Mahindra ShubhLaabh changes tactic to boost grape exports March 2018 issue

The largest exporter of grapes from India plans to have all-year-round stocks of grapes for exports

Mahindra ShubhLaabh changes tactic to boost grape exports

The company plans to source 2,500 tonnes of grapes from Egypt in the next two years for exports to Europe Interview by Jayashankar Menon |  @TheDollarBiz
Grapes-TDB The largest exporter of grapes from India plans to have all-year-round stocks of grapes for exports
  Mahindra ShubhLaabh Services Limited (MSSL), the agribusiness vertical of Mahindra & Mahindra Limited (M&M) and one of the leading exporters of grapes from India, has identified Egypt as a source of grapes for exports to Europe, the company’s major export market. The move not only aims to bolster MSSL’s supply chain in European markets by meeting demand during offseason, but also reduce the costs of logistics by leveraging Egypt’s strategic location. In an exclusive interview with The Dollar Business, Ashok Sharma, CEO of Agri and Allied Business at Mahindra, talks at length about this new initiative and how he plans to drive it forward. Excerpts: mahindraTDB: Why did ShubhLaabh begin sourcing grapes from Egypt? AS: Sourcing from Egypt complements the Indian grape season. By sourcing grapes from Egypt, we have expanded our supply window to August. The Indian window is from February to mid-May and the Egypt window is from June to August. The move will not only strengthen our position in existing markets, but will also help us tap some new markets. TDB: Is sourcing of grapes from Egypt in addition to what is exported to Europe from India? AS: Yes, that is right. The India operations will continue. In fact, the varieties being sourced from Egypt are Superior Seedless and Flame Seedless. We also plan to source Crimson Seedless and Red Globe form the country in the near future. TDB: Do you also import grapes from Egypt for the Indian market? AS: Currently, we are not importing grapes for the domestic market, but it is certainly on the cards. TDB: How realistic is your target of exporting 850 containers or 10,000 tonnes of grapes to Europe in the next season? AS: We are the leading exporter of grapes from India today. In fact, we exported close to 670 containers in the last season. We are pretty confident of achieving our target of 850 containers in the next season. As far as sourcing from Egypt is concerned, we are aiming at exporting about 50 containers of grapes sourced from Egypt in the next season and then subsequently scale up our sourcing from there. TDB: Overall, in terms of both domestic and overseas procurement, what will be your total sourced volume in the next two years? What is the cost advantage of sourcing grapes from Egypt? AS: Our total volume is expected to be around 12,000 tonnes. There is no specific logistics advantage as the cost is almost the same. However, the fruit reaches the market faster due to the shorter distance thereby maintaining the freshness. TDB: Do you also have plans to source other fruit varieties and vegetables from Egypt for European and Indian markets? AS: Yes we do. In fact, we are exploring the possibility of sourcing oranges from Egypt. We are also evaluating few other countries like South Africa, Chile and Peru for sourcing fruits and should arrive at a conclusion shortly. TDB: Will the newly launched Saboro branded apples from Himachal Pradesh and Kashmir be exported to Europe as well? AS: No, currently Indian apples are not exported to Europe. Our focus, currently, is to supply high export quality Indian apples in the domestic market. TDB: There are big overseas apple brands imported from the US, Fuji and China in the domestic market. Can you gain a foothold in the intensely competitive market place? AS: We are pretty confident that with the strong processes, systems, infrastructure and expert team that we plan to put in place across the supply chain, we will be able to compete effectively with the imported apples in terms of quality and price. Our recent JV with Univeg, Belgium, which is one of the leading companies in fresh fruits in the world, will also help us bring in the best agronomy practices and technology that will benefit both Indian farmers and end consumer.  TDB: You import citrus, pear and kiwi fruits from US, China, New Zealand, South Africa, Chile and Egypt to supply in the domestic market. How do you manage the export-import balance? AS: Imports are an important strategy as the Indian consumer would like to have a variety of fruits of good quality. As for exports, our focus currently is on grapes and we will eventually explore and enter banana and pomegranate exports. TDB: You work closely with the farmers in Nashik, Sangli and Solar in Maharashtra. Will you share your technical knowledge with Egyptian grape farmers? AS: Through our 'Khet Se Khalyan' initiative that focuses on improving the productivity and quality of Indian grapes, we have helped increase the Indian grapes growers’ productivity by 50% in the last three years and also improved their returns. We plan to extend the same programme for Egyptian grape growers as well in the coming season. TDB: It is estimated that 90% of the grape production in Egypt is consumed locally. Does that mean ShubhLaabh may export the fruit from India in future? AS: Yes, we plan to initiate export of Indian grapes and pomegranates to Egypt from the next season.