Sapotto

CHITTOOR FRUIT PROCESSING CLUSTER – A HOLISTIC PERSPECTIVE MFP-C project is proposed to be set up in the already existing Chittoor Fruit Processing Cluster with a view to leveraging its strengths, exploiting the opportunities emerging and to plug critical infrastructure gaps which impede the cluster growth. Chittoor Fruit Processing Cluster - A Snapshot

It is the largest cluster of its kind in India, naturally evolved and developed over the last 35 years. The genesis of the cluster traces to the initiative of a visionary farmerentrepreneur who invested in mango processing primarily to offset the problems of unremunerative prices offered for fresh mangoes in the district during the peak season.

The growth of the cluster till the mid 90’s was only moderate as many an enterprise was struggling for survival. However, with the initiation of a cluster development project jointly by the Government of India, DC-MSME and Government of Andhra Pradesh the growth of the cluster gained acceleration. Subsequently, further initiatives by the Government, especially under the Agri Export Zone (AEZ) and National Horticulture Mission programmers coupled with expanding domestic and export markets for natural fruit products have contributed to a more planned and sustained growth of the cluster. The salient features of the Chittoor Fruit Processing Cluster are: ¾ Currently, 67 firms exist in the cluster – 60 of them concentrated around chittoor town within 50 km. radius ¾ 76% of the firms could be catagorised as small enterprises; 20% as medium enterprises and 4 % as large enterprises. ¾ The cluster firms predominantly process mango, the peak season of operation extending form April – July. ¾ Other tropical fruits like papaya and guava are also processed though in relatively small quantities. ¾ Some ten firms have facilities for processing tomato. ¾ The product-mix comprises predominantly of single strength mango pulp with 160 brix.

¾ There exists a high degree of homogeneity of processing technologies employed, especially among small scale firms. ¾ Contract manufacturing for exporters and retail majors by cluster firms is quite predominant. ¾ Canning of finished product is still predominant, among a large number of small scale processors notwithstanding the growing market requirement of aseptic packing. ¾ There is a strong presence of support providers viz., exporters, food retailing majors, input suppliers, technology providers, financial institutions, skilled workers etc., complementing cluster operations. ¾ The entire chittoor district is declared as an AEZ under Government of India’s Agri Export Zones scheme. The growth dimensions of the cluster across the years as revealed by some lead indicators are presented in the table.

Growth of Chittoor Fruit Processing Cluster S.No

Indicator

Status

1

Fruit Processing Firms[Nos]

2

Firms having aseptic packing facility [Nos] Installed Capacity [Tonnes/day]

3 4

Channelised

1998-99

2004-05

2007-08

33

50

67

02

06

07

1618

2570

3632

45

77

250

9000

15000

20000

5

Investment [Rs.Crores] Employment [Nos]

6

Exports [Rs.Crores]

51

170

330

7 8

Domestic Sales [Rs.Crores] Firms implementing HACCP (Nos)

17

45

125

02

36

42

9

Firms having ETPs ( Nos)

01

38

45

Proximity to a large catchment area of raw materials, availability of skilled labour and vantageous location within the reach of major markets for the end products are the major locational advantages enjoyed by the cluster.

Low value addition, lack of adequate facilities for aseptic packing and excessive dependence on contract production are the major pressure points impacting the cluster growth.

Accessibility to Raw Material Sources

The growth of the cluster, over the years, is driven inter alia by its easy access to a variety of tropical fruits and vegetables throughout the year not only from Chittoor district but from the contiguous districts - Kadapa, Nellore, Anantapur (Andhra Pradesh), North Arcot, Krishngiri, Dharmapuri (Tamilnadu) and Kolar (Karnataka). A concise account of these districts with respect to raw materials available and conditions influencing their procurement is presented below to facilitate better understanding of the possible catchment area for MFP-C project.

Chittoor District

Chittoor district, extending over 15,152 sq.km is bound on the north by Anantapur and Kadapa districts, on the east by Nellore District and Chengalpattu district of Tamilnadu, on the south by North Arcot district of Tamilnadu and on the west by Dharmapuri district of Tamilnadu and Kolar district of Karnataka. Chittoor town is the district headquarters. Administrative set up of the district comprises: Administrative Setup of Chittoor District S.No 1 2 3 4 5 6

Administrative Units Revenue Divisions Revenue Mandals Revenue Villages Gram Panchayats Municipalities Municipal Corporations

No 3 66 1498 1381 7 1

The district has a population of 37.46 lakhs - 78.35 % rural and 21.65 % urban [2001 Census]

a) Agri- resources Chittoor is an agrarian economy. Paddy is the major food crop grown, followed by jowar and bajra. Sugarcane, groundnut and sunflower are the major commercial crops raised.

b) Horticultural Resources

The soil and climate of the district are most suitable for growing horticultural crops. Mango, Tamarind and vegetables like Tomato, Brinjal, Onion and Chillies are grown extensively, over large tracts of land. The district despite having low rainfall has proved to be quite congenial for Mango and Tomato cultivation. Mango is considered as one of the most remunerative crops and has gained popularity among farmers and is fast replacing other crops. The important vegetables raised are Tomato, Brinjal, Potato, Chillies, Onion, Okra etc. Details of production of various fruits and vegetables in the district are presented in table. Production of Major Fruits & Vegetables in Chittoor District - 2007- 08 Fruits & Vegetables

Area (Ha)

Production (tonnes) Mango 53200 568161 Guava 93 2046 Acid lime 72 1080 Tomato 15184 182208 Tamarind 2523 20184 Chillies 2835 14175 Turmeric 80 720 Potato 1277 19155 Brinjal 1733 24262 Okra 451 5412 Onion 401 3609 (Source: Field survey and State Horticulture Department data)

Yield (tonnes / Ha) 10.60 22 15 12 8 5 9 15 14 12 9

c) Dairy Resources

The district has a population of 9.75 lakh cows and buffaloes. It is one of the leading milk producing districts of the state with well established milk procurement and processing network. Around 9 lakh liters of milk is produced daily and handled by 24 processing centres with an aggregate installed capacity of 11.60 lakh ltrs. The surplus milk is marketed in Tamilnadu.

d) Poultry Resources

Poultry is a lucrative economic activity in the district. The climate is known to be conducive for poultry farming and huge demand for poultry eggs from Chennai, Bengaluru and Vellore offers good scope for more farms, as also facilities for egg washing, grading, packing and storage. e) Supply Chain Analysis of Major Fruits and Vegetables i) Mango Leading varieties of mango cultivated in the district are Totapuri (58%), Neelum (29%), Beneshan (7%) and others (6%). Major market yards for mango trading are located at Bangarupalyam and Damalcheruvu. During the peak season (April – June), these two markets transact a total 1.05 lakh tonnes of mango in a normal crop year, the main customers being the fruit processing units in the district. The traders in the market yards sell mangoes procured from both the local farmers and farmers situated in the neighboring districts of AP, Tamilnadu and Karnataka. The table varieties are transacted to cater to leading fruit markets in Delhi, Mumbai, Chennai, Bengaluru, Hyderabad etc. The farm gate price of process able variety (Totapuri) is Rs. 3000 per tonnes and table variety (Neelum/ Beneshan) is Rs. 10000 per tonne.

Typical Supply Chain for Mango in Chittoor District (Nos.)

Distributors (90)

RTS Units

Farmers (50,000)

Commission Agents (70)

Processing Units (67) Traders (110)

Importer

Exporter Wholesalers (60)

Retailers (300)

ii) Tomato Tomato is the single largest vegetable crop in the district. The varieties grown are 618, 9005, 5005, 918, mahyco, sukarna etc. The crop is grown almost throughout the year.

End Users

The major tomato producing mandals are Peddatippasamudram, Mulkala Cheruvu, Madanapalle, Gurramkonda, Kurabalakota, Shanthipuram, Nimmanapalle, Punganur, Baireddipalle, Palmaner and Tamballapalle.

The main market for tomato trading is located at Madanapalle. Fresh tomatoes are supplied to Coastal Andhra districts, Chennai, Bengaluru, and Hyderabad. 20% of the total production is consumed by fruit processors in the district for the production of tomato puree. The farm gate prices of tomato fluctuate widely, normal price hovering around Rs. 3000 per tonne. Typical Supply Chain for Tomato in Chittoor District (Nos.)

Farmers (15,000)

Commission Agent/ Trader (40)

Wholesalers (300)

Retailers (90)

End Users

Processing Units (6)

iii) Tamarind Tamarind is abundantly available in the district, during the peak season, April - June. The major tamarind producing mandals are Punganur, Ramasamudram, Mulkala Cheruvu,

Pedathippasamudram

B.Kothakota,

Gurramkonda,

Madanapalle,

Nimmanapalle, Kalakada, Pedapanjani and Ramakuppam. The main market for tamarind trading is located at Madanapalle. The major consumption centres are Chennai, Bengaluru, and Hyderabad. The farm gate price of tamarind is Rs. 25000 per tonne. Typical Supply Chain for Tamarind in Chittoor District (Nos.)

Farmer (2500)

Trader (35)

Wholesalers (40)

Retailers (70)

End Users

f) Infrastructure Facilities The physical infrastructure in the district which facilitates transportation of raw materials and finished products is reasonable well develop and comprises market yards, road and rail network, access to seaport and air cargo facilities and cold storages.

f(i) Market Yards Chittoor district has 17 market yards in different locations as detailed below:

Sl. No 1

Market yard Location Bangarupalyam

2

Chittoor

3

Kuppam

4

Madanapalle

5

Mulkalacheruvu

6

Nagalapuram

7

Nagari

8

Pakala

9 10 11

Palamaner Piler Punganur

12

Puttur

13 14

Market yards in Chittoor District Major Commodities Godown Traded facilities Mangoes, Jaggery, Yes Coconut Mango & Jaggery Yes Mangoes, Vegetables, No Coconut Tomato ,Tamarind Yes

Nearest Railway Station Chittoor– 22 km. Chittoor - 0.5km. Kuppam – 2 km.

No

Madanapalle Road – 12 km. Mulkala Cheruvu 0.5 km. Puttur – 35 km.

Yes

Nagari – 5 km.

Yes

Pakala – 1 km.

Yes Yes Yes

Chittoor–42 km. Piler – 3 km. Madanapalle Road – 37 km. Puttur – 15 km.

Somala Srikalahasti

Tomato, Groundnut, Jaggery Tamarind, Bajra, Groundnut Mangoes, Groundnut, Coconut Mangoes, Groundnut, Jaggery, Coconut Tomato Tomato Tomato, Tamarind, Pulses Mangoes, Paddy, Jaggery, Groundnut Mango, Tomato, Jaggery Paddy, Bajra, Groundnut

Yes

No No

15

Thottambedu

Paddy, Bajra, Groundnut

.Yes

16

Tirupati

Yes

Paddy, Jaggery, Yes Groundnut 17 Vayalpadu Tomato Yes (Source: Field survey and Horticulture Department data)

Kalikiri – 15 km. Srikalahasti – 1.5 km. Srikalaber – 22 km. Tirupati – 3 km. Vayalpadu–2 km.

f(ii) Road and Rail Network The district possesses a reliable road and rail network consisting of:

S.NO 1 2 3 4

Road and Rail Network in Chittoor District Category National Highways State Highways Z.P.Roads and District Roads Railway Line

Length (km) 352 295 2648 280.82

f(iii) Seaport Facilities The major seaport utilized for importation and exportation by entrepreneurs in the district is Chennai seaport. f(iv) Air Cargo Facilities Air cargo facilities accessible to entrepreneurs in the district are available at Chennai and Bengaluru.

f(v) Cold Storages 8 cold storages are operating in the district, of which 2 are in Madanapalle (each with a capacity of 4000 tonnes), 4 in Punganur( 2with a capacity of 4000 tonnes each and 2 with a capacity of 2000 tonnes each) and 2 in Kuppam ( with a capacity of 2000 tonnes and 1500 tonnes).

The major fruits and vegetables stored in these facilities are Chillies, Mango, Potato and Tamarind. The charges are fixed on yearly basis and vary from commodity to commodity. The average changes work out to Rs. 850 per tonne. (based on field survey analysis) f(vi) R & D Centers There are four Research and Development centers in the district following on agri and horticulture research: a. Livestock Research Station, ANGRAU – Palamaner b. Regional Agricultural Research Station – Tirupathi c. Agri Research Station – Perumallapalle d. District Agri Advisory Centre - Perumallapalle

Nellore District Nellore district is the southern most coastal district of Andhra Pradesh. The district extends over an area of 13076 sq. km accounting for 4.75% of the total area of the state. It is bounded on the north by Prakasam district, on the east by Bay of Bengal, on the south by Chittoor district and Chengalpattu district of Tamilnadu and on the west by Veligonda Hills separating it from Kadapa district. Nellore town is the district headquarters. Administrative setup of the district comprises: Administrative Setup of Nellore District S.No 1 2 3 4 5

Administrative Units No Revenue Villages 1200 Revenue Mandals 46 Gram Panchayats 968 Mandal Parishads 46 Municipalities 3 (Source: apind.gov.in) The district has a population of 26.50 lakhs - 79 % rural 21 % urban. [2001 Census] a) Agri-resources: Agriculture is the main occupation of the people of the district. Paddy is the principal food crop cultivated, followed by bajra, jowar and ragi. Tobacco, Groundnut, Chillies, Sesamum, Sugarcane are the major commercial crops cultivated. The net area irrigated forms 69.4 % of the area sown and the rest is rain-fed.

Based on the available

agricultural produce, a variety of agro based industries such as rice mills, rice bran oil extraction plants, sugar mills etc. have come up in the district. b) Horticultural Resources: Among horticultural crops, citrus occupies important place. Other important fruits raised in the district are mango, sweet lime, banana guava and sapota. Details of production of major fruits and vegetables in Nellore district are presented in table. Production of Major Fruits & Vegetables in Nellore District - 2007- 08 S. No Fruits/Vegetables Area (Ha) Production Yield ( tonnes) tonnes/ Ha 1 Mango 12313 123130 10 2 Acid Lime 27409 328908 12 3 Sweet Lime 3858 57870 15 4 Banana 1343 33575 25 5 Guava 652 7824 12 6 Sapota (Chiku) 560 11200 20 7 Okra 750 9375 12.5 8 Brinjal 355 3300 9.5

9 French Beans 310 3100 10 Green Chillies 575 4600 11 Bitter Gourd 160 1600 12 Ridebed Gourd 180 2800 13 Leafy Vegetables 230 1320 14 Colacasia 350 2100 15 Leafy Vegetables 100 1000 (Source: Based on Dept. of Horticulture data and field survey analysis)

10 8

c) Dairy The total milk production in the district is 5 to 6 lakh ltrs per day. Three milk processing units in operation with processing capacities are as follows:

S.No 1 2 3

Milk processing facility in Nellore District Processor Location Vijaya Dairy Dodla Dairy Tirumala Dairy

Capacity (LLD)

Venkateswarapuram Potepalem Kadivedu, Chillakur

75000 150000 150000

Details of bulk milk cooling and chilling facilities existing in the district are as follows:

S.No 1

Milk Collection Centers in Nellore District Unit Name Collection Centres Vijaya BMCU

Capacity (LLD) 62000

Adurupally, Duttalur, Kavali, Venkatagiri, DV Satram 2 PD DRDA Podalakur, Dakkili, Venkatagiri 3 Reliance Atmakur, Buchi, Vinjamur, Jaladanki, Kavali 4 Heritage Atmakur, Kaligiri, Naidupet 5 Ramya Chintareddypalem 6 Indira Kavali 7 Vaishnavi Kavali 8 Sai Balaji Kaligiri 9 Mother Dairy Kota 10 Cream Rich Sullurpet (Source: Data from District Industries Centre, GoAP and Field Survey analysis)

15000 25000 15000 5000 5000 10000 5000 5000 5000

Collection pattern: While Vijaya Dairy collects through local societies, private processors collect through milk collection agents. The purchase price for milk is fixed based on SNF and fat content. Generally the price range is Rs. 15 – 20 per liter.

d) Poultry A total 11 layer farms with an aggregate 2.75 lakh birds and 85 broiler farms with 5.55 lakh birds are in operation spread across the district. Most of these farms have their own feed mixing facility. The total egg production is an estimated 15 lakh per day.

About 25% of the produce from the layer farms and 50% of the produce from broiler farms is consumed within the district and the remaining is supplied to markets in Prakasam district and Chennai. e) Supply Chain Analysis of Major Fruits & Vegetables

i) Acid Lime Venkatagiri, Bylalapalli, Dakkili, Sydapuram, Manubolu, Gudur, Chilakur, Kota, Kaliogiri, Rapur, Chejerla, Kaluvoy, Podalakur, Pellakuru, Ozili, Atmakur, Anath, Asagram are the major acid lime cultivating mandals accounting together for 80 percent of the total production. The major market yards for lime exist in Gudur, Venkatagiri, Podalakuru and Rapur. Gudur lime market yard is the largest, transacting an average 60 truck loads per day in peak season (March to April) and 30 truck loads per day in lean season. The produce is supplied through commission agents and traders to markets in West Bengal, Bihar, Jharkhand and Tamilnadu. The major lime varieties grown are Petluru Selection – 1 and Balaji. A citrus research station is established at Pellakuru, Venkatagiri Mandal to develop new varieties and to run a commercial nursery for citrus seedlings.

Two lime processing units are in operation near Gudur, viz. M/s Southern Citrus Products and M/s Sree Laxmi Ganesh Agro Farms Ltd. producing lime oil and calcium citrate. Besides, there are ten small pickle manufacturing units spread in 10 km. radius around Gudur.

The average farm gate price of the produce is Rs. 15000 per tonne.

Typical Supply Chain for Acid Lime in Nellore District

(Nos)

Farmers (27000)

Commission Agent (20)

Processing Units (2)

End Users Exportes-4

Retailers (60)

Traders (90)

ii) Mango

Mango is cultivated largely in Vinjamur, Duttalur, Kaligiri, Kavali, Jaladanki, Rapur, Naidupeta, AS Peta, Atmakur, Chillakur and Gudur mandals. Table varieties Banginapally (60%), Neelum (25%) predominate. The share of proccesable Totapuri variety is small. The major Mango market yards are at Atmakur and Nellore. About 30% of the production is used for local consumption and 70% is sold in the markets located elsewhere in the state as also other states. Small quantities of Totapuri variety is supplied to fruit processing units in Chittoor district. Only one Mango pulping unit (M/s Bindu Foods) near Gudur is in operation in the district. The pickle making units near Gudur also consume small quantities (20 tonnes per month) of Neealum variety. The average farmegate price of a Banganpalli variety is Rs. 12000 per tones. Typical Supply Chain for Mango in Nellore District (Nos) . Farmers (12000)

Commission Agents (6)

Processing Units (1+20)

Traders (45)

End Users Exporters (2)

Retailers (70)

iii) Banana Indukurpeta, Vidavalur, Buchireddypalem and Kovur are the major banana cultivating mandals in the district. Rasthali and Dwarf Cavendish are the main varieties cultivated. More than 30 percent of the produce is used for domestic consumption and the remaining is sold in the neighboring districts of Prakasam and Chittoor besides Chennai

market. The major banana cultivating belt (Indukupeta – Kovur) is more than 60 km away from Gudur. As such only a small portion (one to half truck load per day) is coming to local market yards of Gudur region for local consumption. No banana processing or ripening facilities exist in the district. The average farm gate price is Rs. 14 per dozen. Typical Supply Chain for Banana in Nellore District (Nos) Farmers (500)

Commission Agents (12)

Traders (35)

Retailers (60)

End Users

iv) Sapota (Chiku)

Indukurpet, Kavali, Kaligiri and Jaladanki are the major sapota cultivating mandals. ‘Guthi’ and ‘Pala’ are the main varieties. The main sapota producing belt (Kaligiri – Jaladanki belt) is more than 80 km from Gudur and the local market yards in Gudur region receive only 300 to 400 kg per day for local consumption. No sapota processing units are observed in the region. More than 40 percent of the production is used for local consumption and the remaining is sent to markets in Chittoor and Prakasam districts. The average farm gate price is Rs. 10 per kg. Typical Supply Chain for Sapota (Chiku) in Nellore District

(Nos) Farmers (250)

Commission Agents (12)

Trader (35)

Retailers (50)

End Users

v) Sweet Lime ( Batavia)

Atmakur, AS Peta, Marripadu, Varikuntapadu, Sitharampuram, Vinjamur, Duttalur, Udayagiri and Kaligiri are the major sweet lime cultivating mandals in the district. Nearly 30 percent of the produce is used for local consumption and the remaining is sent to various markets in Andhra Pradesh and Chennai. The major sweet lime cultivating belt (Varikuntapadu – Atmakur) is in the northern part of the district and is more than 90 km

away from Gudur. On an average 3 tonnes per day is transacted in local market yards of Gudur region to cater to local market requirements. No value addition is carried out currently in the district. The average farm gate price in the district is Rs.10 per kg. Typical Supply Chain for Sweet Lime (Batavia) in Nellore District (Nos) Farmers (1500)

Traders (20)

Retailers (50)

End Users

vi) Okra (Bhendi)

Okra is cultivated mainly in Gudur and Venkatagiri mandals. Contract farming of Bhendi and Brinjal in about 200 acres is carried out in and around Chamatapalem village of Venkatagiri mandal. BVS, Sanali and shankara are the major varieties grown. The wholesalers from Chennai supply the seed and buy back the crop. The total area under okra cultivation in the district is 750 hectares with an estimated production of 9375 tonnes. No vegetable processing units exist in the district. The average farm gate price is Rs. 5 per kg. Typical Supply Chain for Okra (Bhendi) in Nellore District (Nos) Farmers (300)

Trader (30)

Wholesalers (65)

Retailers (80)

End Users

f) Infrastructure Facilities

The physical infrastructure in the district which facilitates transportation of raw materials and finished products is reasonably well developed and comprises market yards, road and rail network, access to seaport and air cargo facilities and cold storages.

f(i) Market Yards Nellore district has 11market yards in different location as detailed below: Sl. No

Market Yards in Nellore District Major Commodities Godown Nearest Traded facilities Station

Market yard Location

1 Atmakur Paddy, Bajra, Lime Yes 2 Gudur Paddy, Gingili, Lime No 3 Kavali Paddy, Cotton , Lime Yes 4 Kovur Paddy Yes 5 Naidupet Paddy Yes 6 Nellore Paddy, Pulses Yes 7 Rapur Paddy Yes 8 Sullurpet Paddy, Bajra Yes 9 Udayagiri Paddy, Bajra Yes 10 Vakadu Paddy No 11 Venkatagiri Paddy No (Source: Field survey and Horticulture Department data)

Railway

Nellore – 52 km Gudur – 1 km Kavali – 1km Nellore – 2 km Naidupet – 1 km Nellore – 1 km Venkatagiri – 35 km Sullurpet – 4 km Venkatagiri – 100 km Guduru – 35 km Venkatagiri – 1km

f(ii) Road and Rail Network The district has reliable road and rail network comprising: Road and Rail Network in Nellore District S.NO Category 1 Road Length 2 National Highways 3 Railway Line (Source: apind.gov.in)

Length (km) 5016 184.20 221.23

f(iii) Seaport facilities: At present Chennai (160km away) is meeting the exporting and importing needs of the industrial units in Nellore district. However Nellore district is expected to have a fullfledged port at Krishnapatnam which is expected not only to meet the existing demand but also create demand for setting up of export-oriented industries in future. f(iv)Air cargo Facilities: Air cargo facilities are available nearest at Chennai.

f(v) Cold Storages Five cold storages are operating in the district, three near Nellore and two near Gudur as detailed below: Cold Storages in Nellore District Unit Name

S.NO 1 2 3 4 5

Sri Saibaba Cold Storage, Nellore Vasavi Cold Storage, Nellore Siri Cold Storage, Nellore Shirdi Sai Cold Storage, Manubolu TSR Cold Storage, Chillakur Total (Source: Filed Survey)

Capacity ( tonnes) 6000 5000 10000 6000 5000 32000

All the cold storages in the district are conventional ones with facilities to maintain temperatures from 20 to 200c.

The major fruits and vegetables stored in these facilities are Chillies, Mango and Tamarind besides Groundnut brought from the Prakasam district mainly from Kanigiri. The charges are fixed on yearly basis, averaging Rs. 1000 per tonne. (based on field survey analysis) There are no modular cold storages with varied temperature ranges to facilitate storage of agri and allied products such as okra, eggs, acid lime etc. During the field survey a strongly felt need was observed to store fresh lime in cold storage for a period of two months (from April to May) mainly as a means to stabilizing prices of the produce.

f(vi) R & D Centers Four Research and Development centers exist in the district: a. Agriculture Research Station, ANGRAU-Podalakur b. Agriculture Technology Management Agency (ATMA) - Nellore c. Citrus Research Station, State Horticultural University, Petluru d.

Krishi Vignan Kendra- Nellore

Anantapur District The geographical area of Anantapur district is 19,134 sq.kms accounting for 6.9 percent of the state. The district is bounded by Kurnool district on the north, Kadapa district on the east and on the south by Chittoor district. The district also is flanked by the state of Karnataka on the west and south. Anantapur town is the district headquarters. Administrative setup of the district comprises: Administrative setup of Anantapur District: S.No Administrative Units 1 Revenue Divisions 2 Revenue Villages 3 Revenue Mandals 4 Gram Panchayats 5 Mandal Parishads 6 Municipalities 7 Municipal Corporations (Source: apind.gov.in)

No 3 964 63 1005 63 7 1

The district has a population of 36.40 lakhs - 75 % rural and 25 % urban [2001 Census]

a) Agri-resources: Agriculture is the main occupation of the people of the district. The major food crops are Rice, Jowar, Bajra, Maize and Millets. Groundnut is the principal commercial crop cultivated, followed by mulberry, pulses and sunflower. The net area irrigated is 23% of the area sown and rest is rain fed. Based on the agricultural produce, agro based industries such as rice mills, oil extraction plants etc. have come up in the district. b) Horticultural Resources : Among horticultural crops, sweet lime occupies an important place. Other important fruits produced in the district are pomegranate, papaya, sapota (chiku), chillies, onion and tamarind.

Details of the production of major fruits and vegetables in the district are presented in table.

Production of Major Fruits and Vegetables in Anantapur District - 2007-08 Fruits/Vegetables Area (Ha) Production Yield (tonnes) (MT/Ha) Sweet Orange 111159 2223180 Pomegranate 1040 72835 Papaya 15681 188172 Sapota (Chiku) 9645 192900 Banana 13157 328925 Tamarind 4060 24360 Acid Lime 1558 18696 Tomato 5413 76902 Chillis 5557 77798 Onion 4813 67382 Total 235066 3646476 Source: (Field Survey and of Horticulture Department data)

50 16 30 50 70 15 30 35 35 35

c) Dairy Resources

The total milk production in the district is one lakh liters per day.

There are two

processing units with the capacities of 25000 ltrs and 30000 ltrs respectively.

10 bulk

cooling units with a capacity of 2000 LLD each and 4 mini bulk cooling units with a capacity of 5000 LLD each are operating in the district. d) Poultry Resources 5 layer farms with an aggregate 1.85 lakh birds and 15 broiler farms with 1.2 lakh birds are in operation, spread across the district. Most of the firms are having their own feed mixing facility. The total egg production is 2.35 lakh per day. About 22% of the produce from the layer farms and 40% of the produce from the broiler farms is consumed within the district and the remaining is supplied to Chittoor, Bellary and Chennai markets. e) Supply Chain Analysis of Major Fruits and Vegetables

i) Pomegranate: The major mandals producing pomegranate in the district are Bommenahal, D.Hirehal, L.B.Nagar, Kanekal, Gummagatta, Battalapalli,Mudigubba, Pedda Pappur and Putlur. December-April is the peak season for the crop. The major varieties grown are Baguva and Ganesh.

90% of Baguva variety is supplied to Delhi, Kolkata, Chennai, Bengaluru, Coimbattore, Pune and Bombay markets. Ganesh variety is used for local consumption. The average wholesale price for the pomegranate is Rs. 7000 per tonne. Due to lack of grading, sorting and seed processing facilities, farmers do not get a remunerative price for their produce. M/s Kisan Rallis Seed Processing Private Limited has established a facility for processing pomegranate arils at Kanekal cross in 1997. However the facility is not in operation due to power crisis and technical problems. Typical Supply Chain for Pomegranate in Anantapur District (Nos)

Farmer (1000)

Commission Agent (15)

Traders (35)

Exporter Wholesalers (20)

End Users Retailers (35)

ii) Papaya: Anantapur, Rapthadu, Beluguppa, Kalyanadurg, Kambadur, Settur, B.K Samudram, Narpala, Dharmavaram, Battalapalli and Mudigubba are the major papaya producing mandals in the district. Papaya is grown throughout the year in the district. 786-Taiwan and East-West varieties are most common. The average wholesale price for papaya is Rs. 5000 per tonne. 60% of papaya production is supplied to Delhi, Chennai, Bengaluru, Pune and Hyderabad markets and remaining 40% to local markets. Due to lack of sorting, grading and packing facilities, farmers do not get remunerative prices for their produce. No facilities exist in the district for papaya processing.

Typical Supply Chain for Papaya in Anantapur District (Nos)

Farmer (7500)

Commission Agent (10)

Exporter s (2)

Traders (30)

Wholesalers (30)

End Users Retailers (50)

iii) Sapota(Chiku) Anantapur, Tadipatri, Pedda Pappur, Yallanur, Putlur, Yadiki, Narpala and Gooty are major sapota growing mandals in the district. ‘Pala’ and ‘PKM-1’ varieties are produced in the district.

70% of the production is used in local markets and remaining 30%

supplied to Bengaluru and Hyderabad markets. The average wholesale price for sapota is Rs. 6000 per tonne. Due to lack of sorting and grading facilities, farmers get less remunerative price for their produce. Typical Supply Chain for Sapota in Anantapur District (Nos)

Farmer (4500)

Commission Agent/ Trader (30)

Wholesalers (40)

Retailers (45)

End Users

iv) Sweet Lime Garladinne, Pamidi, B.K. Samudram, Singanamala, Anantapur,Narpala, Dharamavaram, Battalapalli, Mudigubba,Tadimarri, Tadipatri, P.Vaduguru, Yellanur, Putluru and Gooty are the major sweet lime cultivating mandals in the district. . Mogapubba, Season and Gairanguva are the major varieties produced .No value addition is carried out currently in the district. 70% of the production is sold in markets within the state and remaining 30% in Nagpur, Erode, Bengaluru and Chennai markets. The wholesale price is Rs. Rs.4000 per tonne. Due to lack of sorting, grading and cold storage facilities, farmers often lose out in recovering a remunerative price for the produce:

Typical Supply Chain for Sweet Lime in Anantapur District

: (Nos) Wholesalers (90)

Farmer (50000)

Retailers (110)

End Users

Traders (120)

Exporters (8) v) Tamarind

Madakasira, Kalyanadurg, Lepakshi, Parigi, Amadagur, Amarapuram, Gorantla, O.D. Cheruvu, Hindupur and Battalapalli are the major tamarind growing mandals in the district. Tamarind is one of the remunerative cash crops for farmers in the drought prone Anantapur. Due to lack of regular rainfall most of the farmers planted tamarind trees with the support of District Horticulture Department. February to April is peak season for the crop. The wholesale price of the product is Rs. 3500 per tonne. 30% of the production is consumed in the local markets, 70% in markets such as Vijayawada, Guntur, Bengaluru etc., Typical Supply Chain for Tamarind in Anantapur District (Nos) Wholesalers (45)

Farmer (2000)

Trader (40) Exporters (2)

Retailers (55)

End Users

f) Infrastructure Facilities f(i) Market Yards

12 market yards are in operation in different locations of the district as detailed below:

Sl. No 1 2

Market yard Location Anantapur Dharmavaram

3

Gooty

4

Guntakal

5

Hindupur

6

Kadiri

7

Kalayandurgam

8

Madakasira

9

Penukonda

10

Rayadurgam

11

Tadipatri

12

Urvakonda

Market Yards in Anantapur District Major Commodities Godown Traded facilities Ground nut kennel Yes Ground nut, Sunflower Yes seeds , pulses Jowar , Cotton , Yes Groundnut Coriander, Paddy, No sunflower Chillies, Tamarind Yes

Nearest Railway Station Anantapur – 2 km Dharmavaram– 1km Gooty – 2 km Guntakal – 2 km Hindupur – 1km

Ground nut, Tamarind, Sunflower Ground nut, Tamarind, Onion Ground nut, Tamarind, onion Ground nut, Sunflower

Yes

Kadiri – 0.5 km

Yes Yes

Rayadurgam – 32 km Hindurpur - 32 km

Yes

Penukonda – 1 km

Maize, Tamarind , onion , Groundnut Ground nut

Yes

Rayadurgam -2 km

Yes

Tadipatri – 1km

Yes

Guntakal – 34 km

Ground nut pods, Jowar, Bajra

f(ii) Road and Rail Network The district has a good rail and road network comprising:

S.NO 1 2 3 4

Road and Rail network in Anantapur District Category Length (km) National Highways 350 State highways 1261 Z P Roads and District Roads 746 Railway Line (Broad gauge) 338 Railway Line ( Meter gauge) 189

(Source: apind.gov.in)

f(iii) Sea port facilities The nearest seaport facilities, for importation and exportation are available at Chennai 445 km away. f(iv) Air Cargo Facilities Air Cargo Facilities are available nearest, for importation and exportation, at Bengaluru 195 km away.

f(v) Cold Storages Two private cold storages are in operation at Madakasira and Hindupur with a capacity of 2000 tonnes each. Currently, only tamarind is stored in these cold storages. No modular cold storages are in operation in the district. The charges are fixed on yearly basis and the average price per is Rs. 10000. (based on field survey analysis)

f(vi) R & D Centers Four Research and Development centers exist in the district: [[

a. Agriculture Research Station, Anantapur b. Agriculture Research Station, Kadiri c. Agriculture Research Station, Reddypally d. District Agricultural Advisory and Transfer of Technology Centre(DAATTC) Anantapur Kadapa District Kadapa district is bounded by the districts of Kurnool on the north, Chittoor on the south, Nellore in the east and Anantapur on the west. The district has a geographical area of 15,379 sq.km . Kadapa town is the district headquarters.

Administrative setup of the district comprises: Administrative setup of Kadapa district: S.No Administrative Units No 1 Revenue Villages 965 2 Revenue Mandals 51 3 Gram Panchayats 831 4 Mandal Parishads 50 5 Municipalities 6 6 Municipal Corporations 1 The district has a population of 26.18 lakhs - 77 % rural and 23 % urban [2001 Census]

a) Agri-resources :

Paddy is the principal food crop cultivated in the district followed by jowar and maize. Sunflower and groundnut are the major commercial crops grown.

b) Horticultural Resources: Kadapa district is one of the major horticultural districts of the state. The soil and climate conditions of the district are most suitable for growing these crops. Despite low rainfall, the district proved to be congenial for Mango orchards and Citrus plantations. Mango, is considered as one of the best crops and has gained popularity among the farmers and is fast replacing the other crops in a large way due to its high return. The other important fruits grown in the district are Papaya, Sweet lime, Lime, Banana, Guava and Sapota. The important vegetables are Chillies, Onion, Tomato etc.

Turmeric is also grown in the district. Watermelon and musk melon are famous fruit crops in the district. Musk Melon of this district is very popular throughout the state. It is grown in river beds of the district during the months of November to February.

Details of major fruits and vegetables provided in the district are given in table.

Production of Major Fruits & Vegetables in Kadapa District - 2006-07 Production Yield Fruits / Vegetables Area (Ha) (tonnes) (tonnes / per Ha) Mango 17000 170000 10 Sweet Lime 630 12600 20 Acid lime 3753 26295 15 Sapota ( Chiku) 54 1080 20 Guava 33 660 20 Papaya 2026 151950 75 Banana 2893 144650 50 Tomato 1764 44100 25 Brinjal 703 17575 25 Okra 650 6500 10 Onion 931 13965 15 (source: Field Survey & data from Horticulture Department) c) Dairy

The milk production in the district is 3.44 lakh liters a day. DRDA is operating 18 BMCs through SHGs and proposes to set up another 4 BMCs with a total capacity of 1.04 lakh liters per day. The details of milk chilling centres are given below:

Milk Chilling Centres in Kadapa S.No.

Location

Agency

1

Proddatur

DRDA & APDDCF

Capacity (in liters) 20000

2

Rayachoty

DRDA & APDDCF

20000

3

Rajampet

DRDA & APDDCF

20000

4

Pulivendula

DRDA & APDDCF

20000

5

Mydukur

Nandyal Dairy

30000

6

Mydukur

Amrutha Dairy

30000

7

Mydukur

Mukunda Dairy

20000

8

Chapadu

Raghavendra Dairy

20000

9

Badvel

Dodla Dairy

25000

10

Kodur

Tirumala Dairy

15000

(Source : Field Survey and data from DRDA)

In addition, 12 agencies located in Chittoor are procuring 50000 liters of milk per day from Kadapa District. DRDA proposes to set up 100000 ltrs milk processing and products manufacturing unit in the district. d) Poultry No major poultry unit exists in the district, through three small poultry farms are in operation.

Most of the poultry products like chicken and eggs are sourced from

neighboring districts, Chittoor and Nellore. e) Supply Chain Analysis of major Fruits and Vegetables i) Mango: Leading varieties cultivated in the district are Totapuri (25%), Beneshan (45%), Neelum (20%) and others (10%). The major producing mandals are Rly Kodur, Chitvel, Obulavaripalli,

Pullampet,

Penagalur

Siddhavatam,

Rayachoti,

Chinnamandem,

T.Sundupalli, Veeravalli, Galiveedu, Ramapuram and L R Palli. Major market yard for Mango is located in Railway Kodur. In the season (April – June), daily 50-70 trucks with an average capacity of 10 tonnes / each carry mangoes to neighboring districts and other states. The local consumption of mango is 15% and remaining is sent to processing units located in Chittoor district and major markets located in the country. Processable varieties viz., Totapuri, and some portion of Alphonso are sent to the processing units located in Chittoor district. Table varieties viz., Banganpalli, Neelum, Rasalu etc are sent to markets in Delhi, Punjab, Mumbai, Chennai, Bengaluru etc. There are 2 mango pulp processors at T.Sundupalli and Settigunta with a capacity of 4 tonnes/hour each. At present both the units are not functioning due to irregular power supply and other operational problems.

The farm level price of the produce in the peak season is Rs. 4000 per tonne of Totapuri variety and around Rs.10000/- per tonne of table varieties like Beneshan, Akbar, Rasalu etc., Typical Supply Chain for Mango in Kadapa District (Nos)

Farmers (2500)

Commission Agent (2 0)

Processing Units (60)

Traders (60)

End Users Exporters 10

Retailers

ii) Papaya: Only one variety, Taiwan – 786 is cultivated in the district. 80% of the total production comes from Rly Kodur, Chitvel, Obulavaripalli, Rajampet and Pullampet mandals. Papaya is packed and dispatched from the field/ farms only. Local consumption of papaya is around 10%. The remaining is sent to markets in Delhi, Punjab, Uttar Pradesh, Tamilnadu etc., There is high fluctuations in the prices of papaya. The sale price of papaya at farm level is around Rs.2000 per tonne in peak season. There are 7 papaya primary processing units in and around Kodur. The units process unripe papaya and send the slices for further processing into Tutty Fruity by units located in Tamilnadu and Karnataka. Typical Supply Chain for Papaya in Kadapa District (Nos)

Farmers 1000

Commission Agent (2 0)

Processing Units (07)

Traders (40)

End Users

Retailers 160

iii) Banana: The banana varieties cultivated in the district are G-9 (90%), Amrutapani (5%) and others (5%).

Banana is mainly cultivated in the mandals of Rly Kodur, Chitvel,

Obulavaripalli, Rajampet, Pullampet, Duvvur, C.K.Dinne and Siddhavatam. The local consumption of Banana is 30% only. The remaining is sent to Tirupati, Chennai and Bengaluru markets. One Banana ripening unit has started operations recently in Kadapa town with an installed capacity of 65 tonnes/Batch. The wholesale price for unripe banana is Rs. 5000 per tonne. Typical Supply Chain for Banana in Kadapa District (Nos)

Farmers 1400

Commission Agent (10)

Processing Units (3)

Traders (20)

End Users

Retailers 40

iv) Sweet Lime: Majority of the farmers are cultivating sathgudi variety. Sweet Lime is largely cultivated in the mandals of Muddanur, Vontimitta, Vempalle, Pendlimarry and Kondapuram. The local consumption of sweet lime is 10 - 20 %. The remaining is supplied to markets in Hyderabad, Bengaluru, Chennai, Mumbai and Delhi. There are no sweet lime processing units in the district. The farm gate price for sweet lime in the district is Rs. 10 per kg.

Typical Supply Chain for Sweet Lime in Kadapa District (Nos) Farmers 350

Commission Agent (15)

Traders (20)

Retailers 45

End Users

v) Acid Lime: The major mandals growing acid lime are Rajampet, Penagalur, Pendlimarri and Chakrayapet.

The local consumption of acid lime is approximately 15% and the

remaining is sold in Chennai, Mumbai and Bengaluru markets. No processing unit exists for Acid lime in the district. The wholesale price for acid lime in the district is Rs. 15000 per tonne.

Typical Supply Chain for Acid Lime in Kadapa District (Nos)

Farmers 1700

Commission Agent (10)

Processing Units (2)

Traders (20)

End Users

Retailers 40

vi) Tomato: The tomato varieties cultivated in the district are 9005, 5005, 618, 918 , sankranthi, mahyco sukarna etc., It is grown throughout the year in the district. The major cultivating mandals are Chinnamandem, Sambapalli, Mydukur and Rayachoti. The local consumption of tomato is 30% and the remaining 70% is sold in Coastal Andhra districts, Chennai, Bengaluru markets. The local markets / mandies are located

at Sambapalli, Rayachoti and Chinnamandem. No tomato processing units exist in the district. The wholesale price for tomato in the district is Rs. 5000 per tonne.

Typical Supply Chain for Tomato in Kadapa District (Nos) Farmers 850

Commission Agent (45)

Traders (40)

Retailers 50

End Users

f) Infrastructure facilities: The physical infrastructure in the district which facilitates transportation of raw materials and finished products is reasonably develop and comprises market yards, road and rail network, access to seaport and air cargo facilities and cold storages. f(i)Market yards Kadapa has 12 market yards in different locations as detailed below:

Market yards in Kadapa District Major Commodities Godown Nearest Traded facilities Station

Sl. No

Market yard Location

Railway

1

Badvel

2

Kadapa

3

Jammalamadugu

Groundnut, Bajra, Yes Sunflower Groundnut, Turmeric, Yes Paddy Sunflower Vegetables Yes

4

Kamalapuram

Ground nut

Yes

5 6 7 8 9

Kodur L R Palli Mydukuru Proddutur Pulivendula

Banana, Sun flower Groundnut, Sunflower Onion Paddy, Ground nut Fruits , Ground nut

Yes No Yes Yes Yes

Kamalapuram – 2 km Kodur – 4 km Kadapa – 35 km Kadapa – 36 km Yerragantala – 20 Muddanur – 40 km

10 11 12

Rajampet Rayachoty Siddavattam

Paddy Groundnut, Sunflower Paddy, Sunflower

Yes Yes No

Rajampet – 5 km Kadapa – 55 km Kadapa – 30 km

Kadapa – 60 km Kadapa – 5 km Muddanur – 20km

f(ii)Road and Rail network: The district has a reasonably developed road and rail network comprising: Details of Road and Rail network S.NO 1 2 3 4

Details National Highways State Highways Z.P.Roads and District Roads Railway Line

Km 137 491 5906 190.81

f(iii) Sea port facilities The nearest seaport facilities, for importation and exportation are available at Chennai 250 km away. f(iv) Air Cargo Facilities Air cargo facilities are available nearest, for importation and exportation, at Chennai. f(v) Cold Storages There is only one cold storage existing at Proddatur in the district which is not working. Earlier the cold storage was used for storing Tamarind and Chillies.

f(vi) R & D Centers There are four Research and Development centers and one Horticulture College in the district: a) Agriculture Research Station, ANGRAU-Utukur b) Fruit Research Station/Regional Agriculture Research Station- Anantarajupet c) Krushi Vignan Kendra- Utukur d) National Horticulture Research Development Foundation, Mydukur e) Indira Gandhi Centre for Advanced Research on Livestock (IGCARL), Pulivendula f)

Horticulture College – Anantarajupet

Aggregate Raw materials Availability

Aggregate production of major fruits and vegetables, which form the major raw materials for the proposed MFP-C project, from the four catchment districts of Chittoor, Nellore, Anantapur and Kadapa is estimated as follows:

Aggregate availability of raw materials in the cluster

Mango Papaya Banana Pome granite Sweet Orange Sapota Acid Lime Okra Leafy Vegetables Tomato Tamarind

(Area in Hectares, Production in tonnes) Nellore Chittoor Kadapa Anantapur Total Area Pro Area Pro Area Pro Area Pro Area Pro 12313 123130 53200 568161 17000 170000 0 0 82513 861291 2026 151950 15681 188172 17707 340122 1343 33575 2893 144650 13157 328925 17393 507150 0 0 0 0 0 0 10485 209700 10485 209700 3858

57870

0

0

630

12600

111159

2223180

115647

2293650

0 27409

0 328908

0 0

0 0

0 3753

0 26295

9645 0

192900 0

9645 31162

192900 355203

750 100

9375 1000

451 0

5412 0

650 0

6500 0

0 0

0 0

1851 100

21287 1000

0

0

15184 2523

182208 20184

1764

4400

0 4060

0 24360

16948 6583

186608 44544

Seasonality of Raw materials Almost all the horticultural crops are seasonal and available only for a few months in a year. The seasonality of major horticultural crops in the cluster is given below: Seasonality of major Fruits and Vegetables available in the cluster

Fruit

Mango

Papaya

Banana

Guava

Tomato

Sapota

Orange

Sweet Lime

Pomegranate

Okra

Tamarind

Jan Feb Mar Apr May June July Aug Sept Oct Nov Dec

Existing Marketing system: Fruits Majority of the farmers sell their produce to the commission agents operating in nearby market yards, mandis. Majority of processing firms purchase the produce either from the commission agents or from the local mandis. After processing,

pulp,/ concentrate/

purees are supplied to end users like juice, squash, jam& jelly, confectionery and ice cream making units for value addition. The table varieties are supplied by traders/ commission agents to major markets at Bengaluru, Chennai, Kolkatta and Hyderabad. Except a very few processing units, direct exports do not take place from the cluster. Typical existing marketing system for fruits is given in the following diagram. Typical Marketing System for Fruits in Chittoor Fruit Processing Cluster

Farmer/ Grower

Commission Agent ( Local Mandis)

Processed

Processing Units

Further value

End Users/ Exporters

Fresh Fruits

Packing Units

Traders

Wholesalers

Retailers

Vegetables Vegetables like okra, tomato, cucumber and leafy vegetables are sold in the local markets by farmers. Very limited contract farming for okra in Chittoor and Nellore districts was observed. Very few vegetable processing units are operating in the cluster who procures raw materials from the local markets/ mandis. The processing units are directly exporting the vegetables to Germany, Gulf and European countries while the domestic market for the same is very limited. However with the changing food habits of the customers the demand for processed and value added vegetables is increasing steadily. Typical existing marketing system for vegetables is given in the following diagram. Typical Marketing System for Vegetables in Chittoor Fruit Processing Cluster

General Farming

Contract Farming

Commission Agent ( Local

Processing Units/ Wholesale Markets

Traders

End Users/ Exporters

Packing Units

Traders

Wholesalers

Retailers

Value chain analysis Major constraints observed in the present value chain for most of the fruits and vegetables in the cluster are given below: ‰ Primary grading/ collection centers - non existent ‰ Warehousing and cold storage - inadequate ‰ Cold chain – Non existent ‰ Quality certification system - non existent ‰ Transportation for perishables - non existent ‰ Rural markets - complete lack of infrastructure ‰ Wholesale markets - in government control, lack of modern facilities ‰ Post harvest losses - 20 to 30% The existing value chains for some of the major fruits and vegetables in the cluster have been drawn with the help of information gathered during the field survey, and are presented below: Value chain of Mango Pulp (1 ton of mango Pulp (out put) with Carton Packing) Farm level price – Mango (2 tons @ Rs.12000 per ton) - Rs.24000 /-

Labour charges : 800 /Utilities :1200/Rs. 26000/-

Packing material cost : 9600/-

Profit to Manufacturer (15%) - Rs.5340 /-

Rs. 35600 /-

Sale Price to Exporter / Value added firms Rs. 40940/-

Value chain of Papaya (Input 1 tonne of raw material)

Farm level price Rs.2000 /-

Packing ; Rs.400 /-

Rs. 2400 /Transportation & Handling Charges : Rs. 2000/Profit to trader 20% Rs.880 /-

Rs. 4400 /Sale price to Retailer : Rs.5280/-

Profit to Retailer 14% Rs.739 /Final price to consumer (Rs.7/- per Kg)- Rs. 6019

Value Chain of Banana

(Input 1 tonne of raw material)

Farm level price Rs.4500 /-

Ripening & Handling charges Rs. 300/-

Profit to trader 25% Rs.1200 /Sale price to Retailer : Rs.6000/-

Profit to Retailer 15% Rs.900 /Final price to consumer (Rs.7.50/- per Kg)- Rs. 6900

Rs. 4800 /-

Value Chain of Tomato

(Input 1 ton of raw material)

Farm level price Rs.2500 /-

Packing material, Packing & Handling charges Rs. 800/-

Rs. 3300 /-

Transportation Charges : Rs.1000/-

Profit to trader 20% Rs.860 /Sale Price to Retailer Rs. 5160/-

Profit to Retailer 25%Rs.1290/Final price to consumer (Rs.7.50/- kg) – Rs.6450/-

Rs. 4300 /-

Value Chain of Tamarind (Input 100 kgs raw material)

Farm level price Rs.2500 /-

Grading charges : 100 /Cleaning & De-seeding charges : 200 Storage charges :1000/Transport charges: 200/Rs. 4000/-

Packing material cost : 100/-

Profit to trader 20% Rs.800 /Sale Price to Retailer Rs. 4900/-

Profit to Retailer 25%Rs.1200/Final price to consumer (Rs.60/- kg) – Rs.6100/-

Rs. 4100 /-

Value Chain of Acid Lime (Input 85 kgs raw material)

Farm level price Rs.750 /-

Transport charges: Rs. 150/-

Profit to Trader 20%Rs.180/Sale Price to Retailer Rs. 1080/-

Profit to retailer 30% - Rs.324 /-

Final price to consumer (Rs.17/- kg) – Rs.1404/-

Rs. 900/-

Value Chain of Okra (for 100 kgs of raw material)

Farm Level Price Rs. 1205/-

Grading Charges Rs.100 /Packing&weighing charges 50/Transport cost Rs.200/-

Rs. 1555 /Packing material Rs.60 /-

Rs. 1615 /IQF Charges Rs.720 /-

Profit to Manufacturer 20% Rs.467/-

Rs. 2335 /Price to exporter Rs.2802 /-

Value Chain of Pomegranate (Input 1 tonne of raw material)

Farm level price Rs.20000 /-

Packing Material Cost ; Rs.1000 /Packing Charges : 875

Rs. 21875 /-

Transport & Handling Charges : Rs. 2000/-

Tomato : Profit to trader 40% Rs.9550 /-

Rs. 23875 /-

Sale price to Retailer: Rs.33425/-

Profit to Retailer 20% Rs.6685 /-

Final price to consumer (Rs.40 /- per Kg)- Rs. 40110/-

Value Chain of Sweet Lime (Input 1 tonne of raw material)

Farm level price Rs.4000 /-

Handling & packing Charges Rs. 600/-

Rs. 4600/-

Transport Charges Rs. 1000/-

Profit to trader 30% Rs.1680 /-

Rs. 5600 /-

Sale price to Retailer Rs.7280/-

Profit to Retailer 40% Rs.2912 /-

Final price to consumer (Rs.10 /- per Kg)- Rs. 10192/-

Cluster SWOT analysis Strengths ¾ Abundant availability of fruits and vegetables ¾ Availability of water, both for irrigation and processing ¾ Availability of other agri-products, e.g., chillies, Tamarind in large quantities ¾ Presence of more than 70 fruit and vegetable processing units ¾ Proximity to major Indian cities like Chennai, Tirupati and Bangalore ¾ Good Rail and road link ¾ Established local marketing channels ¾ Presence of various BDS providers relating to technology, marketing and finance within the cluster ¾ Exposure to export markets Opportunities

Weaknesses ¾ Inadequate product quality and standards ¾ Limited facilities for testing and research ¾ Poor effort on value addition and better shelf life ¾ Inadequate technical knowledge of local manpower ¾ Weak information channels ¾ Poor linkages with developmental institutions ¾ Limited geographical reach ¾ Weak linkage between farmers and processing units ¾ High handling losses of 15% ¾ High post-harvest losses of 20%

Threats/ Challenges

¾ Availability of abundant quantity of Mango, Banana and Guava in neighboring states of Tamilnadu and Karnataka ¾ Growing export and domestic demand for processed foods ¾ Encouraging state and Central Government Policies on food related industries

¾ Growing competition from related clusters like Pune and Bangalore ¾ Increasing incidence of bacterial and viral diseases in papaya, lime and pomegranate and difficulty in control ¾ Global economic recession affecting export market ¾ Stringent food safety norms of developed countries like USA, Japan and other European Countries

Analysis of critical gaps identified • Poor quality Inadequate product quality and standards prevented firms from reaching out to distant markets outside the state and limited their ability to export those products • Primitive Processing Technologies Majority of the processing units are confined to routine grading, pulping and general packing practices

but are not adopting ascetic packaging, ripening through

controlled atmosphere or eliminating bacteria through vapor heat treatment and irradiation due to lack of knowledge and insufficient capital.

•

Lack of facilities for testing

Facilities in the cluster are unable to match increasing demand for testing. No state of the art laboratory exists in the cluster and the entrepreneurs have to test the samples either at Chennai or Bengaluru leading to higher costs. •

Lack of adequate common facilities

At present the clusters has seven aseptic packing units, two IQF plants and one Vapor Heat Treatment plant, but are not able to cater to growing demand for the facilities. Even the cold storage facilities are very limited and scattered. •

Poor processing facilities at district Level

Lack of adequate primary processing centres for washing, sorting and grading in Kadapa, Chittoor, Nellore and Anantapur districts leading to low price realization by farmers •

Inadequate technical knowledge of local manpower

Formal technical (production & legal) knowledge of the farmers and small entrepreneurs was limited. Most of the entrepreneurs in the cluster were from the small scale sector, who had acquired business skills and technical knowledge through experience rather than through formal training. Lack of technical knowledge crowded out any developmental agenda. •

Weak information channels

Information is a critical necessity, particularly in a high price and quality sensitive industries like processed foods. However, information on issues like rights and obligation of the industry, food standards, sources, price and availability of raw material, new markets, etc. are not available.

Thus the absence of trained manpower, information channels, testing facilities, infrastructural facilities is becoming critical hindrances to the growth of the cluster.

Suggested interventions In order to meet the challenges of quality norms, particularly for exports and niche domestic markets, backward linkages with producers (farmers) need to be strengthened with farmers networks and contract farming.

Quality up gradation to meet international food safety standards needs further deepening to culminate in the emergence of specialized production units. Moreover these units will be in great need of support of specialized marketing firms.

Establishment of common facilities relating to aseptic packaging, Multiple Cold Storage, Vapor Heat Treatment and IQF in a centralized location and common grading, washing and sorting facilities in suitable areas at district level assure significance.

Establishment of a common information cum display centre to provide information relevant to all the players in the value chain, including farmers, intermediaries, technical agencies, processors, markets and their channels etc. in also critical. There is a need to coordinate this effort with local BDS providers in information technology.

The food sector is still highly regulated. Though several efforts were made in the past to help the Government streamline food laws and regulations, It is important to establish a centralized body (like a central processing centre) which is to join hands with local product level bodies (like primary processing centres) to enhance the effectiveness of such efforts. Capacity-building of farmers, local organizations, entrepreneurs is essential for quality up gradation and strengthening of backward linkages.