India is among the top five agricultural economies in the world, with the sector providing livelihood to over 50% of the population and contributing nearly 18% to the country’s GDP.
Although advances in machinery, improvement in seed quality, irrigation techniques and fertilizer use, and the adoption of digital technologies have benefited the sector, modern-day challenges like climate change, increasing population, migration of agricultural populaces to cities have created more complex battles for the average farmer.
A new adversary, the Covid-19 pandemic, has further increased and exposed many of the flaws in the traditional supply chain and distribution systems. However, this new challenge is also an opportunity for retail brands to bridge the gap between themselves and the farmers, a chance to educate and help them adopt organic, profitable, environmentally friendly and sustainable practices.
Taking the organic route
There has been an increased consumer interest in preventive health practices, particularly since the outbreak of the pandemic and this, in turn, has fueled an interest in the organic food market. The organic food segment in India is expected to grow at a CAGR of 10% to reach Rs.75,000 crore (US$ 10.73 billion) by 2025..
Without the use of synthetic chemicals or growth hormones, as well as chemical-based pesticides and fertilizers, organic food products are empowering consumers to make healthier, cleaner, mindful and more sustainable choices. This is a growing trend, not just in the food segment, but also in the personal and home care spaces.
Organic and natural brands can play a key role in educating farmers about the importance of organic farming practices while maintaining profitability. Many brands are already providing non-GMO seeds, organic fodder for animals, organic pesticides and fertilisers to get farmers started on the journey. Some are also training the farmers in sustainable practices like cover cropping and mixed cropping to maintain the quality of arable land, regenerative farming methods that prioritize soil health, using practices like biochar, Navadhanya (multiple cropping), jeevamrutha and panchagavya as well as relying on natural cycles to ensure plant health and crop performance.
Connecting farmers to consumers
Retailers have the potential to streamline the supply chain, reduce the need for middle men, and work directly with farmer communities, thereby passing on a greater share of the profits to the farmers. With growing smartphone penetration, digital technologies have fueled the growth of B2B and B2C marketplaces globally, which are used to directly connect farmers to consumers and other stakeholders in the value chain.
Tackling food waste
A l study by the Central Institute of Post Harvest Engineering and Technology, Ludhiana (CIPHET), has revealed that on an average the food loss and waste in India is between 4.6% and 15.8%. This occurs during production, storage, and distribution – even before the food reaches the consumers.
With access to the right knowledge and dedicated funds, farmers and retailers can work together to address this huge challenge. For instance, solar-powered cold storage systems can help preserve the harvested crop and prevent waste, while mechanized irrigation systems and smart farm machinery can help automate processes and minimize food waste. Retailers can provide easy access to modern technologies through the entire agriculture value chain for farmers.
Building a thriving community
Retail brands can help build organic farming communities, powered by their strong networks and access to digital technologies and talent. By letting the consumers interact directly with farmers, where possible, and by giving a name, face, and human profile to their farmers, retail brands can help organic farming communities bring their stories straight from their farms to their consumers’ homes.
The use of social media, in the form of video clips to help consumers to get to know the farmer, the farm where the food is grown, along with the ethical and environmentally conscious farming practices adopted to produce the food, can play a key role in giving consumers an insight into the world of Indian agriculture.
Consumers are increasingly demanding to know where the food that they put on their plate comes from. Retailers can take innovations in blockchain and traceability to help drive this momentum in the market. Traceability along the production, supply and distribution chain is a unique value proposition that retailers can provide consumers and farmers as members of the community.
As one of the seven sectors that has the potential to contribute $2-$3 trillion in global GDP, according to McKinsey’s Center for Advanced Connectivity, the future of agriculture is organic. And new-age organic retail brands have the potential to create and maintain sustainable value chains through the fast-evolving industry.
Views expressed above are the author’s own.
Views expressed above are the author's own.
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