dubai market  for ex port, because It is convenient  for transportation,  There is a g ood demand for Indian f ruits during Muslim f estivals.  The quality contr ol & restricti ons are n ot s o stringent   The time required for destinati on is less U K market. 7

Table of contentsSR. No.

1.

2.

Title  Acknowledgement  Executive Summary Table of contents Introduction 1.1 Overview 1.2 Banana 1.2.1 General 1.2.2 Botany 1.2.3 Taxonomy 1.2.4 Morphology 1.2.5 Cultivati on 1.2.6 Alternative uses 1.2.7 Medicinal Importance 1.3 Global Scenari o of  banana Indian Scenari o of  banana 1.4 1.4.1 Productivity of  banana in India 1.4.2 Harvesting Pattern in India 1.5 Maharashtra Scenario of banana 1.5.1 Major banana Producing Area 1.5.2 Varieties Gr own in Maharashtra 1.5.3 Arrival p atterns & Bahar treatment 1.6 Objectives Introduction of  MSAMB 1.7 Methodology Data Coll ection 2.1 2.2.1 Primary data 2.2.2 Secondary data Analysis of data 2.3

Page No. 5 6- 7 8- 9 11 10 10 10 10 10 10 12 13 13 14 15 16 17 17 18 18 20 20 21

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Sr. No. 3

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Title To Study Market Analysis for Banana in Europe 3.1 PEST Ana lysis of  Europe 3.1.1 Europe: Political Overview 3.1.2 Europe: Ec onomic Overview 3.1.3 Europe: Social Overview 3.1.4 Europe: Techn ology Overview 3.2 Consumer Behaviours in Europe Demand Ana lysis fo r banana in Europe 3.3 Export Procedure & Requirements 4.1 Export Procedure Requirements for Export 4.2 4.3 EUR OGAP Certif icate Potential of Maharashtra for Banana Export  Findings, Suggestions & Suggestions 6.1 Findings of  Study 6.2 Suggestions 6.3 Conclusion References

Page No. 25-39 25 27 31 32 35 37 39 37 38 4 46 45 50 46 48 53

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CHAPTER-1

INTRODUCTION

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BANANA

INTRODUCTION Banana ( Musa sp.) is the sec ond most important  f ruit cr op in India next t o mango. Its year round availability, affordability, varieta l range, taste, nutritive and medicina l value makes it the f avorite f ruit among all classes of p eople. It has also good expo rt potentia l. Origin Banana evolved in the humid tropical regions of  S.E.Asia with India as one of  its centers of origin.

Economic Importance Banana is a very popular f ruit due t o its low price and high nutritive va lue. It is consumed in f resh or c ooked form b oth as ripe and raw f ruit. Banana is a rich s ource of  carbohydrate and is rich in vitamins p articu larly vitamin B. It is a lso a good source of  potassium, p hosphorus, calcium and magnesium. The f ruit is easy t o digest, f ree f rom f at 

and cholesterol. Banana powder is used as the f irst baby food. It helps in reducing risk  of  heart diseases when used regularly and is recommended for patients suff ering f rom

high blood pressure, arthritis, u lcer, gastr oenteritis and kidney dis orders. Processed products, such as chips, banana p uree, jam, jelly, juice, wine and ha lwa can be made f rom the f ruit. Banana f iber is used t o make items like bags, pots and wall hangers. Rope

and good quality p ap er can be p rep ared f rom banana waste. Banana leaves are used as hea lthy and hygienic eating plates. Cultivation of banana  Agro-climatic requirements Banana, basica lly a tr opical cr op, grows well in a temp erature range of  150C  350C with relative humidity of  75-85%. It  pref ers tropica l humid lowlands and is gr own f rom the sea level t o an elevati on of  2000m above m.s.l. Deep, rich loamy soil with p H

between 6.57.5 is m ost  pref erred for banana cultivation. Soil for banana should have good drainage, adequate f ertility and m oisture. Saline solid, calcareous soils are n ot  suitable for banana cu ltivation. A soil which is neither t oo acidic nor t oo alkaline, rich in organic material with high nitrogen content, adequate phosphorus level and plenty of  potash is good for banana.

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Varieties Cultivated Showing the varietal characteristics of commercially grown banana varieties Variety

Description

Grand

It is most accepted internationa l variety. It is a ta ll statured plant and a

Naine

heavy yielder with long cylindrical bunch. On an average it  produces a bunch weighing 25 kg and may go up t o 32 -35 kg, with 8-10 hands with 200-220 f ruits/bunch. The length of the f ruit is 15 -21 cm and girth is 12 13 cm.

Robusta

It is norma l statured with black brown blotches on the stem, bunches

weigh around 20 kg having 8-10 hands/bunch. The length of the f ruit is 15-20 cm and girth is 12 cm with thick  f ruit skin Dwar f 

The plant stature is dwar f . Dark black br own blotches appear all along

Cavendish

the stem. Bunches are large with comp act ly arranged 8-10 hands weighing about 20kg. Length of f ruit is 13 -14 cm and girth 8 -10 cm. Skin is thick and the f ruit tap ers gradually t owards the tip. It is n ot f it for expo rt.

Red banana The plant is ta ll and robust statured. The c olour of the f ruit, pseudo

stem, p etiole and midrib is purplish red. The bunch weight is 20 -25 kg with 6-7 hands and 80 f ruits/bunch. The length of the f ruit is 16 -18 cm. Nendran

There is considerable diversity in plant stature. Bunch has 5 -6 hands weighing about 6-12 kg. Fruits have a distinct neck with thick green skin turning buff  yellow on rip ening. Fruits remain starchy even on rip ening.

Land Preparation Prior t o planting banana, green manuring cr op like daincha, cowp ea etc. may be gr own. The land can be ploughed 2 -4 times and leveled. Rat ovat or or harrow is used t o break  the clod and bring the soil t o a f ine ti lt. During soil p rep arati on basal dose of  FYM (about  50 t onnes/ha. before last harr owing) is added and thoroughly mixed int o the soil. Planting Material About 70% of  the f armers are using suckers as planting material while the rest 30% of 

the f armers are using tissue culture seedlings. Sword suckers with well develop 12

rhizome, conical or spherical in shap e having active ly growing conical bud and weighing approximately 450-700 gm are commonly used as p ropagating material. Treatment of planting material The roots and base of  the planting materia l may be removed. The suckers are dipped in a solution of  0.5 % monocrot ophos and bavistin (0.1%) be fore pl anting. Planting season State

Planting time

Maharashtra

Tamil Nadu

Kerala

·

Kharif  - June  July

·

Rabi - Oct ober  November

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February  Ap ril

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November  December

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Rainf ed- Ap ril-May

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Irrigated crop- August - September

5.5.4 Spacing

Season

Spacing

Kharif 

1.5 x 1.5 m., 2 x 2 m. or 2.5 x 2.5 m.

Rabi

1.5 x 1.2 m., 1.5 x 1.37 m.

Irrigation Banana being a succu lent, evergreen and sha llow rooted crop requires large quantity of water for increasing p roductivity. In winter, irrigati on is provided at an interval of  7 -

8 days while in summer it should be given at an interva l of  4 -5 days. Drip Irrigation Application of irrigati on thr ough drip system helps t o maintain the proportion of  soil air

and soil water which results in early and vigorous growth of  bunches. Raw bunch gets matured ear lier by 30-45 days and yield is increased by 15 -30 % and 58 -60 % of  water 13

is saved on irrigati on, weed is less, cost  on intercultural operations is saved and water soluble f erti lizers can be a pplied. Drip irrigati on may be given @ 15 lit/plant/day f rom planting t o 4 th month, 20lit/pl ant/day f rom 5 th month till shooting stage and 25 lit/plant/day f rom shooting till 15 days pri or t o harvest.

De-suckering Removal of  unwanted suckers is a critical operati on in banana for reducing internal

comp etition with the main plant. Sma ll suckers are rem oved on regular basis up t o 7-8 months. Harvesting and Yield Banana is harvested when the f ruit is slight ly or f ully mature dep ending on the market  pref erences. For long distance transportati on, harvesting is d one at 75 -80 % maturity.

The f ruit is c limacteric and can reach c onsumpti on stage af ter rip ening operation. Variety-wise average yield of banana (tonnes/ha.) Varieties

Average

yield

(tones/ha.)

Basrai, Rasthali

40-50

Shrimanti

70

Grand Naine

65

Ardhap uri , Meanyham

55

Hirsal, Saf ed Velchi, Red banana, La l Ve lchi

45

Poovan

40-50

Monthan

30-40

Dwar f Cavendish , Robusta Champ a & Chini desi

50-60

Nendran

30-35

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Global Scenario 1.2.1 World Banana Production Overview World banana producti on has been c oncentrated in developing countries. Around 98 per cent  of banana p roduction is contributed only by developing countries and are the

expo rters of bananas. Developed countries are the usua l destinati on for expo rt of  bananas. Th ough, in the year 2008, 130 countries were identif ied as banana producer, the production was highly concentrated in f ew c ountries

viz. ,

India, China, Philippines,

Brazil and Ecuad or. These c ountries alone c ontributed more than 60 p er cent  of  worlds t otal banana production. In year 2008, t ota l production of  banana was 97.37 million MT and t otal area under banana cu ltivation was 8.25 mi llion hectare o. India ranks 1st in world in p roduction with 21.8 million MT annua l production f rom 0.62 million ha area . Indias share in world banana production in 2007 was 26.8 p er cent & productivity of 

banana in India was 35 T ons p er ha. Whereas the world banana p roductivity is only 14 MT p er ha.

Major Banana Producing Countries

Source: FAO STAT, 2008

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World wide Area, Production and Productivity of banana

Source: FAO STAT, 2007-08

World Banana Exports The export  of  bananas is a ls o concentrated in developing countries. The four leading banana exporting countries in 2006 were Ecuad or, Costa Rica, Phi lippines and Colombia acc ounted for 64 p er cent  of  w orld ex ports. In which Ecuad or a lone expo rted more than 30 p er cent of  global banana exports.

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Figure: World banana exports (average of the 2002 -2006 periods)

Source: UNCTAD Secretariat from FAO statistics

World Banana Imports The main banana im porting countries are the Eur opean Union, the United States of  America and Jap an, which t ogether accounted for m ore than 70 p er cent  of  w orlds t ota l

imports in 2006. The f irst ten banana importing countries accounted more than 80 per cent  f rom an hist orical p ers pective, banana impo rts are relatively concentrated. The main impo rting areas are the Eur opean Union, the United States of America and Japan, which t ogether accounted for more than 70% of  w orld t otal impo rts in 2006, while the f irst ten banana im porting c ountries rep resented more than 80% of  t ota l imports (consider ing the EU as a whole) .

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 Distribution of the world Banana imports  Average on the 2002 - 2006 periods

Source: UNCTAD Secretariat from FAO statistics

Source: FAO STAT, 2007 

Banana Trade Patterns South America on an open market basis, that is, with n o tariff  or quantitative Concerning the directi on of  trade in bananas, it is impo rtant t o note that, due t o the importance of  the diff erent banana impo rt regimes in the c onsuming countries, the banana w orld trade has a c lear regi ona l character. They have led t o a diff erentiati on among p ref erential markets and open markets for bananas, although this picture has been changing someh ow in the nineties. Trans portation costs and time in banana distributi on also play a role in the regi ona l f ragmentation of  the market. N orth American banana im ports come mainly f rom Central and restrictions.

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Geographical distribution of USA banana imports, 1990 -2007 

Source: UNCTAD Secretariat from COMTRADE statistics

Indian Scenario

In India banana ranks 1st in producti on & 3rd in area a f ter mango and citrus. Indian

banana p roductivity is also reasonab ly better than many banana producing countries. India p roduces export quality f ruits but  lagging in handling and maintaining the qua lity

af ter harvest. Therefore, Indias p resence in internati onal market is insigni f icant since decades. India hardly exports 0.1 million MT every year. In year 2007-2008, India's banana producti on was 232 lakh metric t ons. The major banana gr owing states are Tamilnadu, Maharashtra, Gujarat, Andhra Pradesh, Karnataka, Bihar, West Benga l, Madhya Pradesh, Assam and Kerala. (NHB-2008) 1.3.1 Banana production in India In India, area and production share of  banana is 12 p er cent and 32 p ercent  of  the t ota l

area under f ruit crops and t ota l f ruit  producti on resp ective ly. A verage productivity of  banana in India is 35 Tons p er ha. In year 2007 -08 the 20 major t op ten banana gr owing states were Tami lnadu, Maharashtra, Gujarat, Andhra Pradesh, Karnataka, Bihar, Bihar, West Bengal, Madhya Pradesh, Assam and Kerala

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State wise production of banana in India

Source: National Horticulture Board-2008 Tota l banana production in India in the year 2007 -08 was 23205 thousand MT. In India Tamilnadu ranks 1st in production i.e. 6116.50 thousand MT and share in t otal banana production was 26.36 p er cent. Maharashtra ranks 2nd in banana production it  produces 4962.90 thousand MT & share was 21.39 p er cent.

1.3.2 Exports of banana from India Indian bananas are main ly expo rted t o Gulf  countries which are the nearest market. Indias export share in t ota l world banana export is only 0.1 p ercent. India hard ly

expo rts 0.1 mi llion MT every year. T ota l export  of  banana f rom India in 2007 -08 was 166.62 lakh MT. In year 2007 -08 Indian bananas were main ly exported t o UAE, Nep al, Saudi Arebia, Baharin, Kuwait, Ma ldives, Qatar, Oman, UK, Bangladesh, etc.

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Exports of banana from India

Source: DGCIS Annual report 07-08 Tota l export  of  banana f rom India in 2007 -08 was 166.62 lakh t ons. Out  of  the t ota l expo rts 52.65 lakh MT bananas ex po rted t o United Arab Emirate (UA E), 48.67 lakh MT t o Nep al, 19.11 lakh MT t o Saudi Arabia, 10.11 lakh MT t o Baharin & 9.16 lakh MT banana t o Kuwait.

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Harvesting season of crop in leading states Harvest season of  banana is depicted belo w (in 12 months). STATES

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

Tamil Nadu Maharashtra  Andhra Pradesh Karnataka Bihar  Assam STATES

JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC

Gujarat  Madhya Pradesh West  Bengal

F i  gure-

The abov e graph show ing har v est pattern in lead ing banana grow ing states.

1.3.3 Banana Production & export overview Maharashtra In Maharashtra ma jor banana growing area are Jalgaon, Dhule, Latur, Hingoli, Nanded.

The area under banana cr op during 2007 -08 was 72200 ha. With an annua l production of  49.62 lakh MT. Maharashtra ranks sec ond in the country in respect  of  area & als o

sec ond in resp ect  of  the p roduction. The p roductivity was 62.9 MT p er ha. Which was the highest in the country? Maharashtra occupies the 14 p er cent area of  the country under banana but c ontributes 28 p er cent in banana production. Commercia l production is undertaken in Maharashtra state and the same is marketed a ll over the

country. MSAMB is taking keen e fforts t o promote banana exports f rom Maharashtra by encouraging contract  f arming and the use of  modern techn ologies. Maharashtra is gearing up t o take a share in the internati onal banana market. MS AMB has taken initiative t o set up three expo rt  f acilitati on centers one is at Savada, Ta l- Raver, Dist 22

Jalgaon,Shivleela nagar Ta l-Indapur,Dis -pune and another is at Basmat (Hingoli). Ak luj area is important banana gr owing zone, f armers in this area are much aware ab out  quality production and expo rt  of  banana. Three majo r export companies are active in this area

viz. ,

Unif rutti, M other Dairy, Krushi Vikas Export. These comp anies purchase

the bananas direct ly f rom f armers and export it t o Dubai and Saudi Arebia. Also due t o

the conversion of  onion export  f acility centre in t o Banana ex port  f acility centre at  Indapur and avai lability of  this centre, f acilitated Unif rutti comp any t o start their

sec ond pack house unit for export  of banana f rom Ak luj area.

Objectives of studyThe sp ecif ic objectives of the study are:  To study market analysis for banana in Eur ope.  To study p rocedure & requirements for expo rt of  banana t o Europe.  To ex plore the potential of  Maharashtra for banana export.

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Introduction of MSAMB The Maharashtra State Agricultural Marketing Board (MSAMB), Pune was estab lished on 23rd, March 1984, under section 39A of  Maharashtra Agricultural Produce

Marketing ( Development & Regulation) Act, 1963. MSAMB has done pioneering work in of Agricultural Marketing in the State and achieved success in vari ous areas. the f ie ie ld of A

MS AMB is having an im portant role in developing and coordinating agricultural marketing system in the State of  Maharashtra.

Contact- Managing Director/General Manager Maharashtra State Agricultura l Marketing B oard R-7, Market Yard, Gu ltekadi,

Pune 411 037. Maharashtra, India Tel: 020 2426 1190, 2426 8297 Fax: 020 2427 2095 E-Mai l: [email protected]

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CHAPTER-2

RESEARCH METHODOLOGY

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IntroductionBanana is an im portant  f ruit ruit crop of  Maharashtra. It is cultivated in an area of  43,151 ha with a t ota l production of  4, 31,510 t onnes p roducing about 85% of  the t ota l Indian production, thereby leading in Banana production in the country. Within Maharashtra, production of  Banana is main ly concentrated in the Western Maharashtra regi on and

the Marathwada region & this area is very c lose t o Mumbai, which reduces the transportation cost. The variety Ganesh, Bhagwa ( R ed Ruby) cultivated in Maharashtra is suitable fo r ex po rt  purposes. At  present f air air amounts of  exports of  Banana takes place f rom the state in Ree f er er c ontainers by sea. S o, there is huge scope t o export banana f rom

Maharashtra t o Europe. Design of studyThe study was conducted in 3 major steps; i.

Survey & data collection,

ii.

Analysis of the data,

Prep aration of  Pr oj ect Report 

iii.

International Market Research Processication Marketing research is a systematic ana lysis of  information re levant t o the identif icati & solution of  any problem in the f ie ie ld of  marketing. The marketing research process begins with the rec ognition of  a marketing re lated problems, followed collecting the information of  objective of  the study & methodology, f ina inally analyze that information ool for take out put in form of  conclusion. PEST is we ll know & wide widely applied t ool

internati ona l market research, which is used here t o study the Eur opean market. Location of study- European Market, Data Collection1)

Primary Data- Primary data is c ollected by the f ace ace t o f ace ace interviews of  off icers icers of diff erent  erent  organizations, like  Maharashtra State Agricultura l Marketing B oard, Pune  Banana Expo rt Facility Center, Baramati  MCCIA , Pune  KVK, Baramati

2 ) Secondary Data- Secondary data is coll ected f rom di ff erent  erent  like, web sites of  MSAMB, APEDA, MAHAA NAR, MCCIA & MPKV Rahuri. Several other magazines like Krishi Panan Mitra, Dalimb Vrutt and other search engines like Goo gle.

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CHAPTER-3 MARKET RESEARCH

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3.1. PEST AnalysisPEST is we ll know & widely applied t ool for internati onal market

research, which is

used here t o study the European market. 3.1.1 Europe- Political overviewy

The EU & EFTA: An Introduction -

The EU and EFTA t ogether consist of  31 European countries, which subsequent ly form a market of  more than 510 million potential consumers. EU (European Union)The European Uni on (EU) is a group of  European countries, committed t o working t ogether. Its Member States have set u p common institutions in which they share s ome of  their decisi on-making so that sp ecif ic matters of  joint interest can be made at 

European level. The idea for a European Uni on was conceived in 1950 with a cooperation between 6 Member States, which was main ly concerned with trade and the

economy. Nowadays, in 2010, the EU embraces 27 Member States and a lmost half  a billion p eople, and it covers a wide range of  issues that are signi f icant ly impo rtant in everyday lif e. This has been advantageous to the Member States of the EU in terms of :  Trade between EU countries  Removing technical barriers t o trade  Op ening new markets for p ublic contracts etc.  Eliminating queues at b order crossings. Since its founding nearly 60 years ago, the EU has been likea magnet, attracting a constant stream of  new members, achieving its hist oric and successf ul exp ansion f rom 15 t o 25 Member States in May 2004. The last two Member States joined in 2007, making the current number of  Member States 27. Member States  Be lgium, France, Germany, Ita ly, Luxembourg, The Netherlands (joined 1952)  Denmark, I reland, United Kingdom (jo ined 1973)  Greece (joined 1981)  Portugal, Sp ain (joined 1986)  Austria, Finland, Sweden (joined 1995) Cyprus, Czech Rep ublic, Est onia, Hungary, Latvia, Lithuania, Ma lta, Poland, Slovakia, Slo venia ( joined2004).  Bulgaria, Ro mania (joined 2007)

28

EF  A (Eur p   

¡  

Th Europ

£  

¢  

¤  

Fr

Fr

Tr d  A

¢  

Tr

¢  

ci i ¦  

£  

¢

£  

¥

¥

¡  

¡

¤  

)-

Asso i tio (EFTA) is an int r o

rnment al or ani ation set 

up f or the promotion of f ree tr ade and economic int egration to the benef it  of its f our Member St at es EFTA was f ormed in 1960 as a response to the f ormation of  what  we

today know as the EU Some countries which did not participat e in the EU f ormed EFTA and took similar st eps towards a bett er trade climat e between the Member St at es EFTA

has seen several c hanges in its members with several c ountri es joining to lat er leave to join the EU Member

S §  

§  

¨  

es

 Norway and Swit  erland (joined 1960)  Iceland (joined 1970)  Li echt enst ein (joined 1991)

Fi g

r  : EU and EFTA Member States

©  

  

- EU - EFT A

Si

le Mar    

  

  

et  &

Customs UnionTh e

EE A,

Eur ope an

Eco no mic Are a, co mb

ines the 27 EU Member St at es and the EFTA st at es (except  f or Swit  erland) in an

29

internal, or single, market, where the p artici pating c ountries follow the same basic rules. This entai ls the f ree movement  of  goods, services, p eople and capita l. In other words: products accepted on one EEA market are a lso granted access t o the other EEA markets. The Cust oms Uni on is an important asp ect  of  the single market. It means that  there is a genera l application of  common rules at the external borders of  the single market. Cust om duties and tari ff s are the same in a ll countries when a product enters f rom outside the area. Switzer land does not belong t o the EEA, but it d oes have a

number of  bilatera l agreements with the EU. Switzerland largely follows EU legislation with imp act on internati ona l trade, including p roduct legislation. Taxes The EU tax system is not harmonized between the Member States (meaning each E U country has its own tax system), but there are certain c ommon rules that must be res pected. V AT (Value Added Tax) rates have been p artially aligned, but there are sti ll diff erences between Member States. Trade rules & Agreements (W TO - Trade rules and Agreements)The EU and EFTA are p art  of  the globa l trade environment, and trade p ractices introduced and handled by the EU and EFTA must be in line with internati ona l practices. The World Trade Organisation (WTO) is the main organisati on that deals with

internati ona l trade rules. These ru les include WTO trade agreements such as the GATT, GATS, TRI PS, SPS and TBT as we ll as individual countries commitments t o lower cust oms tariff s. The WTO is composed of  governments and politica l entities (such as the EU). T oday, in 2010, the WTO includes 153 members. A vast majority of  these members are developing countries. The Doha Develop ment  Agenda started in 2001, and it  provides a plat form where global trade can be discussed between the members, and where d eveloping country needs are given special attenti on. Internationally accepted standards1. Codex Alimentarius: This is the m ost important internati ona l organisation which establishes internationa lly recognized standards related t o food saf ety. Although the Codex standards are n ot mandat ory, the E U uses them as a basis fo r

the development  of  its own food policy and standards. EU legis lation f requent ly ref ers t o the Codex as the basis for the estab lished requirements.

30

2. ISO (International Organisation for Standardizations)The ISO has set up technical regulations for a number of product groups. These are widely used and of ten requested by (European) buyers. LegislationConsumer saf ety is the main driver behind legal product requirements. In addition, reducing the negative im pact p roducts might have on the environment has increasing ly Bec ome an important  f act or when setting product  legislation. One of  the asp ects of  the single market is the f reed om of  movement  for goods. This means that a p roduct  accepted in One country is also granted access t o another country within the sing le market. For this t o f uncti on optimally, legal product requirements must be harm onized. This is a lso what  the EU/EEA is aiming at, and the c ountries have c ome a long way in terms of  harmonisati on. Switzerland, though not a Member of  the EU/EEA, has also taken step s t o keep in line with EU/EEA legal requirements.  Agriculture: General food saf ety has been out lined in the f ramework General Food Legislation, and in accordance, all food must be saf e. To guarantee this, the genera l principl e of only checking the product entering the EU/EFTA region has in practice been

Extended t o include hygiene and traceabi lity measures thr oughout the chain. N orway and the other EFTA countries p articip ating in the EE A are in line with EU foo d legislation. In Switzerland, diff erent  legal acts form a legal environment which

corresponds t o that of  The EU, and products accepted in the EU or one of  the EFTA Member States have access in all of the EU/EFTA countries. What does this mean for you as an exporter? Legal requirements form the minimum set of  requirements fo r a ll products entering the market. Products which f ail t o meet these requirements are n ot a llowed market entry! In developing countries.

31

Europe- Economic Overview: The Eur opean Centra l Bank (ECB) was estab lished in 1998 t o guide the monetary and f iscal activities of  the p articip ating Member States. These E U Member States have g one f urther In their cooperation than the Cust oms Uni on and sing le market and partici p ate in the

European M onetary Union, or EMU. In 1999, the p articip ating Member States f ixed the exchange rates of  their currencies t o the Euro, giving birth t o the Euro- zone. The euro () is probably the EUs most visible achievement. It is the sing le currency, now shared by 16 Member States, re p resenting over tw o thirds of  the EU population. These 16 countries make up the Euro- zone, where the euro is used as common currency. Economic performance The EU and EFTA countries exp erienced years of  continued economic growth, until the f inancia l crisis brought an end t o it in 2009. The ec on omy is expected t o begin t o

rec over With growth forecasted already for 2010.

F i  gure:

GDP per capita in Pur chasing Power Standards compared to EU -27 (=100 )

International trade The EU is the major player in w orld trade, and it is ahead of  the United States and China. The most important trading p artners are the United States, China and Russia. Af ter years of  growth, both imports and exports saw a decrease in 2009 as a result  of  the f inancia l crisis. In September 2010, the E U reported that the European ec onomy was

rec overing f aster than exp ected. The EFTA states, with Switzer land and Norway as main markets, show similar developments. 32

What does it mean for you a s an exporter? Economic growth leads t o an overall increase in demand. At the same time, exchange rates wi ll have an influence on trade: a strong currency means that im ports will become attractive as these are relative ly cheap , whereas a weak currency will make imported goods relatively exp ensive. Exchange rates a lso give rise fo r uncertainties in internati ona l trade. The Eur o-zone helps t o eliminate these uncertainties am ong the partici p ating countries.

Europe- Social OverviewFor over half  a century, the Eur opean Union (EU) has brought  political stability and economic p rosp erity t o its citizens. It has created a f rontier-f ree single market and a single currency, the euro. EU membership has grown f rom 6 t o 27 nations, combined with the four EFTA countries (Switzerland, Norway, Iceland and Liechtenstein) this brings the t ota l population of  Europe t o over half  a billion. If  you are p rep ared and willing t o explore new markets, then this sh ould create opportunities for you as an expo rter. The EU alone is the ma jor exporter in the world and the second largest  importer. The European Union is also an important trading partner for less developed countries, most of  whose exports enter the E U duty-f ree or at reduced rates of  duty. PopulationThe population prof ile is exp ected t o age in basically all of  the European regions. Between 1960 and 2008, the p roporti on of older p eople (65 years and older) in the EU27 population has risen f rom 10 % t o 17 %. According t o Euro stats p rojections, this trend wi ll continue. The largest  percentages of  elder ly p eople in 2060 are exp ected t o be found in Pol and (36.2 %), Slovakia (36.1 %), Romania (35.0 %), Lithuania (34.7 %), Latvia (34.4 %) and Bu lgaria (34.2 %), and the lowest in Luxembourg (23.6 %), the United Kingdom

(24.7 %) and Denmark (25.0 %).

Population Density The population of  Europe is n ot very even ly distributed, some countries are more densely populated than others, and all of the countries contain both rural and urban 33

areas. This is p art ly determined by geograp hical f act ors, in the f ar n orth it is very cold and dark in the winter, and access t o the sea for transport is at a great distance; likewise, many cities have gr own in pl aces where possibilities for commerce are

geograp hically f avourable.

F i gure: Populat ion

Density  in Europe

Changing life styles However, it is not  only the population prof ile that is changing. The number of  households, w omen w orking and education levels is also changing. To start with the education level, the Eur opean -wide trend is that the level of  educati on is bec oming higher. More and more p eople have a university degree or have graduated f rom other higher education institutes. Women are well-rep resented in higher education, with more women enrolling than men. In addition, women are increasing ly employed, thus making them m ore and more f inancia lly independent.

34

What does this mean for you as an exporter?    Ageing population: the opportunities for se lling products that  off er comfo rt, that  have an ergonomic design and that can be used during leisure time wi ll increase. The same is true of products designed t o meet the demands of the elder ly.  Immigrants: This segment  of  the population can serve as a gateway fo r introducing new flavours, tastes and styles f rom diff erent  parts of  the world. They are a lready f ami liar with what is new t o Europeans and they can thus act as ambassad ors.

Moreover, as Europeans are conf ronted with new and di ff erent cultures, their interest  and willingness t o try out new things will increase.  Rising number of small households: The demand for one -person p ackages is on the rise and what is genera lly required for setting u p a household.  Working women: As w omen become more f inancia lly indep endent, they s p end their money on products that appeal t o them (f ashion, home design). A side eff ect  of  this is that time tends t o bec ome scarcer, which in turn gives rise t o an increasing demand for convenience products. Europe- Technology overviewInfrastructureThe f unctioning of  the European internal market & the close trade relations between member states are supported by a dense & diverse trans port  inf rastructure. Road transport  is the m ost important mean of  transportation

for

goods

within the Europe accounting almost half  of  all transport, maritime

transport

comes

sec ond, & railway third. 2000 2006 was  859 billion. There are several entry points int o Europe. The sing le Market and cust oms union mean that entering goods will follow the same procedure regardless of  entry point. Sea trans port is by f ar the largest mode of  transport for g oods entering Europe. Europe has some 1200 ports, the P ort of Rotterdam, the Nether lands, 35

being the largest  one, followed by Antwerp , Be lgium. The f unction of  ports has develop ed through the years t o bec ome logistics centres, off ering services such as st orage, cool-chain services and p rocessing of  materials and goods. Air transport is the sec ond most impo rtant means of  transportati on for exporting t o Europe (in value). In trade between European countries, air trans port is very small. Frank f urt (Main), Germany, is the largest European airport by in terms of  f reight traff ic, follo wed by Amsterdam, the Nether lands and L ondon/Heathrow, the UK.

Transportation Details-

What does it mean for you as an exporter?  Transport: Transport by sea is the m ost common mode of  transport and the m ost  important one for ex porters f rom developing countries. In some cases air trans port may be more relevant, e.g. in case of f resh p roduce. The point  of  entry may not be your f ina l destination, in m ost cases additiona l means of  transportation will be needed for intraEuropean transportation t o the f inal destination.  Investment in infrastructure: In addition t o ensuring smooth transport between the European countries, investments in in f rastructure will mean increased demand f rom the construction sect or.

36

CHAPTER-4

EXPORT PROCEDURE & REQUIREMENTS

37

EXP



TP

   



  

CEDURE OF BA  A  A   

  

An att empt  has been made in this chapt er to provide brief  inf ormation regarding Banana export procedure, export relat ed issues and SWOT analysis Fi g

  

r  

Fl ow of Ex    

 

 A) Har

$  

est ing:

ort  roc !  

"

  

"  

# 

Banana is harvest ed when the f ruit is slight ly or f ully mature depending

on the market preferences For long d ist ance transport ation, harvesting is done at 75-80 % maturit y.

The f ruit  is climact eric and can reach consumption st age af t er ripening

operation. B) Weigh ing: According to the need of the export paramet ers weighing of f ruits should be done. The overweight  and underweight  f ruits should be marked through domesti c channel. C) S ort ing: Af t er proper harvesting and weighing f ruits should be sort ed according to

the export  paramet ers preferred by the country. Sorting should be done according to weight , colour, qualit y, si e et c. D) Cleaning and Brushing: Af t er selecting the f ruits f or export , these f ruits should be properly cleaned to remove any dirt  or unwant ed wast e. For bett er look of  the f ruits brushing is done to enhance appearance and lust er. E) Dr ing: these select ed f ruits should be dried to expel extra moisture on surface to %  

avoid f ungal diseases, packing of these f ruits become easy and attractive.

F) Grading: By weight sei er: Int ernational grading based on si e and color.

38

8.

Criteria and description of grades

 According to Agmark standards banana is classified into following classes:

Table 7.7: Showing grade designation of banana as per AGMARK standards Grade designation Extra class

Grade requirements

Grade tolerances

Bananas shall be of  superior quality. They 5% by number or weight  of  must be characteristics of  the variety bananas n ot satis f ying the and/or commercia l typ e. The f ingers requirements of  the grade, must be

f ree

of  de f ects, with the but meeting th ose of  for

exception

of  very

slight

sup erf icial Class

I

grade

or,

def ects, p rovided these do not aff ect the exceptiona lly, coming within general quality,

app earance of  the the

keeping

p roduce, the t olerances fo r that c lass.

quality

and

presentation in the p ackage.

Class I

Bananas shall be of  good quality. They 10% number or weight  of  must be characteristics of  the variety bananas n ot satis f ying the and/or commercia l typ e. The following requirements of  the grade slight def ects of  the f ingers, however, but meeting those of  Class II may be allowed, provided these do not  or,

excepti onally,

coming

aff ect the general app earance of  the within the t olerances of  that  produce, quality, the kee ping quality and grade. presentation in the p ackage. - slight 

def ects in shap e and colour; - slight  def ects

due

t o

rubbing

and

other

sup erf icial def ects not exceeding 2 sq.cm. of the t ota l sur f ace area

The def ects must not aff ect the flesh of the f ruit. Class

This includes bananas which do not qualif y for 10% by number or weight 

II

inclusion in the higher c lasses, but satisf y the of  bananas n ot satisf ying minimum requirements. The following def ects the requirements of  the may be there, provided the bananas retain their grade, but meeting the

39

essential characteristics as regards the qua lity,

minimum requirements.

the keeping quality and presentation. - def ects in shape and colour provided the product remains the n orma l characteristics of  bananas; - skin def ects

due

t o

scrapping,

scabs,

rubbing,

blemishes or other causes not exceeding 4 sq.cm. of  the t ota l sur f ace area; The def ects must n ot 

aff ect the flesh of the f ruit 

Country Variety

Middle East Colour : Green

Grand Naine Cavendish

Weight of Bunch :2.5 Kg Fruits preferably straight 13 Kg 13-14 °C By Sea

Packing Storage Transport

G) Packing Provisions concerning sizing ( i) F o r the p ur po ses of  sizing bananas, the l ength of  the f i ngers is determined

alo ng the o utside curve f r o m the b lo ss o m end t o the base of  th e p edicel where the edib l e p u lp ends and the diameter is de f i ned as the thickness of  a transverse

secti o n between the l atera l

f a ces. The ref e rence f r uit  fo r

measurement  of  the l ength and grade is: - fo r hands, the median f i nger o n the o uter r o w of  the hand, - F o r c l usters, the f i nger next t o the cut secti o n of  the hand, o n the o uter r o w of 

the c l uster. ( ii) The minimum l ength sho u l d n o t be l ess than 14.0 cm and the minimum

grade n o t  l ess than 2.7 cm. ( iii) F o r a ll c l asses, 10% by number o r weight  of  bananas n o t satis f y ing the

sizing characteristics, u p t o a l imit  of  1 cm fo r the minimum l ength of  14 cm.

40

. Packaging and its details (a) For export 

For p ackaging bananas, telesc opic boxes of  5 ply strength and of  the following dimensions need t o be used -

Te lescopic card board f ibre boxes and other materia ls 





Top = 48.25cm X 31.75cm X 20.25cm -5 ply

Bott om= 47.50 X 31.25cm X 19.75cm -5pl y Gap plate= 3 pl y Foam sheet  or foam pad= 20mm thick, 38cm X 25cm



size

with

10

mm

holes

Weight of f ina l p acked box is app roximately 13.0 Kg Source: Kay Bee Exports, Mumbai and Mahabanana, Jalgaon. .

 Af ter the packing is done  Net weight   Fruit count inside the cart on.  The cold st orage where it is being sent.  Stamp impression.

41

For exampl e if  the impression shows 005970420, 0059 stands for the f armer code given by the comp any, 7 stands for the year 2007, 04 stands for the month April and the last two digits 20 stand for the date. This helps in tracing back the produce of  a particu lar cart on, t o know the f ield f rom which it was brought.

Pallet: A p allet is made of  200 cart ons p acked t ogether in20 layers of  10 cart ons each. Pallets helps in retaining the structure of  the cart ons and als o protects the f ruits f rom getting damaged while transportati on. Pre-cooling: Af ter packing and palletizati on of  f ruits, these pallets are kept in the p recooling chamber at 130C t o reduce the respiration rate and t o increase shelf lif e. Cold storage: For getting better price these f ruits are kept in the cold st orage at 130 C 14oC. Export destination: According t o the demand place by the importing countries the ship are un loaded. BE AN EXPORTER Establishment of Firm For impo rt or export of  any item, Import  - Export C ode ( IEC) is mandat ory. For availing IEC, establishment needs t o be registered with appropriate authorities viz.

Propriet orship / Partnership / Private Limited C omp any / Public Limited C omp any / Co-operative Society / Trust etc. IEC can be avai led on individual name also. Current  Account in any Nati ona lized / Scheduled Cooperative / Mu ltinati ona l Bank, having a foreign exchange f acility, is required in the name of  establishment.

Import - Export Code ( IEC) IEC can be obtained on submission of information in prescribed formats (Part A & Part  D) c ompl eted f illed and signed addressed t o The Joint  Direct or General of Foreign

Trade (J DGFT), Pune / Mumbai. Following SELF CERTIFIED documents should be enclosed with application.

42

1. Firm / Estab lishment registration certif icate - Phot o copy 2. Permanent Account Number (PAN) f rom Inc ome Tax Department - Phot o copy 3. Banker's certif icate in Part B 4. Two Passport size phot ographs of the Chairp erson / Propriet or of the establishment. Phot os pasted on the Bank Certif icate should be end orsed by the bankers. 5. Demand Draf t fo r Rs. 1000/ - f avouring Joint Direct or General of Foreign Trade payable at Pune or Mumbai as p er the jurisdicti on.

6. Declarati on (As p er the fo rmats) 7. Memorandum and Articles of A ssociatio n fo r Pvt Ltd Comp anies, Partner Shi p Deed for Partnership Comp anies etc.

8. A4 Size Enve lope & Rs. 30/ - Posta l Stamp. The forms compl ete ly f illed in all res pects t o be submitted in ONE c opy t o The J oint  Direct or General of Foreign Trade at the addresses given be low, by hand or by post 

(Registered AD). How to locate Importer? An importer can be located through various searches. F ollowing sources will be helpf ul

t o f ind such importers.

y

Agricultural and Processed Food Products Export Development  Authority

(APEDA), y

Indian Trade Promotion Organisation (ITPO)

y

Mahratta Chamber of Commerce, Industries and Agriculture (MCCI & A)

y

Af ter getting this in formation, exporter can direct ly approach t o the importer

with the detai ls of product, rate, p acking etc thr ough f ax / emai l and negotiate f urther t o f inalize the order. If  necessary sampl es should be forwarded t o the

importer and it sh ould re present the materia l. Mode of payment  Norma lly in the trade of  agro ex ports (except onion, rice, other cereals, mango p ulp), importer n orma lly dont p rovide Letter of Credit (L/C). Such export is done on consignment basis (p ayment as p er actual sa les). Exporters get the p ayment af ter deducting port charges, transportation and commission etc. of the importing country. In 43

certain countries export is undertaken on f ixed rates. Market Credit  of the importer should be checked before entering int o the trade. I mporter's credit can be checked by internationa l credit organizations viz. Dun and Bradstreet. Export Credit Guarantee Corporation of India (www.ecgc.in) ECGC also undertakes such typ e of  credit  certif ication work a long with Credit Insurance. Trade for p roducts like onion, rice, cerea ls, processed products is done through Irrevocable 100% Letter of Credit (L/C) at site. Oni on commodity is Canalized (i.e.

expo rt allowed through designated agencies). Customs / Excise Formalities and charges For agro exports, excise duty is n ot applicab le. Cust oms duty @ 1% with resp ect t o the cost of invoice is charged while processing the d ocuments. Understand the importers need Quality parameters such as size, p acking, temperature requirements sh ould be obtained f rom the importer before p acking of the p roduct. It is better t o get requirement f rom the

importer in writing. Pack the materia l strict ly as p er the samples provided t o the importer. Conf irm the standards of  raw material, p ackaging material with the importers requirement. Procedure of shipment  Services of  Cust oms H ouse Agents (CHAs) t o be b ooked t o carry out necessary logistics and p aperw ork required for ex port. J ob like sp ace booking for air exports, order fo r the container, cust om c learance, certif icate of origin etc. is carried out by CHA. An e ff icient  and comp etent CHA should be appointed. Following is the list  of documents required t o be provided t o CHA.

y

Letter of Credit (If  availab le)

y

Invoice

y

Packing List (If  items are more)

y

Certif icate of origin.

y

Phyt osanitary certif icateCan be avai led f rom Direct orate of  Plant Protection, Quarantine and St orage, Ministry of Agriculture.

44

y

Air transport charges are norma lly f ive times c ost lier than sea trans port.

Perishab le commodities like Banana, Mang o, Orange, Grapes can be expo rted through sea using 40 f eet / 20 f eet reef er c ontainers. In certain commodities like mangoes, Contr olled Atm osphere (CA) / M odif ied Atm osphere (MA) containers are also being used t o enhance the shelf lif e of the product. Non -perishab le and semi-perishable items are ex ported through dry containers. Incase of oni on expo rt, regular dry containers are used but their d oor lef t open when they gets loaded on vessel.

Sales Proceed: Sales proceed gets deposited in the bank in foreign currency. Exporter gets the amount in Indian rup ees af ter conversion of the foreign currency. Bank also deducts the commission f rom the converted rupees. Bank a lso intimated the expo rter about the arrival of Foreign Exchange and generates Bank Realization Certif icate (BRC). Export documents including Shipping Bi lls, Export Promoti on (EP) copy sh ould be retained by expo rter. Credit worthiness of the impo rter is of  most importance. If  by any chance the am ount gets stuck by any chance, the issue can be followed up with the help of  ECGC or any private Debt C ollecti on Agen cy (DCA). Such agencies are avai lable w orldwide. D&B is also working as DCA. s 5.2 EUREPGAP CERTIFICATION FOR G OOD AGRICULTURAL PRACTICES: Due t o globa l exp ansion in food trade, the W orld Trade Organizati on (WTO) has set as one of  their objectives the opening up of  trade between c ountries and aims t o address

restrictive trade barriers. Sanitary and phyt o-sanitary (SPS) issues have a lways been important in globa l trade and have become one of  the most impo rtant  potential Technica l Barriers t o Trade (TBT). Pests or p athogens may exist in one country but not  in an other, thus ultimate ly resulting in restrictive TBT. In addition, food sa f ety has become one of  the most important minimum requirements for f uture trade with develop ed countries. The rapid increase in new ly reported cases of  outbreaks of  food borne diseases p articu larly associated with f resh produce has been the primary drive t owards establishing minimum food sa f ety standards. To be p art  of  global trade in f resh produce and food related products it will in f uture require c ompliance t o some kind of  food sa f ety assurance system. 45

What is EUREPGAP CERTIFICATION? EUREPGAP started as a retai ler initiative in 1997 with ma jor inputs and support  f rom the chemical comp anies. EUREPGAP was established by the Euro-Retai ler Produce Working Group (EUREP) with the aim of  setting standard and p rocedures for the develop ment of  Good Agricultural Practices (GAP). What are the Objectives of EUREPGAP? The main objective of  EUR EPGAP is, t o lead the system t o an EN 45011 -based accredited certif ication system, ref erring t o the scope of  "EUREPGAP Fruits and Vegetables". Partners f rom the entire food chain for f ruit and vegetable production have agreed upon the EUREPGAP certif ication document and procedures, which were achieved af ter extensive consu ltation over a three -year p eriod. Benefits Certif ication t o EUREPGAP will bec ome mandat ory as f rom March 2003 for f arms growing produce for expo rt t o Europe, a lthough the EC may a llow s ome latitude in this regard. At this point in time di ff erent certif ication systems could be required for export  t o other countries such as the USA, and Australia. As Europe is our largest export  destination, EUREPGAP certif ication will in all like lihood become a minimum requirement  for entry int o the EU market. H owever, it sh ould be kept in mind that  additiona l retailer requirements wi ll sti ll have t o be met. Discussions are a lready underway t o ensure harmonization between the di ff erent  food saf ety schemes and benchmarking will be essential t o link the vari ous systems. While certif ication t o EUREPGAP wi ll result in additiona l costs t o growers, there will be numer ous benef its. Long -term benef its include more motivated f arm workers due t o im proved f acilities, training and better w orking conditions with a subsequent increase in living standards. This would obvi ously also result in better p roductivity and out puts t o the ultimate benef it for the grower. Other benef its include  M ore environmentally sound f arming p ractices  M ore judicious use of  chemicals and 46

 M ost important ly a cost benef it t o the grower due t o better management p ractices enfo rced by the standard. Maharashtra State Agricultural Marketing Board the aut onomous apex body has been working effort less ly for Expo rt Pr omotion M.S. A.M.B. helps t o boost expo rts of  f armers by setting up of  the Inf rastructural f acilities required for exports. For exporting certain f ruits t o some European countries the f armers require t o have Eurepgap (European Retailer Parties for Good Agricultural Practices) certif icate fo r exporting their produce.

M.S.A.M.B. by rea lizing the need of  time has taken the initiative under the p roject  of  FICCI and NORAD organization t o issue the Eurepgap certif icates t o the f armers. This has he lped the f armers f rom Maharashtra State in getting their Eure pgap certif icates which will p ave

the p ath t o capture the European markets for Mangoes & Bananas in the near f uture.

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EXPORT SPECIFICATIONS FOR BANANA

Grand Naine

Varieties grown in Maharashtra

Grand Naine, Shreemanti, Dwarf Cavendish, Basrai, Robusta, Lal Velchi, Safed Velchi, Rajeli Nendran, Red Banana

Availability

Round the year

Major export potential

UAE, Gulf countries

Varieties in demand Internationally

Grand Naine, Cavendish

Area under Cultivation (Mah.)

57,000 Ha.

Production

36,07,590 MTs

Table 7.9: Showing the annual average price range of banana in EU and GCC markets Country European Uni on GCC

Annual Average price range (2003-08) Currency USD/kg

0.64 t o 0.67

INR/kg

29.1 t o 30.26

USD/kg

0.31 t o 0.37

INR/kg

14.17 t o 17.01

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CHAPTER-5

EXPORT OPPORTUNITIES

49

5.1 Potential of Maharashtra to Export Banana C. Export potential

Ex po rt  po tentia l of  banana is p resented and discussed regi o n wise as belo w:

EU countries E U c o untries impo rted 7,149,513 t o ns of  banana during 2006. Al th o ugh I ndia ex po rted 200 t o ns of  banana t o E U inc l uding U kraine and R ussia, h o wever, there is n o t much sc op e as l arge quantities of  banana are ex po rted by c o untries l ik e Ecuado r, C o st a R ica and C olo mbia in Centra l and So uth A merica and Camer oo n in Af r ica. M o re o ver, E U has s p ecia l p re f e rential agreement with Af r ican, Caribbean

and Paci f ic c o untries. Other c o untries ex po rting t o EU have t o p ay tari ff  duties and thus are n o t ab l e t o c o mp ete with them. There is s o me sc op e of  ex po rting banana t o R ussia and U kraine p r o vided we have s o me p re f e rential arrangement  with these c o untries. There is po tentia l fo r ex po rt  of  5 - 10 tho usand t o ns of  banana. D. Measures for enhancing competitiveness for exports C o untries l ike Phi l i pp ines in S o uth East  A sia and Ecuad o r and C o st a R ica in Centra l A merica are better o rganized and have l arge sized banana pl antati o ns o wned by I nternati o na l c o mp anies. Therefo re, t o enhance c o mp etitiveness, follo wing measures need t o be taken fo r making avai l ab l e qua l ity banana of 

internati o na l standard: Pr o ductio n techn olo gy o n mo dern l ines needs t o be demo nstrated t o the gr o wers o n a massive sca l e.

Farmers need t o be educated ab o ut expo rt requirements and internati o na l qua lity standard Pr o t o c ol fo r po st harvest hand l ing of  Grand Naine, Nendran and R ed banana need t o be p er f e cted/ standardized fo r shi pp ing t o Gu lf  co untries by sea. Mo st mo dern p ackho us e f aci l ities need t o be created, t o begin within Ja lga o n area in Maharashtra and a l s o in Gu j arat. Banana h ol dings in I ndia are very sma ll and it is n o t  po ssible t o insta ll cab l e ways fo r trans po rting bunches f r o m f ie l d t o p ackh o uses t o av o id bruises. U nder these circumstances, gr o u p s of  f a rmers need t o be enc o uraged t o have system of  50

make shi f t  p ackh o uses, t o cut hands f r o m bunches in the f ie ld itself  and send these hands t o central p ackho us e fo r f u rther p r o cessing /treatment and p acking. I t wi ll be advisab l e t o have s o me w o rking arrangements fo r ri p ening of  o ur

banana arriva l s in impo rting c o untries o n a regu l ar basis. I n the lo ng run, I ndia need t o have its o wn ri p ening f aci lities in o ne o r tw o c o untries t o begin with. I t is suggested that training t o p ackh o use w o rkers ab o ut  po st harvest hand l ing

techn ology and al s o ab o ut internati o na l qua lity standards must be imp arted.

y

Present Status

 Govt. of  Maharashtra has ann ounced the creation of  an Agri Export Zone for

Banana covering the Districts of Jalgaon, Dhule,Buldhana,Nanded.  The MSA MB has been named the n odal agency by the G ovt. of  Maharashtra.  MoU (memorandum of Understanding) signed between Govt  of  Maharashtra and

Govt  of  India on 9th June 2003. Maharashtra State Agricultural Marketing Board in c oordination with State agricu ltural department, Local APMC and c ooperative societies continuously arranging training and demonstration programs in rural area t o increase export quality production. The training b ook let  prepared with the help of  exp erts covering pre and post harvest techn ology of  concerned crop is circulated f ree ly among f armers likewise During the year 2003-04, 2032 f armers were trained in 34 one-day training

programs.  During the year 2005 -06, 2458 f armers were trained in 32 training programs.  In the current year MS AMB has pl anned t o conduct 60 one day training p rograms

for f armers.

InvestmentMSAMB with the he lp of  APEDA, New Delhi has started the Banana expo rt  f acility center at Indapur Dist - Pune. The f acility has following diff erent units Prec ooling = 5 Mts. Cold st orage= 60Mts.Mechanical Handling System= 1.5 Mts/hr. 51

5.2 SWOT analysis for export of fresh banana y

Strengths-

 India is largest  p roducer of  banana, pr oducing about 50% of  the t ota l world

producti on.  Banana

production is largely concentrated in Maharashtra & ad joining

Karnataka, TN state c ontributing m ore than 90% of p roduction in India.  The advantage is that this banana producing area is quite c lose t o Mumbai po rt.  Indian cultivar has high sugar & low acid as c omp are t o other banana. This can

popularized in gulf  countries, Europe, Canada, & Far East countries.  Indian banana is very nutritive.  There is abundant suppl y of  banana f rom Maharashtra in a ll seas ons because

possibility of  taking crop in all seas on so Maharashtra can ex port thr ough the

year.  There is additi ona l demand f rom foreign countries.  There is scope t o increase additiona l area under cultivati on of  banana in

Maharashtra.  India is a lready expo rting banana t o a number of  countries in gulf  countries.

y

Weaknesses-

 The pr oductivity of  banana in Maharashtra is very low as compare t o other

states. Although many of  the agro-techniques for obtaining high yie ld of  qua lited f ruits have been standardized, but sti ll much more remains t o done & needs t o

be taken t o the f armer. 

Extensions & dissemination of  technology fo r increasing productivity is the main weak  link. Above all weak  points is due t o non avai lability of  post harvest  inf rastructure like modern pack -houses, reef er vans, pre-cooling f acilities etc. right in the production areas.

 With the results, there are am pl e post -harvest  losses.  Another weak  link is that  f armer/ expo rter have no access t o update

information on export/ import  price trends in various importing countries of  the world.  Although Maharashtra can p roduce bananas throughout the year but the

external f ruit colour as well as f ruit quqlity f ades in the m onth of April t o

52

September esp ecia lly local cultivar because of  intense heat & high humidity & rainf all which need t o be e liminated by better varieties & agr o-techniques. y

Opportunities-

 India is the largest producer of  banana in the w orld, but has a share of only 5% of 

the world expo rt.  India has good varieties with good f ruit quality and can suppl y almost 

throughout the year & thus can bec ome goo d player in export  of  bananas if  required step s are taken & in f rastructural are p rovided.

 Philippines is the biggest ex porter t o EU & t o some extent t o Gulf  countries also

thus cornering 12% of the t ota l world export.  Maximum avai lability of  banana f r om S p ain is in Se ptember t o December months

& thus supply f rom Sp ain tap ers f rom January onwards, & we have golden opportunity here.  Virtua lly there are n o supplies of  banana f rom S p ain during Ap ril t o July m onths.

Whereas, production of  banana in India is peak in the m onth of  December t o March & continue  More than 32% of  t ota l banana production takes place in Maharashtra and

Gujarat states.  Rainf all and humidity are quite less particu larly in Maharashtra and a lso t o s ome

extent in Gujarat state, resulting in lesser incidence of  insects, pests and diseases comp ared t o Central and South America and South East Asian countries.  A sup erior cu ltivar name ly Grand Naine, we ll accepted in internati onal market is

being cultivated in sizeab le area in Maharashtra and Gu jarat states.  Red banana cu ltivar which is pre f erred in some c ountries can create a market  for

itself  with support of display, camp aign etc.  Banana is cultivated in suff icient acreage and in di ff erent agro-climatic

conditions and thus is in a position t o meet the large demands f rom im porting countries on a continuous basis, p rovided planting and cultivati on is well planned.  Transf er of  technology is easy as growers have organized themselves by forming

cooperatives/ ass ociations and have branded their product as Mahabanana.

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 Agri Expo rt Zone for p romoting expo rts of  banana has been estab lished in

Maharashtra in Ja lgaon area.  Post harvest handling f aci lities are available at a sma ll sca le at Navsari and

Borsad in Gujarat state.  Banana Export Faci lity Center with mechanica l handling system has been set up

at Saavada in Ja lgaon and Basmantnagar in district Hingoli in aharashtra state  Geograp hically, India is better placed comp ared t o South East  A sian, Central and

South American countries for ex ports t o Gulf  countries. .

y

Threats-

 Major threats t o Indian exports are f rom Phi lippine & colambia esp ecially t o

European countries, as both these countries are ab le t o supply at cheap er price because of  low f reight costs. Therefo re, our effo rts have t o be t owards lowering producti on costs by increasing productivity in order t o make our export 

comp etitive.  Panama disease is m ost important threat  for banana export, because it a ff ects

the f ruit of the plant.  Pesticides residues in f ruit are a lso most important threat for banana export.  Most of  the banana gr own in the arid area w here the surety of  rain is very low

So the unsure rainf all is a lso important threat.

54

CHAPTER-5

RESULT & DISCUSSION

55

5.1 Findings of Studyy

 About Market Research-

Globa lly, Philippine, Ecuador, Costa Rica and Colombia is biggest exporter t o European Union and, trading

of  the t ota l 64% world expo rts. So, the Philippine is our most 

important comp etit or in world. In India, its p eak  p roduction is during all around a year so as c omp are t o another country India can export any time and can earn m ore p rof it by expo rting banana. y

Verities Grown in Maharashtra:

The area under Grade Naine is the highest than other verities, due t o expo rt demand in European Union. Dwar f  Cavendish has potential for ex port t o gulf  countries rather than European Union. Dwar f  Cavendish is not suitable for export but area under banana is increasing day by day. This may be due t o the perception that Cavendish ,Grand Naine variety is resistance for panama, Bunchy Top disease. y

Marketing channel: The banana gr owers use follo wing marketing channels.

 Export channel: Pr oducer  C ommission A gent  Exporter.  Domestic market channels: Producer - Commission A gent  Wholesa ler 

Retailer  Consumer. y

Marketing problems: Banana f armer has follo wing marketing problems.

1) Unavailability of transportati on f acilities. 2) Cheating by commission agent3) Lack of  market information.

56

Conclusions1) It is found that majority of  banana grower pref er the Grade Naine variety due t o its export demand.

2) Market channels- The banana gr owers use following marketing channels.  Export channel: Producer  C ommission A gent  Exporter.  Domestic market channels: Pr oducer - Commission A gent  Wholesa ler 

Retailer -Consumer.

3) Most of the p roducers p ref erred Dubai market  for ex port, because It is convenient  for transportation,  There is a g ood demand for Indian f ruits during Muslim f estiva ls.  The quality contr ol & restricti ons are n ot s o stringent.  The time required for destinati on is less U K market.

4) UK market is more stringent  for EU MRL (maximum residual limit) in banana, s o the p roduce, most  of  the times, d oesnt match that  proper standard. Banana f armer pref erred UK market  less than Dubai market.

5) Marketing problem: Banana f armer has following marketing problems.  Unavai lability of  transportati on f acility  Delay in p ayment   Lack of  market info rmation

57

Suggestions1. Pest / Diseases- Good Agricultura l Practices should be promoted. Sp ecial attenti on is needed on Viral diseases and mealy bug disease. 2.  Awareness about pesticides- The banana f armers/traders and even ex porters are not aware about the p esticides. There is need t o creating awareness about  the chemicals. 3.   Awareness about harvesting & post harvest management - Awareness generati on on harvesting & post harvest management with due attenti on on mechanized harvesting, s orting, grading, pre-cooling, waxing, packaging, palletization etc. 4.  Awareness about EUROGAP certification & promotion of contact farmingAwareness about EUR OGAP certif ication & promoti on of  contact  f arming in phased manner should be encouraged.

5. Export Promotion through AEZ- The AEZ on banana c ould t o promote t o include expo rt promotion of f resh banana as well as p rocessed products. 6. Increase an exportable quality production- In long run, export  of  banana can only be enhanced by increasing its ex portable quality production. The measure

such as use of  proper varieties, m odern and highly imp roved cultivation technology, eff icient irrigation methods, optimum use of  plant  protection, chemicals etc should be followed t o produce required quality f ruits in terms of  size, shap e, colour, taste, chemica l content etc. 7. Value addition through processing  Value addition thr ough the p rocessing of  banana and export of  such p roducts t o other countries have enormous scope. 8. Training- Training p rogrammes should be arrange fo r the banana f armers and in these programmes give the training of  exportable banana producti on and show the demonstration of new technologies. 9. Mobile pack house- Mobile pack house are required, Mobile p ack house means a van or container which c ontains f acility like washing, cleaning; drying, c ooling, packaging, etc. such mobile vans cater the need of  sma ll and scatter banana

growers. 10. Improved service for consistency in expert- Once we start the ex port, consistency is necessary. Otherwise im porters do not trust  on us. Also through improved service we can attract the cust omers t oward our banana.

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11. Online service- Online F orms shou ld be made avai lable on MAHABANANAS through internet, internati ona l magazines and other possible means. 12. Packing and labeling  During expo rt, p ackaging and labeling should be attractive, ec onomical and as p er the need impo rter, size of  boxes should in diff erent ranges acc ording t o the cust omers demand. 13. Residue testing system- It is recommended t o strength then the residue testing system es pecially, fo r export of banana t o European countries. 14. Facilities of MSAMB- Growers should be take bene f it  f rom export  f acilities by MSAMB for increasing export sp ecif ication. 15. Organic farming- Growers should carry organic f arming because demand of  f resh organic banana f ruits has increasing day by d ay.

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REFERENCES-

www.msamb.com www.cbi.nl.com www.ap eda.gov.in www.wt o.com www.f ao.com

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 ANNEXURE-1 (Export Documents) 1. Invoice Format  Exporter: Address of the Exporter Phone Fax No.

Invoice No. Date

Exporters Ref.

Buyer·s Order No. Date Other reference(S) Consignee : Address of the Importer Phone Fax No. Buyer (If other than consignee) N.A. Pre Carriage by

Place of Receipt of per carrier

Country Country of Final Destination of Origin of  Goods

Vessel/Freight No.

Port of Loading

Terms of Delivery and Payment

Port of Discharge

Final Destination

Marks No. Description Nos./cont. Goods

No. & Kind of  package

Quantity Gr. Wt.

Rate US$ /  carton

TOTAL NT WT :

FOB

GR WT. :

FREIGHT

AWB/B/L NO. :

Amount US$

C& F Total

Amount Chargeable: (In words) Declaration We declare that this invoice shows the actual price of the goods described and that all particulars are true and correct.

FOR Signature & Date,

Authorized Signat ory,

61

1. Packaging List-

2. Certificate of Origin 62

3.Global gap Certificate-

63

64

5. Euro gap Certificate-

65