McCain Foods India Private Ltd retails frozen potato products like fries, tikkis and wedges. It also supplies these to McDonald’s, the American fast food chain. Ten years after McD’s set up its first outlet in India, at Delhi’s Basant Lok in 1996, McCain began contract farming operations in Gujarat’s Banaskantha district. It has a processing plant at Mehsana. McCain thought of sourcing potatoes initially from Punjab but found the winter not conducive for potato growth. So it settled on Gujarat.
The family-owned Canadian company shuns the media. Here are rare insights from the managing director of its India operations, Vikas Mittal, from his address at industry-chamber Ficci’s seminar on doubling farmers’ income with “smart” marketing solutions.
- Though India is a large producer of potatoes, only two percent of them can be processed (because potatoes for French fries have to be oblong, high in solids and low in sugars so they do not caramelize upon frying and turn brown. For wafers they have to be round).
- There is little debate in India on processable quality. The share of processable varieties in any fruit and vegetable in India is in the single digits. Worldwide the share is more than 50 percent.
- World over the bulk of produce is processed; the question to be asked in India is how do we connect farmers with processing industry.
- Gujarat was not a potato-producing state. It became so by collaborating with McCain.
- The losses in warehouses, storages and during transportation are nowhere to the standards we like. (Sukhpal Singh, Professor, Centre for Management of Agriculture, Indian Institute of Management, Ahmedabad, says estimates about wastage of fruits and vegetables in India are exaggerated. Except in tomatoes, it is is about 10-12 percent, and not 30-40 percent, as is commonly believed. There is value loss as lower quality is sold at a lesser rate, he says, but little is thrown away).
- We can stretch the life of any fruit or vegetable crop by 8 to 12 months (perhaps he means through protected farming in poly houses). Farmers must be given the right technology and provided finance.
- Farmers’ income will double when they can sell throughout the year and not soon after harvest.
- Raising support prices is not the solution to raising farmers’ incomes. The solution is to reduce cost and improve yields. McCain has had some success in this respect in Gujarat.
- Mechanisation can be a “game changer.” For that we must have field sizes where machines can be deployed. Fragmentation is a social problem that must be tackled through land leasing and cooperative farming.
(Photo of Vikas Mittal by Vivian Fernandes).