It’s the symbol of happiness, celebration and even that million-dollar smile. Those who love the taste of it think it’s heaven on sandwich – from kids to the elderly. Even the poor mouse lurking in your living room falls for the cheesy bait. While the local variety of cheese is consumed in great volumes in India, the imported variety is increasingly finding space in our kitchen shelves. Better news – it’s a lucrative business!

Neha Dewan | @TheDollarBiz

It’s up for grabs, or so you would think, when you observe the frenzy of activity around cheese stacks in modern retail stores on a bustling weekend. Shopping carts stocked with cheese blocks are known to be the envy of even grown-ups. But if you thought no one cares which part of the world the cheese came from – Italy, France, Netherlands, Switzerland or good old Gujarat – you couldn’t be more wrong! Ask Anita, a New Delhi based marketing professional working for a top MNC and mother of a 16-year-old, who ensures her refrigerator never runs out of ‘high quality’ cheese. “My son is not content consuming local cheese. He is used to his Philadelphia Cream Cheese and Cheddar blocks. So a steady stock is needed at home all the time, else the entire house will be on fire,” she tells The Dollar Business with a chuckle. Indeed! Be it the popular and more known varieties of Gouda, Feta and Cheddar or the relatively lesser known Gruyere, Camembert and Brie – all these neatly labelled packets of imported cheese vanish from the shelves of supermarkets in a jiffy, with customers across age groups, having their pick. Sourced from some of the top international markets, its consumption is not just limited to the affluent. In fact, increasing awareness and accessibility have made even the middle class reach out to this market, making the overall imported cheese market grow at a steady rate of 30% y-o-y. According to a report by management consulting firm Technopak, gourmet cheese, along with olive oil, have made significant inroads into the Indian market. The market, as per the report, grew from 1,200 MT in FY2011 to 1,600 MT in FY2012.

And the momentum continues. Cheese is spread over categories of hard, semi-hard, semi-soft and soft depending on the moisture content and ripening methods. Harder cheese that include Cheddar and Parmesan typically have a lower moisture content and are seasoned for a longer duration. The semi-hard ones are slightly firmer and can be a bit salty in taste. The semi-soft cheese has higher moisture content, at times even as high as 60%; the moisture smoothens its texture base. The semi-soft varieties of Halloumi cheese from Cyprus, and Havarti, originally from Denmark, are very popular among consumers. Soft cheese varieties – French Brie and Camembert – are creamier with a high percentage of water. These varieties of cheese have a short shelf life, and, have to be consumed within two months after production. Denmark (followed by Netherlands and Italy), has been the top country for sourcing bulk quantities of imported cheese into India in FY2013 and FY2014. Denmark, with its array of Danish Blue and Blue Castello cheese, attracted enough consumption, with 111,000 kg of cheese being imported in FY2014 as against 268,000 kg the previous year. Netherlands, famous for its Gouda cheese, followed next with approximately 72,000 kg imported last fiscal as against 126,000 kg the previous year.

Retail prices in India for cheese vary and vary quite a bit. While Holland Gouda is priced at Rs.1,500/kg, Goat Gouda is available at Rs.1,200/kg. Emborg White Feta, imported by Dabon International, is priced at Rs.499 per 200 gm, while Cheddar slices sell at Rs.295 per 200 gm at some of the leading modern retail stores. Delhi-based Modern Bazaar with its branches across the city, for instance, positions its imported food as the USP of the store. Among cheese, stocks of the Greek Classic Feta, Swiss cheese, soft cheese such as Ricotta and Brie, semi-hard varieties of Gouda and Provolone as well as the distinctive blue mold cheese, either soft or firm, can be seen available in good quantities. Further analysis of the operations and logistics of the gourmet cheese market in India indicated that profit margins for vendors supplying cheese in bulk quantities to restaurants, hotels and other food chains are substantial. 

Profit estimate of cheese imports

According to sources, vendors keep a margin anywhere between 10-15%, after working out custom duties, freight tariffs and other costs. Most hospitality chains procure from vendors and pay a higher price for the product. They reason that they have little choice. “The elasticity, texture and taste of imported cheese is all very different from the ones made in India. We have to keep 12-15 varieties of imported cheese for our clients, even if costs are high. These are consumed by both Indian as well as international clients,” Avinash Handoo, Executive Chef at India Grill, a multi-cuisine restaurant at Hilton Garden Inn (New Delhi), tells The Dollar Business. The hospitality player uses some of the best varieties to cater to the demand – Italian cheese such as Buffalo Mozzarella, Mascarpone, Parmigiano Reggiano, Mediterranean Cheese like Feta Greek and Feta cubes as well as the popular Cheddar blocks from Northern Europe, besides a host of others. No wonder it has customised cheese dishes on its menu, with Cheese Fondue, Grilled Halloumi and Cheese Dynamites being the most popular.And it’s not as if Indians are restricting themselves to the more known varieties of Cheddar, Mozzarella or Feta. As Hemant Oberoi, Corporate Chef and Grand Executive Chef, The Taj Mahal Palace Hotel (Mumbai), while speaking to The Dollar Business, puts it, “Indians are now becoming slightly more adventurous with their cheese with international cuisine becoming more popular. Varieties like goat cheese, camembert and brie are quickly becoming top choices.” Most of the imported cheese at the hotel is from Italy, France or Switzerland, with some of the prominent types being Gruyere, Camembert, Feta and Parmesan. In addition to hospitality chains, a bulk of imported cheese finds its way to stand alone restaurants, fast food outlets as well as leading retail stores.But cheese importers have their issues. High import duties leads to additional costs that gets passed on to consumers. Result – consumption of cheese becomes restricted to metros and Tier-2 cities. Inappropriate storage and preservation facilities, in addition to their high costs are problems too. The supply chain and infrastructure bottlenecks only compound delays, costs and wastages. Inadequate cold-storage equipped transport facilities also pose a huge challenge in this segment.

The cold chain framework, with the supply-demand mismatch is a big obstacle. Food chains have their own grievances to share. “For a hotel the number one challenge when it comes to cheese would be storage. Different varieties of cheese require different methods of storage, in order to ensure that it retains its essence. Apart from this most varieties of cheese have an extremely short shelf life,” adds Oberoi of The Taj Mahal Palace.Others lament the delays in customs clearance (that have occurred in recent times) that lead to hotels ordering bulk quantities and stocking material way beforehand. However, despite many-a-challenge, the gourmet cheese market in India is poised for growth with more imported cheese varieties seeking shelf space to cater to the burgeoning demand. The future, looks bright for importers. Interestingly, some psychological factors act as a bonus to the business. “The ‘imported’ tag is good enough to play up on the Indian psyche. The moment such labels are seen by shoppers, there is an image in their mind that says ‘good buy’. Such a mindset, obviously, boosts sales and is good for imported food products, including cheese,” says a cheese producer, who did not wish to be named.Turns out, selling cheese at non-cheesy profit margins is exciting business.