Contract farming system is considered as one of the potential business models to link smallholders to world export markets along the stable supply chain. India has made significant advances in agricultural production in this past decade, through introduction of high-yield seed varieties, increased use of fertilizers, improved water management systems and farmer friendly government policies. Studies suggest that agriculture is the primary source of livelihood for about 58 percent of India’s population, with rapid population growth being the primary driving factor for the Indian agri market. This is further supported by the inflating rural and urban income levels that have led to the growing demand for agricultural products across the country. However, the agri market is still grappling with a number of problems, and one of the primary issues include lack of suitable expertise and infrastructure to properly manage, store and transport perishable goods like fresh fruits, vegetables and flowers.
Flora Trading, a Karnataka-based grower, distributor and exporter of agricultural products aims to tackle this challenge through development of state-of-the-art preservation and transportation solutions for perishable agri products. Flora Trading’s primary offering for their clients is contract farming as well as exporting agri products to overseas markets.
Talking about current problems agri market is facing
with management of perishable goods, Founder Louis Fernandes says, “From farm to fork, fruits and vegetables undergo a long journey and hence require special care and treatment during the entire process. Perishable goods, which include fruits, vegetables and flowers, decay rapidly if not refrigerated, or if some other preservation technique is not employed.
These items need to be shipped under strictly controlled temperature and storage conditions. And India being the second largest producer of fruits and vegetables in the world and the second largest vegetable exporter, we at Flora tackle this challenge strategically. We select an appropriate mix of temperature and relative humidity conditions for each commodity type as each commodity has a different rate of water loss and air pressure sensitivity. ”International buyers were diversifying their sources of supply in the wake of the pandemic. “For example, the Middle East countries will be keen to import fruits and vegetables from diverse sources such as contract farming companies, both fresh and as well as processed products”, he said.
A Pioneer Player
Over the years, Flora Trading has developed suitable expertise, tech, and infrastructure, to provide advanced & customized contract farming solutions to their clients. Flora’s contract farming solutions have opened up new markets which would otherwise be unavailable to small farmers. The firm focuses on ensuring higher production of better quality, financial support in cash and/ or kind and technical guidance to the farmers.
Food safety has gained immense importance over the years due to its impact on the health of consumers and the growth in the agriculture commodity trade in food products, therefore our team at Flora Trading produce all agri products under required safety conditions to protect consumers from the hazards of foodborne illnesses. The quality approved assortment of vegetables has helped the organization set up a large customer base both in domestic and international markets.
Plan Ahead
Flora Trading started their journey with a single product in 2018 but now the firm boasts of more than 15 agri products with a farming community of 75 small scale farmers. Their strategic system is designed to completely bypass the middlemen, thus directly benefiting farmers and the export company. Flora has in-house farming facilities for their agri products which they also export on behalf of their clients by partnering with export companies, unlike other exporters who require to deal with middlemen/brokers.
Talking about future plans for Flora Trading, Louis Fernandes shares, “Our air export volumes have witnessed an increase from one ton per day in 2019 to 15 ton per day in 2022. This is a remarkable progress which we want to build on. We plan on getting more and more farmers on board with us, which essentially means we have good potential to reach 30 ton per day export capacity by air by the end of year 2022”.
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