India is among the world’s leading producers of milk, food grains (cereals and pulses), and fruits and vegetables. In addition to these products, our country also produces ample quantities of sugarcane, cotton, fish and poultry. That India has a food scarcity problem because we do not produce enough is a myth.
In 2019-20, India’s total production of food grains reached a record high of 296.65 million tonnes and total horticultural production peaked at an all-time high of 320.48 million tonnes.
The real crux of India’s food scarcity issue is its fragmented supply chain that makes the entire agricultural ecosystem complex for all stakeholders. It takes anywhere between 7 to 11 steps for food to travel from farm to fork i.e., from the farmer to the consumer!
Moreover, the lack of seamless information flow between stakeholders of the agri value chain poses a major hurdle. Timely and accurate information must be available with all market participants in order to avoid high levels of food loss. The limited demand visibility with food producers results in disrupted supplies, volatile prices, low remuneration for farmers, and uncertain supplies and prices for discerning consumers.
According to a UN report, an estimated 931 million tonnes of food was wasted globally in 2019 with India alone losing food equivalent to the total amount of food consumed by Brazil.
To rejuvenate the country’s food economy, India needs to reimagine a tech-driven supply chain that:
An integrated tech platform is pivotal for supply and demand planning at both macro and micro levels. Such a platform will serve as an ecosystem not just for farmers and consumers, but also for other stakeholders like processors, Warehouse Service Providers (WSPs), logistics providers, and retailers.
By bringing all the stakeholders on an integrated tech platform, not only will we create a cohesive, transparent ecosystem, but also boost efficiencies by eliminating inaccuracies in demand and supply planning.
Leveraging such a platform will help:
This real-time visibility significantly improves planning and ensures that all stakeholders are working in tandem.
Long-term demand forecasting models will help farmers grow the right crops based on the forecast and the soil content. Several models around growing techniques and packaging practices can also help them accurately predict product yields and enhance their income.
Retailers can leverage the embedded analytics models for consumer insights to understand what commodity sells in a particular community and stock the relevant products accordingly. With advancements in technology, we can even go to the extent of predicting which variant of rice or fruits and vegetables are more likely to be consumed in which street! These detailed insights help retailers stock the right Stock Keeping Units (SKUs) that not only improves their earning capacity but also avoids wastages of slow-moving stock.
For the supply chain players, predictive analytics is core to demand planning. They can use the forecasts and supply information to run network optimisation as well as reduce Food Miles thereby minimising food loss.
Once enough information is fed into the tech platform, it becomes easy to analyse how much produce can be generated from a particular region as well as the consumption pattern in surrounding regions to make a sound decision. The same insights can then be shared with the farmers to make informed decisions.
When one deals with food and perishables, there are two critical elements from a logistics perspective – ensuring that the produce moves from the source to the consumer in the shortest possible time, and minimising the physical handling of the produce as every human touch reduces the shelf-life of the product.
Automation is not just a strategic lever but an important cog in the seamless management of the entire food supply chain. While we have seen the use of automation in food processing, it still remains sluggish in the rest of the supply chain, barring a few new-age players.
Automation has delivered phenomenal results in sectors such as the automotive and electronics industry. This could make way for frugal engineering solutions that ably support the complex cost structures in the food industry.
There are several use cases for automation in the food supply chain such as robots assisting in base-level functions of moving boxes or crates of the produce along conveyor belts, automated systems for grading, sorting, and dispensing precise quantities of grains as well as fresh produce into packing machines. Companies such as Ocado are building such solutions for developed markets. However, similar solutions are required for emerging markets at cost structures more suited for these markets. Besides increasing productivity, these solutions reduce effort and errors, and improve ergonomics, factors that are as important in emerging markets as they are elsewhere.
Automation can also be used in sorting and grading processes based on the quality of food grains and fresh produce. Examples include IoT-integrated decision conveyor systems that automatically match the supply crates to specific customer orders and allow produce to seamlessly flow through fulfilment centres without any human intervention.
Three is the key
From a process maturity viewpoint, food tech and especially agri-commerce is just evolving from a diagnostic stage to a better defined predictive and prescriptive model. Once this transition is completed, opportunities are immense not only in reducing food wastages but across different elements of the supply chain.
The three key elements – an integrated tech platform, embedded analytics and automated supply chain – must seamlessly interconnect to truly get to the core of solving India’s food scarcity issue. WayCool is consistently working towards it and redefining India’s food supply chain to ensure food security.
