Food Processing Industry Bracing for Transformation

Improving income earning opportunities in rural areas and addressing the root causes of migration is much needed. People have started migrating from rural areas to urban areas in search of better paying jobs and in search of livelihood betterment. And in order to meet the food demand, for the growing urban areas, enough arable land is required along with skilled labor for each division of labor.

Gaps in the supply chain infrastructure
In India, due to lack of proper supply chain management, 16 per cent of fruits and vegetables are being wasted every year as per a study “Assessment of Quantitative Harvest and Post-Harvest Losses of Major Crops and Commodities in India” by the CIPHET. There is a lack of proper communication channel in each layer of the supply chain. Improper communication between farmers/ producers and buyers/ food processing companies, improper placement of the factories, energy and fuel costs also affect the supply chain of the products leading to inadequate primary processing, affecting storage and distribution facilities. Some of the leading companies are dealing with this by doing research in acquiring data for analyzing the future demand and manufacturing with respect to that. Adapting to latest technologies, innovation with food processing processes are some more examples as how these problems are met.

Usage of outdated technologies
Manual inspection for the quality of products is time consuming. The small scale companies in the food processing Industry find it not feasible to adapt to new technologies as they are not available at an affordable price. The companies currently rely on manual inspection of rice in order to identify the quality of rice. Also, there is a major use of Excel sheets instead of proper IT infrastructure to manage the goods. Technologies such as Machine Learning, and neural networks could provide a fast track and efficient results. Some of the leading companies use cameras, lighting and Machine Learning in order to grade their rice. They are also focusing increasingly on investing in digital tools and advanced technologies, zeroing in on data integration to create a clearer picture of the individuals and households buying their products.

Non- accurate forecast of demand
Without an accurate prediction of the future demand, excess production of goods such as sugar has been done. Overproduction has led to the downfall of the price for that commodity. This in turn affects the seller. Assessing the future demand would be beneficial for fixing the price and also to avoid wastage of produce. In order to do that, a wide survey and research is needed among the target customers.
Adapting to the latest trends and going in accordance with technology would improve the industry. And the latest technology that is compelling us to look at is the Blockchain technology.

Blockchain technology
Blockchain is a distributed ledger technology that allows data to be stored globally on thousands of servers while letting anyone on the network see other’s entries in real time. The blockchain technology provides security for the data. It provides reliability, traceability for all the participants involved in the system. After an input is provided to the system, changing the data is difficult. This lets the farmers to fix the price and reduce the food frauds. The farmers can store essential information related to the type of crops, its quality and the weather condition using IoT sensors. After the crops are cultivated, the bidding for the crops can be done. After that, the crops are transported to the storage facilities of the winning bidder.

The crops can then be processed. The processed food products are again entering the bidding platform where the wholesaler and retailers bid for the products. The wholesalers and retailers now sell it to the end customers. All these processes are now back traceable for the end customer. This gives access for the customer to know about the manufacturing location, the farm origination details, expiration detail and so on.
Implementing blockchain technology could be seen as a promising solution for many of the problems prevalent in the Industry. Amid the growing fears in the minds of the people regarding the quality of the products, blockchain technology offers traceability of the products to the grass root level. The maintenance of records would also be eased.

The foreseeable future
In spite of the various challenges faced by the Food processing Industry in India, it is expected to make steady progress with the entry of many international companies and rising demand for processed food locally and internationally. The sector will continue to witness increase in demand for food processing units from the manufacturers.