Government Calls upon Industry to Invest in R&D in Agrochemicals Sector

The Government has called upon agrochemicals industry to invest in Research & Development and innovations in agrochemicals sector. Delivering the inaugural address at a two-day Third National Conference on July 30, 2013, the Secretary, Department of Chemicals & Petrochemicals, Ministry of Chemicals & Fertilizers, Shri Indrajit Pal said that in order to remain globally competitive, the industry needs to innovate in products, for which innovative state-of-the-art R&D laboratories and financial resources would be required. Shri Indrajit Pal said that the Indian chemical sector spends 1-2% of their total turnover on R&D as compared to around 5-10% by the chemical industry in the developed countries. One of the emerging areas for R & D is green agrochemicals and the Indian industry is the development of eco-friendly green agrochemicals, he added. 

The Secretary informed that for ensuring quality of agrochemicals, the Government has set up 71 pesticides testing laboratories across the country that include 68 state laboratories, 2 regional laboratories and 1 central laboratory. Manufacturing units should adopt GMP (good manufacturing practices) and take all such measures that are necessary to ensure delivery of quality products to the farmers. Shri Indrajit Pal also informed that the Institute of Agrochemicals Formulation Technology (IPFT), an autonomous body of the Department of Chemicals and Petrochemicals, has been developing state-of-the-art user and environment friendly formulations for the agrochemicals industry. During the last 5-6 years, IPFT has developed many formulations and transferred them to the industries. He urged the industry to take full advantage of the facilities offered by the institute. 

The Conference has been organised jointly by Federation of Indian Chambers of Commerce and Industry (FICCI), Departments of Chemicals & Petrochemicals, Department of Fertilizers and the Department of Agriculture & cooperation, Government of India. Tata Strategic Management Services (TSMG) are Knowledge and Strategy Partners and a Knowledge Paper on the sector was also released. 

With nearly a 1.2 billion population, India requires a robust, modernized agriculture sector to ensure the food security for its population. Scope for further increasing cultivable land is limited. In order to meet the food grain requirements of the country, the agricultural productivity and its growth needs to be sustained and further improved. Pesticides or Agrochemicals are recognized as an essential input for increasing agricultural production and preventing crop loss before and after harvesting. Their judicious usage is very important for the sustained growth of Indian agriculture and economy. 

India has low crop productivity as compared to other countries. Average productivity in India stands at 2 MT/ha as compared to 6 MT/ha in USA and world average of 3 MT/ha. At the same time, India’s pesticide consumption is also low at 0.60 kg/ha as compared to the world average of 3 kg/ha and for Japan 10.80 kgm. Hence, increased usage of pesticides could help the farmers to improve crop productivity. This also portrays the huge growth potential as the Indian economy moves forward. 

The two-day conference will cover topics of relevance to the sector, incl. new developments, innovations, export potential as also issues such as spurious pesticides, regulatory regime etc. A large number of Captains of the chemical industry, academia, policy makers as also the end-users viz: the farmers were present. 

Source: Ministry of Chemicals and Fertilizers

Linking farmers to moving markets

In a new report, FAO is calling for more nuanced policy-making to boost smallholder farm output, requiring better knowledge of individual farm households and the constraints they face, to be able to target investments and policy support where they are needed to ensure that they can sell surpluses from their harvests.

"Smallholder farmers need to be better integrated into markets in order to reduce hunger and poverty," said David Hallam, Director of FAO's Trade and Markets Division. 

"Only with greater market integration and more inclusive value chains will they adopt the new technologies required to achieve productivity growth.

No one-size-fits-all solution

"Policy interventions that aim at encouraging greater levels of smallholder production for sale in markets need to take better account of the heterogeneity of smallholder households. 

Encouraging semi-subsistence producers to participate more in local markets and supporting more commercialized producers to better access sophisticated value chains raise different issues with respect to both their ability and willingness to increase production for sale. There is therefore no ‘one size fits all' solution to encourage greater market participation," Hallam said.

First and foremost, Hallam underlined, is the need for better links to buyers. Farmers will not expend more time, money and energy in producing more, if any surplus they produce will likely go to waste because there is no storage, no transport or, possibly, no market within a reasonable distance, he explained. The risk that any money spent to produce more will be lost is too great a risk for poor farmers to run.

In addition, smallholder farmers are usually the ones investing their own money, with little access to credit or insurance should something arise, such as unfavourable weather conditions.

"Just as smallholders are a heterogeneous group, the markets in which they participate are also diverse in terms of their size, geographic location, connectivity to other markets, power relations between market players, and institutional setting," the report states.

This combination of complex factors means that approaches to smallholder farmers' participation in markets have to be suitably nuanced. 

Closing the yield gap

"Small-scale agriculture is the main source of food in the developing world, producing up to 80% of the food consumed in many developing countries, notably in sub-Saharan Africa and Asia," the report states. "Smallholders and small family farms are therefore central to an inclusive development process and their contribution is crucial to food security," it adds.

Yet, in sub-Saharan Africa, the yield gap between farmers' yields and potential yields is estimated at 76%, meaning farmers produce less than one quarter of what they could. In Central America and the Caribbean, the yield gap is 65%, meaning smallholders produce less than a third of their potential yield. In developing countries, the yield gap is often higher than 50%.

High food prices

High food prices are seen by many policy-makers as an opportunity for smallholders to produce more and earn more income. But experience shows that, often, smallholders have failed to respond as expected.

"High levels of price, production risks and uncertainty, and limited access to tools to manage them deter investment in more productive new technologies that would enable smallholders to produce surpluses for sale in markets. Inadequate infrastructure, high costs of storage and transportation, and non-competitive markets also militate against production of a marketable surplus," Hallam said.

"Given these constraints, it is not surprising that the supply response of many small producers to recent high food prices has been muted."

Beyond an enabling environment

According to the report, the public sector, together with international development partners, should have a strong role as moderator among different public, private and civil society actors, promoting what is in the best interests of the smallholder agricultural sector while encouraging development of markets.

Given the limitations of the public sector in many developing countries and reductions in foreign development aid, foreign direct investment (FDI) is also seen as a potential source of funding. 

This sort of investment can take many forms -- not just controversial land acquisitions -- and should ensure sustainable and equitable use of land while strengthening food security for indigenous populations, FAO emphasizes. 

Source: Food and Agriculture Organization (FAO)
http://www.fao.org/news/story/en/item/179362/icode/

New UN food safety and nutrition standards will benefit consumers

The UN food standards body Codex Alimentarius has agreed on new standards to protect the health of consumers worldwide. These include standards on fruit, vegetables, fish and fishery products and animal feed.

 

Codex also adopted codes on the prevention and reduction of ochratoxin A, a carcinogenic contaminant, in cocoa, guidance on how to avoid microbiological contamination of berries and on use of claims for food that is labeled "non-addition of sodium salts" including "no added salt" on food packages, to assist consumers in choosing a healthy diet. 

 

The Codex Alimentarius Commission, jointly run by the UN Food and Agriculture Organization (FAO) and the World Health Organization (WHO), sets international food safety and quality standards to promote safer and more nutritious food for consumers worldwide. Codex standards serve in many cases as a basis for national legislation, and provide the food safety benchmarks for international food trade.

 

At its annual meeting last week, Codex celebrated its 50th anniversary. The session was attended by 620 delegates from 128 member countries and one member organization, one observer country and 41 international governmental and non-governmental organizations, including UN agencies.

 

Safe limits on contamination

 

One of the important work areas for Codex is setting safe limits and giving guidance along the food chain on prevention or reduction of contamination. Food can become contaminated by heavy metals, fungal toxins or bacteria and viruses.

 

The Commission adopted two important codes: prevention and reduction of ochratoxin A (a carcinogenic contaminant) in cocoa and of hydrocyanic acid in cassava, both important products for developing countries. 

 

Fresh berries can be a healthy part of the diet but are also prone to microbiological contamination and have been associated with several foodborne illness outbreaks caused by viruses (Hepatitis A, Norovirus), bacteria (E.coli) and protozoa. The new Codex text gives advice to producers and consumers on how to prevent this contamination.

 

Fair practice in food trade and protecting consumers' health

 

The Commission adopted a number of commodity standards that will protect consumers from fraud and ensure fair practices in the food trade: fresh and processed fruit and vegetables (e.g. avocados, chanterelles, pomegranates, table olives, date paste, and tempe) and fish and fishery products (smoked fish, abalone). The standards help buyers and sellers establish contracts based on Codex specifications and make sure that the consumers get from the products what they expect.

 

The Commission also adopted the nutrient reference values on sodium and saturated fatty acids, which are nutrients associated with non-communicable diseases (NCDs), to be included in the Guidelines on Nutrition Labelling.  This is part of Codex's on-going efforts to promote healthy dietary practices and address the increasing public health problem of diet-related NCDs. 

 

The Commission also adopted the revised and updated guidelines on formulated supplementary foods for older infants and young children to ensure the health and nutrition of the vulnerable population group. Furthermore, the Commission adopted hundreds of safe maximum limits for pesticide residues and veterinary drugs and provisions for food additives.

 

Guidance on control for food and animal feed

 

As animal feed can cause contamination in eggs, meat and milk products, the Commission adopted guidance to countries on how to control animal feed and assess the risk of contamination. The Commission also adopted guidelines for National Food Control Systems to assist countries in implementing food control.

 

Into the future

Because of the volume of trade  and need to harmonize national standards, the Commission agreed to create a new Codex Committee on Spices and Culinary Herbs, which will be hosted and chaired by India.

 

The Commission approved its Strategic Plan 2014-2019, which will guide the work on protecting consumers' health and ensure fair practices in the food trade over the next six years.

 

 

Source: http://www.fao.org/news/story/en/item/179663/icode/ 

British to study how pests, diseases are spread through seed

The increasing global population continues to put pressure on food supplies. Combined with the impacts of climate change and global trade, which have increased the spread of plant pests and disease, this raises concerns about global food security.

Seed is the basic unit of crop production and therefore, food production. Seed-borne pathogens may cause disease or death of plants resulting in yield reduction. In addition, seed is produced and traded across the globe and can carry and spread pests and diseases very efficiently to key production areas.

Fera scientists are leading a major EU-funded project (TESTA) which will look at how and what pests and diseases are transmitted by seed, together with the reliable detection and disinfection of contaminated seed, thereby helping to boost yields.

One of the partners in the project is Prof. Terry Aveling, the chair of the Seed Health Committee for the International Seed Testing Association(ISTA). The Association’s involvement will ensure that results of the project are focussed on global needs and are available for use by seed testing laboratories around the world.

Source: Agropages

OECD-FAO Agricultural Outlook 2013-2022

This is an executive summary of the Report. There are interesting projections for the agriculture sector and we are happy to share this. It is interesting to see that developing countries are being projected to be on an upswing and ride on the export tide. The rising per capita consumption in developing countries including in Asia is likely to fuel all-round growth

Rising demand favours developing countries: For decades, global agriculture was characterised by policy-induced production surpluses in industrialised countries and stagnating growth in developing countries. Policy reforms and economic growth across the globe have been changing demand and supply fundamentals, transforming agriculture into a more market-driven sector which provides investment opportunities. Developing countries are expected to increase their share of global production and capture most of the export growth. 

Slower production growth: Global agricultural production for commodities covered in this Outlook is projected to grow at 1.5% annually, on average, compared to 2.1% in the previous decade. This slower growth is expected to be exhibited by all crop sectors and livestock production. These trends reflect rising costs, growing resource constraints, and increasing environmental pressures, which are anticipated to inhibit supply response in virtually all regions.

Food price inflation has eased: The link between commodity prices and what consumers actually pay for their food is usually not straightforward. So, even though commodity prices remain high, there is some evidence that consumer food price inflation is abating. Nevertheless, with food expenditures accounting for 20-50% or more of household budgets in many developing countries, food affordability remains a concern. 

Markets reflect split in global economy: Although relatively resilient to economic downturns, agricultural markets continue to reflect the impact of a two-speed global economy with weak recovery in developed countries and vibrant growth in many developing countries. Rising oil prices are an important but unpredictable factor in price projections. A depreciating US dollar is expected to reduce the relative competitiveness of other exporters while increasing the purchasing power of many importers. 

Prices will rise over medium term: Commodity prices are currently high by historical levels. In the near term, crop prices should fall as production rebounds, while low inventories keep meat prices high. Longer term prices for both crop and livestock products are set to rise with meat, fish and biofuel prices projected to rise more strongly. 

Inflation adjusted prices remain high: Average real prices for the 2013-22 period are projected well above the 2003-12 average for most of the commodities covered in this Outlook. However, average real prices over the next decade should be lower than the peaks experienced in recent years. 

Consumption to grow: Consumption of all products covered in this Outlook will increase in developing countries, albeit at a slower pace, driven by growing populations, higher incomes, urbanisation and changing diets. Per capita consumption is projected to expand most rapidly in Eastern Europe, and Central Asia followed by Latin America and other Asia.

Agriculture trade continues to increase: Emerging economies will capture much of the trade growth, accounting for the majority of exports of coarse grains, rice, oilseeds, vegetable oil, sugar, beef, poultry and fish. The OECD area share of trade will continue to decline while remaining the major exporters of wheat, cotton, pig and sheep meat and most dairy products.

Outlook uncertainties: Production shortfalls, price volatility and trade interruptions remain a threat to global food security, especially in light of low stocks. A widespread drought like that experienced in 2012 in the United States and CIS countries, on top of low stocks, could raise crop prices by 15-40%. Energy prices add another source of uncertainty, affecting both biofuel markets and input costs. World trade is even more sensitive than production to yield variability and macroeconomic drivers.

Focus on China: This edition of the Outlook takes a special look at China, which has a rapidly expanding agri-food sector. Faced with production constraints and rising demand, China is likely to import more of its food in future but, overall, but is projected to remain self-sufficient in the main food crops. It is projected that China’s consumption growth will slightly outpace its production growth by some 0.3% per year, similar to the trend of the previous decade. As a result, a further but modest opening of China’s agricultural sector is 

anticipated although these prospects vary by commodity.

China has made food security and self-sufficiency in rice and wheat a top policy priority. Agricultural output grew almost fivefold between 1978 and 2011. However, in recent years food prices have been rising, and output is set to slow under rising resource and labour constraints. 

Increased availability of food and higher incomes have improved food security significantly with the number of undernourished falling by almost 100 million since 1990, despite adding 200 million people to its population. Reducing the number of persons undernourished remains a major challenge.

From 2001 to 2012, China’s agricultural imports and exports increased from USD 27.9 billion to USD 155.7 billion. Import dependence doubled from 6.2% to 12.9% with China’s net trade deficit in agriculture and food stood at USD 31 billion in 2012. 

Key uncertainties for China include the ongoing sustainability of high levels of economic growth, increasing resource constraints on production and the potential for increased production variability amid rising climate unpredictability.

Global commodity projections to 2022

Cereals: Production is expected to increase 1.4% per year with 57% of total growth coming from developing countries. Thailand is projected to be the leading exporter of rice followed closely by VietNam while the United States is expected to remain the dominant exporter of wheat and coarse grains.

Oilseed: Production is set to increase even faster than cereals. Palm oil should maintain a stable 34% share of total vegetable oil production. 

Sugar: Production is expected to increase by almost 2% a year with Brazil and India the leading producers. Developing countries will continue to dominate world sugar use. 

Cotton: Man-made fibres will take an ever-larger market share. India’s cotton production is projected to rise 25%, making it the world’s leading producer. 

Ethanol: Production is expected to increase almost 70%, with biodiesel increasing even faster but from a smaller base. By 2022, biofuel production is projected to consume 28% of total world production of sugar cane, 15% of vegetable oils and 12% of coarse grains.

Meat: Developing countries are expected to account for 80% of the growth in global production. Per capita meat consumption growth will slow as major developing economies approach the levels of developed countries. 

Developing countries are expected to generate 74% of global milk production gains. Still, consumption in developing countries is projected to grow faster than production, with higher exports from the United States, the European Union, New Zealand, Australia and Argentina.

Fisheries: Capture output is projected to rise only 5% but aquaculture to increase by 35%. By 2015, aquaculture should surpass capture fisheries as main source of fish for human consumption. 

Source: FAO, http://www.fao.org/docrep/018/i3333e/i3333e.pdf

Seeds Industry to grow at a faster rate in next three years

The future of seeds industry in India seems to be very bright and it is expected that by 2015 it is likely to reach Rs 10,700 crore mark from the current level of about Rs 7,000 crore. A recent ASSOCHAM analysis says that the production levels of seeds in India are likely to grow from the current level of about 40 million quintals to about 63 million quintals by 2015.

The share of organised sector is just over half of the total seed industry at about Rs 3,250 crore while the unorganised sector accounts for the remaining as the marginal farmers comprise over 60 per cent of land owners in India and hence opt for cheaper seeds considering the cost of quality seeds is relatively higher.

Andhra Pradesh, Bihar, Gujarat, Haryana, Karnataka, Madhya Pradesh, Maharashtra, Punjab, Tamil Nadu, Uttar Pradesh and West Bengal are leading commercial seeds producing states in India. Limited availability of agricultural land, diverse use of agricultural crops leading to rising food crop prices, subsidies by the government to use high-yielding varieties to increase productivity and other multiple factors are driving the growth of Indian seed industry.

The seed companies are required to convince farmers to abandon conventional seeds in favour of high-yielding hybrid seeds as the switch can help the farmers get high yields, fetch better prices for their produce and almost triple their income.

The global industry for seeds is likely to cross $71 billion by 2015 from the current level of about $60 billion. The ASSOCHAM analysis reveals that farmers were gradually shedding the inhibitions about hybrids and shifting to the same as yields from varietal seeds were falling significantly but many were still reluctant as hybrids were not only expensive but also couldn’t be reused.

Cotton, corn, pearl millets, mustard and rapeseed, rice, sorghum, sunflower and vegetable hybrid seeds are gaining acceptance and this trend is being borne out of the variation in revenue composition of private sector seed companies. With about 20 per cent share, cotton is the biggest component in the hybrid seed market followed by rice (15 per cent), wheat and vegetables (over 10 per cent each).

While there are a handful of state seed corporations and Seed Farm Corporation of India, engaged in production, distribution and marketing of high volume low value public varieties, there are about 350 private sector producers and distributors and about 300 trading firms.

Seasonality factors and risks arising out of dependence on monsoon are certain key challenges faced by the seed companies which can surely be dealt with through strong research and development and products for both kharif and rabi seasons. Besides, there is also need to use proper technology to develop products suiting evolving disease profiles and climatic conditions.

A robust distribution network providing information on seed performance and improvements is required to gain greater acceptability. Besides, a proper inventory must be maintained to meet the future demand and crop-rotation must be done to retain the customers.

Need for Rural Youth in Agriculture

Rural youth are the future of the agricultural sector.  With a growing world population and a decreasing agricultural productivity in combination with a rural exodus, sustainable food production and supply are threatened. Young farmers play an important role in ensuring food security for future generations but they face many challenges.

The world population is projected to 9.3 billion in 2050 and to reach 10.1 billion by 2100.  According to the World Bank, the size of rural population is expected to continue to grow until 2020. This population growth has resulted in the ongoing sub-division of land and in highly fragmented parcels.   Therefore, youth (especially those with many siblings) end up inheriting just a very small piece.

There is a need to create more vocational training centres for the youth to revive agriculture whose contribution has come down to nearly 15% of gross domestic product (GDP) in the country.

Technological upgrading as well as social engineering will be essential for improving the productivity, profitability and sustainability of small farms. Educated youth can provide demand-driven services such as farm health monitoring and enhancement, production and marketing of the biological software essential for sustainable agriculture, climate risk management, organisation of bioparks, food parks, bio-villages, bioindustrial watersheds, and improved post-harvest technology.

For youth to be persuaded to take to farming, agriculture must be economically rewarding and intellectually stimulating. The development of the services sector in rural India will increase income and improve the efficiency of farming. Once a large number of educated youth settle in villages, much of the IT services work can be outsourced from urban to rural areas. This will help in maintaining our global leadership in this area by making such assignments very cost-effective.

Governments should promote policies and programmes that result in real improvements in the quality of agricultural jobs, especially through adoption of modern technology. They should also ensure that mechanisms, institutions and support networks are in place so young people can advance in these jobs. Because young people’s situations vary from region to region, approaches must be flexible and sensitive to local socio-economic realities.

As a responsible company working for the benefit of the farming community, Crystal Group is committed to encourage youth and support government’s policy for the need of youth in Indian agriculture.