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POTATO FLOUR

EXPORT POTENTIAL ANALYSIS Pradeep kumar 09020242026

Potato flour
‡ This is new product for India . ‡ It is widely consumed in western countries . ‡ The market potential is very huge both in India and for exports . ‡ Demand is more than the supply at present ‡ Only very few companies in India are manufacturing this product . ‡ So it s the right time to hit the market . ‡ Product has been proved highly useful in Indian Homes, Restaurants, Star Hotels, Snacks manufacturers, Fast Food chains .

‡ Adequate quantity of suitable chip varieties, which are used for powder making. ‡ Kufri Jyoti, ‡ Kufri Chipsona.

Introduction
‡ Potato flour is a flour which is produced from potatoes which have been cooked, dried, and then ground potatoes. ‡ It is commonly confused with, but is different than, potato starch flour which is made only from the starch of a potato. ‡ Potato flour is typically less dense and less white than potato starch.

Uses for Potato flour
‡ Ranging from Passover cooking to gluten-free baking. ‡ Potato flour is commonly used to produce compound potato chips . ‡ Potato flour is as a thickener. ‡ Potato flour can be added to soups, stews, gravies, and other dishes to encourage these dishes to thicken without adding a strong flavor or intense starchy texture.

Potato flour -Manufacturing

‡ Yield ratio of raw potatoes to flour is approximately 5.7:1. ‡ Higher recovery ratio of flour is from fresh potatoes and lower recovery ratio from stored potatoes ‡ Re-hydration ratio of flakes to mash potato is 1:5. ‡ Potatoes with high solid contents and low sugar are best to produce dehydrated products. These types of potatoes are widely available in India.

Machinery required

PLANT AND EQUIPMENTS:
‡ OPTION A: ‡ Chinese Technology: Machinery & Equipment's:
Description Equipment's cost Price (USD) 747,500 Price (Rs) 3,43,85,000

1 dollar =46 Rs
Capacity: Hourly output Daily output (18 hour operation) 6 month output (180 days) 12 month output (360 days) 500kg/hr 9 tonnes 1,620 tonnes 3,240 tonnes

PLANT AND EQUIPMENTS:
‡ European Technology: Machinery & Equipment's:
Description Equipment's cost Capacity: Line input Line output Line yield Recovery Ratio (Potatoes to flakes) Daily output (18 hour operation) 12 month output (360 days) 7,776 tonnes 6,814 kg/hr (Raw potatoes) 1,200 kg/hr (Flakes or flour) 18% 5.7:1 21.6 tonnes Price (Euro) 2,677,950 Price (Rs) 159338025

‡ 1 euro= 59.5

Potato Production- world wide
Area (average of 2007-2008) Rank Country Ha Production (average of 2007-2008) Rank Country Mt

1 2 3 4 5

China Russia Ukraine India Poland

4,630,454 3,195,433 1,599,000 1,255,667 921,129

1 2 3 4 5

China Russia India USA Ukraine

68,892,594 34,860,837 23,191,200 20,513,490 17,487,833

World potato production, 1991-2007

Potato production, by region, 2007

Potato production, by region, 2007

‡ Asia and Europe are the world's major potato producing regions, accounting for more than 80 percent of world production in 2007. ‡ Harvests in Africa and Latin America were far smaller, production was at or near record levels. ‡ North America was the clear leader in yields, at more than 40 tonnes per hectare.

Potato consumption, by region, 2007

Potato consumption, by region, 2007

Cost of Cultivation Cost Production variable cost Seed and seed treatment Fertilizer and manures Plant protection measures Irrigation charges Machinery charges Hired labour Interest on working capital Sub-Total A Marketing cost Package expenses Transportation expenses to market Sub- Total B Gross Value Product Return over Production Variable Cost (Gross Return ± Production Variable cost A) Return over Total Cost (Return over Production variable cost ± Marketing Cost B) 9726 5043 888 624 2908 2764 1193 23147 2206 1474 3680 57015 33868 30188

Potato Flour Exports From India(2007-08)
Countries United States of America Indonesia Australia Singapore Yemen Iran Oman Bangladesh United Kingdom United Arab Emirates Algeria Kuwait Canada Jordan Quantity(Tonnes) 1764 740 278 206 200 151 151 100 97 76 47 46 39 38 Source- www.faostat.fao.org Value(1000 $) 879 576 124 106 73 200 146 18 39 47 39 24 20 58

Potato flour Exports from INDIA

Source- www.faostat.fao.org

Potato flour Imports of USA

Source- www.faostat.fao.org

Potato Flour World export scenario
Top Exporters Netherlands USA Germany Belgium France Other reporters Total Value (in Million) QTY (in Tonnes) Avg. Price/kg $100,430 $46,106 $38,763 $23,996 $21,296 $52,103 $282,695 88,583 61,526 33,398 19,747 13,988 55,613 272,855 $1.13 $0.75 $1.16 $1.22 $1.52 $0.94 $1.04

Source: United Nations Statistics Division - Commodity Trade Statistics Database

Global potato flour Imports

TARGET MARKETS

Supply Chain of Potato

TARGET COUNTRIES
‡ UK ‡ ITALY ‡ USA

‡ ITC HS number POTATO FLOUR- 110510

Main competitors in INDIA
Name Siddhartha Starch Potato King Foods Limited Shree Marketing & projects Place Pune Kolkata KOLKATA NEWDELHI Tamil Nadu Phone no +9102025651425 +(91)-(33)-24649271

Bharat Starch Industries Ltd Sree Rajendra Starch Products SRV India

WTO Tariff

International Pricing

Source: next tag 1 ounce= 0.0283495231

Packaging
‡ ‡ ‡ ‡ ‡ ‡ Export Retail: - Packets of (1) 250 gm. (2) 500 gm. (3) 1 kg. (4) 2 kg. (5) 5 kg.

Packaging Machinery

Manufacturing Requirement
‡ Potato powder recovery: 17% of the raw material. ‡ Cost of raw material: Rs 2500 per MT including all materials. ‡ Sale price of powder: Rs. 55000/ MT. to Rs 60000 / MT (depends on market) ‡ Power requirement: 20 HP to 60 HP depends on production capacity installed. ‡ Water requirement: a) 50,000 litres per day to 5,00,000 litres per day depending on production capacity.

Quality control and Statutory Requirements
‡ The unit needs to obtain a license under FPO 1955 from the Ministry of Food Processing Industry ‡ Clearance from State Pollution Control Board

Logistics
‡ Vayoodoot Logistics in India on FOB & FOR basis. ‡ Mr. J.B. Singhal M :9890004442 Mr. Ashwani Singhal M : 9890003999 Mr. Arun Singhal M : 9890004449

Logistics
‡ Minimum Order Quantity 10 tons

‡ To produce one kilo flakes or flour, the raw potatoes will cost approximately Rs. 28.50 (5 x 5.7) and the cost for one kilo imported market is Rs. 90. Therefore, a local manufacturer will have a margin of 68.33% to cover its other costs and make a handsome profit. ‡ The by-products of this process peel and cutting losses can be sold to cattle farmers to generate additional revenue and off-set the input cost of raw material.

STRENGTHS
‡ Cost of production in India is lower by about 40 percent. ‡ Large number of research institutions such as CFTRI, CIFT, NDRI, and NRDC. ‡ Infrastructure development (30 Mega Food Parks) ‡ Income tax rebate for setting up of new agro-processing industries ‡ Cumulative inflow of FDI into the food processing sector ‡ Growing number of fast food chains. ‡ The GOI is in the process of enacting a Food Safety and Standards Bill

Continued«
‡ A slow but steady transformation of the retail food sector in cities. ‡ India has the second largest arable land in the world. It has diverse agro-climatic zones. ‡ Competitive pricing also enables penetration in the rural markets.

OPPORTUNITIES
‡ GOI, in line with its Vision 2015 for the food processing sector, in its 11th Five Year Plan proposes to give greater thrust on infrastructure development. ‡ GOI envisages an investment of Rs. 1 trillion in the industry over the next five years, mostly from private sector and financial institution. ‡ Rising disposable income levels. ‡ Increasing urbanization and exposure to Western culture.

Continued«
‡Growing health consciousness among the middle class. ‡Growing consumerism. ‡Changing age profile. ‡Increasing availability of cheap consumer credit. ‡India is in the middle of two big markets the Middle East and the Far East and we can help French companies reach out to these markets.

WEAKNESSES
‡ Poor infrastructure still pose a serious challenge to FDI. ‡ Heavily bureaucratic investment processes, government inefficiency, and corruption have also discouraged foreign investors. ‡ India is still not holding its laws high for protecting copyright issues. ‡ Divergent food habits.

Continued«
‡ High tariffs, dated food laws, and unscientific sanitary and phyto sanitary restrictions. ‡ Lack of grading and standards, poor distribution channels, and onerous government policies. ‡ Low penetration of processed food in domestic markets. ‡ Out of the entire agricultural produce of India only 1% is converted into value added products. ‡ Lacks economies of scale, skilled manpower.

THREATS
‡ FDI and other routes of investments by MNC s pose a potential threat to a large number of Indian players in the coming years. ‡ Gradual decrease in no. of farmers practicing agriculture. ‡ Religious sentiments for different foods.

Thank You