Saurashtra fast emerging as peanut butter hub
Make butter to earn better. That’s the new mantra being chanted by peanut producers of Saurashtra, which produces 65% of the country’s total groundnut crop, but only one peanut butter maker.
By Tapash Talukdar, TNN |
RAJKOT: Make butter to earn better. That’s the new mantra being chanted by peanut producers of Saurashtra, which produces 65% of the country’s total groundnut crop, but only one peanut butter maker.
Thanks to the great Indian retail boom, it has suddenly dawned upon the groundnut producers of this region that there lies huge market for peanut butter in domestic markets. And if economies of scales are achieved locally, the untapped exports market will be an extra slice.
Some of the mid-sized groundnut producers are already chalking out plans to manufacture, brand and sell peanut butter. Peanuts are exported from Saurashtra to Europe and far-east countries. Companies in these countries procure huge stocks from India and use it for manufacturing butter to sell under their own brand names to the US, UK and Australia and India as well.
Hiteshbhai Sata, one of the leap peanut exporter told ET that at least three producers are planning to set up manufacturing facilities for peanut butter in the next year with an initial capacity of more than 100 metric tonnes per day.
“Many producers are showing interest in setting up this facility and are in the process for land and machinery,” said Mr Sata, who is also a consultant for these projects.
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Taking a cue from China, which has established more than 100 units in a short span, Saurashtra producers is planning to start huge production at their upcoming units to meet domestic supply and exports to Canada, the US and European nations. The machines would be imported from China. The overall cost to set up a peanut butter unit would be around Rs 2 crore including land.According to industry sources, India’s contribution in trading of peanut butter has decreased from 2,056.2 tonnes in ’04-’05 to 1,830 tonnes in ’05-’06, mainly due to higher cost and a flatoxin levels in finished products. Though India is world’s second largest producer of peanuts in the world, its share in the world market is restricted to raw peanuts, with negligible contribution in value added products like peanut butter.
Bajaj Foods is the only peanut butter manufacturer and exporter in Gujarat. It exports to 22 countries and produces close to 350 mt per day, mostly for exports.
“Large numbers of local consumers are demanding of peanut butter, which is not widely available due to short supply,” says Gautam Bajaj, chairman of the company. He said that international demand is growing at about 15 % per year. In the last four years, Rajkot has replaced Mumbai as ’Peanut exports hub’, says Mr Sata.
Last year, India exported nearly 3.8 lakh mt to countries like the UK, Russia, Indonesia, and the Philipines other than EU countries out of the total production of 34 lakh mt. It is estimated that 89 % of the households in the US relish this bread spread.
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