Transcript full presentation

Dairy, Rice & Meat Exports
Challenges & Opportunities
Agriculture Export Development Seminar
28 March 2011
Ahsan Afzaal Ahmad
General Manager Marketing
Engro Foods Limited
Significance of Milk
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Pakistan 5th largest milk producer
56.6 mil animals and 36.6 bil liters milk
10+ million farming families
Staple food of 175+ million people
11% contribution to GDP
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Milk Rs 341 bil
Wheat Rs 150 bil
Cotton Rs 100 bil
Rice Rs 71 bil
Milk Production Flow
%
100
Billion Liters
36.6
useless
Sweets
6.7 Bio
3.2 Bio
13.3
1.2
Powder
80
Yogurt
Farmer
Retention
60
18.9
0.415
2.4 Bio
Chilled
11 Bio
Unprocessed
0.045
12.1 Bio
40
Liquid Milk
Tradable Milk
13.3 Bio
Ambient
18.9 Bio
0.716
20
Processed
1.2
0
Milk Production
Tradable Milk
Processing
Packaged
Key Dairy Challenges
• Quantity
– Supply-demand deficit of 4 bil liters by 2015
• Quality
– High TPC reducing shelf life
– Adulteration
• Cost
– Drastic increase in farm gate prices (+15% from 2006)
– Shrinking processor margins
Milk Quality Implications
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Major hurdle for export opportunity and value addition
Average TPC in Pak 3+ mil/ml vs 50k in Middle East
Shelf life 3 month vs 6 month in Middle East
Adulteration
What Needs to be Done
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Prioritize milk shed areas for investment
Incentives on chillers infrastructure investment
Minimum pasteurization law
Incentives for corporate dairy farming
Improved breeding and farming practices
Better fodder management
Regulatory framework to encourage quality
Milk Global Opportunity
• In a growing world, milk is the new oil
• Increasing demand-supply gap leading to high
prices and diminishing dairy stock piles
• Rising incomes – China, India, Middle East
• Asia has replaced Europe as largest
consumption zone
• Reducing subsidies and tariff controls
• Value addition
Rice Opportunity & Challenges
• Pakistani rice possesses superior cooking characteristics
• Exports of 1 million tons of Basmati rice annually – predominantly
Super Basmati
• Despite superior quality, it sells at discount
• Key challenges are:
– Low quality parameters enforcement for export
• Capacity building of regulators
• Adequate technology
– Reliance on single variety
• Expedite R&D for new high yield varieties (farm & milling)
– Inadequate paddy drying infrastructure (aflatoxin)
• Farmer education on harvest time to control moisture
• Incentives to encourage drying units
• Engro procuring paddy directly from farmers, extensive agri services
provided, launch seed distribution in 2012
Meat Opportunity & Challenges
• Recent acquisition of a Halal meat company in
North America (Al-Safa)
• Understand market and develop alliances
• Currently meat can not be exported from
Pakistan to North America (quality &
certification)
• Expand business into grains and fruits
• Focus on Middle & Far East and Central Asia