In Conversation with ThinkAg Member Godrej Agrovet
Introduction to Godrej Agrovet
Indian agriculture is a production powerhouse of the world. It has come a long way from acute food shortages & famines in the 1960s to report a surplus today. Despite these massive achievements, per hectare/animal yield in India continues to be one of the lowest. Keeping in view the country’s rising population and the need to increase farmers’ profitability, yield improvement is imperative.
At Godrej Agrovet, we are dedicated to improving the productivity of Indian farmers by innovating products and services that sustainably increase crop and livestock yields. Godrej Agrovet Limited is a diversified, research & development focused agri-business company. We hold leading market positions in the different businesses in which we operate - Animal Feed, Crop Protection, Oil Palm, Dairy and Poultry and Processed Foods.
Our Animal Feed business is one of the largest organised players in the Compound Feed market in India, with annual sales of more than a million tonnes across cattle, poultry, aqua feed and speciality feed. All our feed offerings are formulated with a deep understanding of the nutritional requirements of different breeds.
Our teams have worked closely with Indian farmers to develop over 61,700 hectares of smallholder Oil Palm Plantations to bridge the demand and supply of edible oil. We have plantations across Andhra Pradesh, Goa, Gujarat, Orissa, Tamil Nadu, Maharashtra and Chhattisgarh. In 2015, we commissioned an oil palm mill in Mizoram as well. It is one of the largest private-sector investments in the state.
In our Crop Protection business, we meet the niche requirement of farmers through innovative agrochemical offerings. We have a strong market share in plant growth promoters, soil conditioners and cotton herbicides. Our portfolio offers a range of products that cover the entire life-cycle of a crop. A robust, pan-India distribution channel of over 6,000 distributors, helps ensure wide reach across the country.
Continuing the business growth story, we acquired promoter holding in Astec Life Sciences Limited in 2015. Astec is a business-to-business tech, bulk manufacturer of fungicides in India. It also has a contract manufacturing presence and counts multinational Agrochemical companies among its clients. It has established a successful track record in nurturing stable and long term relationships with highly reputed companies in the U.S.A., Europe, West Asia, South East Asia and Latin America.
In line with our ambitions of expanding our presence in the "Animal Protein" space further, we acquired a controlling stake in Cream Line Dairy Products Limited - a leading Dairy player in South India. The company has a significant presence in Andhra Pradesh, Telangana, Tamil Nadu, Karnataka and Maharashtra, under the "Jersey" Brand name. It also has a very interesting value-added product portfolio like Curd, Flavored Yogurt, and Ice Cream among others.
In 2004, we entered into a joint venture with the Advanced Chemical Industries Limited (ACI) Group from Bangladesh, to manufacture and sell Compound Feed. The ACI-Godrej Agrovet joint venture ranks among the top three feed companies, across all categories in Bangladesh.
Our poultry business, Godrej Tyson Foods, best known for two brands, Real Good Chicken and Yummiez, is a joint venture with Tyson Foods, one of the largest poultry processing companies in the world. Godrej Tyson Foods is the second-largest player in the processed poultry segment in India.
2. How does Godrej Agrovet approach innovations in terms of the company's culture?
Innovation is a key driver of our strategy. We are constantly experimenting and looking for research-based solutions to improve farm productivity and thereby, the profitability of farmers. For example, Milk More, our innovative cattle feed, improves the yield of high milk-producing animals. Our Crop Protection business has developed exclusive products like Vipul, Vikas, Combine and Hitweed to offer a complete crop protection solution.
A large part of our innovation is focused on product development. We are investing significantly in cutting-edge Research & Development to support our innovation pipeline. Nadir Godrej Centre for Animal Research and Development in Nashik, Maharashtra is a one-of-its-kind animal husbandry research centre in the private sector in India. Our focus will be to leverage capabilities at this centre, to develop cost-effective solutions to improve animal productivity.
3. What is your view on the adoption of new technologies in the Indian food and agri landscape? In your view can this be accelerated and how?
Farmer profitability and incomes have been one of the key challenges marring the sector in recent times. Besides declining prices, we believe, approach towards agriculture in India has been a roadblock to its financial development. Indian agriculture, for years, has been considered a ‘production-oriented activity’ carried to achieve food-security and not as a ‘business activity’.
In the past few years, there has been a policy shift in agriculture from production to profits. Initiatives like ‘Doubling Farmers’ incomes’ and ‘Ease of doing Agribusiness’ have been an output of this change.
Successful business ventures are based on well-informed decisions. For a farmer to turn into a businessman, he/she needs to make investments in their farms with calculated goals. To undertake this, external parameters like market demand & supply situations, weather data, price discovery etc. become a catalyst. Technology can be an aggregator of these parameters. We believe the adoption of technologies is the most effective way to turn agriculture into a business activity.
The ag-tech scene is abuzz in India with a plethora of technological innovations and start-ups. It is estimated that India houses around 4200 start-ups and expected to reach over 11,500 by 2020. These start-ups are providing missing links in the agri value chain. They are distributing efficient products, technologies and services to the farmers on one hand and the consumers on the other. From ICT apps to farm automation, weather forecasting to drones, inputs retailing & equipment renting to online marketing, smart poultry dairy ventures to smart agriculture and innovative food processing & packaging - the proliferation of all innovations and technology-driven start-ups is set to revolutionize the food and agriculture sector.
We believe affordability is the key to adoption of technology in agriculture. Affordable and easy-to-use technology has the potential to transform India’s agri landscape.
Technology-led revolution in delivery logistics is already underway in India’s food industry. Going-forward, focussed technological innovations and adoption in food-processing & packaging has the potential of having a multiplier effect on the growth of India’s food industry.
4. You have been interacting with young entrepreneurs wanting to add value to the existing systems and processes. What do you look for when you partner with them?
Primarily we evaluate the potential business impact of the solution. Typically we undertake pilots where we establish a base case and measure the impact of the solution. If the pilots are successful then we’ll implement at scale.
5. What is Godrej Agrovet's process and approach when it comes to engaging with emerging agtech innovators? How can an innovator approach you with their solution?
We do not have a formal approach as such. We’ve participated in accelerator programs, we’ve ourselves sought out certain companies with our problem statements and sometimes they’re referred to us through mutual connections. We’d love to get in touch with more Ag Tech innovators. They can reach us at email@example.com