<div>One of the top 10 countries in the world in terms of cultivable land under organic certification, India has an organic food market estimated at around Rs 1,000 crore. According to a study prepared by industry body Assocham and TechSci Research, the Indian organic food market is growing at a strong 25-30 per cent rate, and is set to touch the $1.36 billion-mark by 2020. <br /><br />The study did, however, place constraints in terms of awareness. The level of awareness about organic food products in India is extremely low and is limited to consumers in metro cities, it said. While more growth is expected in future, as the government increases support, leaders in the industry spoke to Deccan Herald about its charecteristic features.<br /><br />“Around 15 years back, people weren’t very particular about what they were eating. Even when we started in 2007, the first few years saw a lot of struggle. However, now, that is seen to be changing. Over the past two years, we have seen good traction, mostly for having been there. Also, consumer interest has improved now, with mounting interest in health, wellness and fitness in India,” said N Balasubramanian, Chief Executive Officer, 24 Mantra Organic. 24 Mantra Organic is a leading organic food brand based out of Hyderabad. The company claims a 60 per cent share of the organic market (which does not include tea) in India, and is followed by brands like Pro Nature and Organic Tattva. <br /><br />“Overall, organic food consumption in India is at 0.25 per cent and is set to touch two per cent by 2020,” said Shailesh Mehta, CEO and Co-Founder of JoyByNature.com, quoting Dr Lorenzo Boni, project manager assistant of Bioagri Coop, an Italy-based non-profit organisation that contributes actively to the promotion and development of organic farming and sustainable development. <br /><br />JoyByNature.com is an online natural and organic products store housing authentic and certified organic, ayurvedic and natural products. Mehta notes that Indians have a natural tendency towards natural, herbal and organic, given that the price differential is not high. “With a rich history of nature-based cures and therapies in India, awareness is there. The bigger issue is that of availability and affordability,” Mehta said.<br /><br />Foody awareness <br />Vipul Mittal, National Category Head, Fruits and Vegetables at Supermarket Grocery Supplies, which owns and manages BigBasket.com, concurs, saying, “Over time, there has been a surge in customer awareness, and we have seen an informed shift towards some organic products.” <br /><br />From a company perspective, Mittal said, “In the market for categories like kitchen staples and fruits and vegetables, which are like raw materials for cooking, branding never really caught up. Organic provides that much needed differentiation to create a niche.” <br /><br />Indian food basics potato, onion and tomato, within the fruits and vegetables category, and rice and wheat flour, within the kitchen staples category have been found to be the most popular products across the industry. It only goes to say that consumers making the shift to organic are in it for the long haul. <br /><br />The reverberating move towards wellness across the healthcare and fitness domains, has improved people’s understanding of the food mechanism in recent years, with food trends like organic food, veganism, fruitarianism, among others, catching up. Moreover, large sections of the educated urban masses have begun to see that the amount of money involved in medical expenditure is significantly higher than active healthcare. While organic food is one of the prominent aids for transforming towards a healthy life, it comes at a price.<br /><br />‘Cost of honesty’ bears down<br />For organic farming, firstly it takes three to four years for the soil to transform and get organic certification, second, the yield remains relatively low due to the lack of yield-boosting supplements in fertiilisers and hybrid seeds,” said Balasubramanian, about how it is just the ‘cost of honesty’ that puts pressure on the cost of production and therefore, prices. Premium pricing margins in the organic foods segment can range from as low as 10 per cent and may go up to 35-40 per cent. “The monthly food supplies basket for a family of four costs about Rs 4,000. If the family switches to organic wholly, the price may go up by Rs 1,200-1,400,” he said. <br /><br />Globally, 5-7 per cent of the consumer base is believed to have gone fully organic, he adds. Affordability plays a bigger role for those consumers, who Mittal categorises as ‘fence-sitters’. “These fence-sitters understand some bit about organic, but continue to be concerned about the price. If the pressure from prices can be mitigated, this lot can be converted.” Amongst kitchen basics, the premium is found to be lowest for wheat flour, where it is less than 20 per cent. It is higher for pulses, honey and groundnuts, among others, and can range anywhere between 35-40 per cent. <br /><br />“At any time competing with non-organic will be difficult,” he said, adding, “When people realise the benefits of organics, the price doesn’t pinch so much. At 24 Mantra Organic, being market leaders, we ensure that premiums are at a minimum, because we want to help people make the switch.” <br /><br />Additionally, the segment is harrowed by inconsistency in supply, especially for perishables. Here, Mittal calls for instituitional intervention. “Testing and standardisation for organic products is absent. There are process-based and field-based certifications, but no certification for the end product. This becomes a bigger problem for perishables,” he said. “Price premiums range from 30 per cent to even 300 per cent. By this standard, a shift in consumer behaviour may be far-fetched. Only when accessibility and affordability are resolved, can the larger portion of the consumer base, which does not understand organic, be approached,” said Mittal. <br /><br />Organic shines online<br />Market research firm 6Wresearch in its study has said that the online grocery market is set to grow at a CAGR of 62 per cent between 2016-2022. It further placed Bengaluru as the key market for online grocery, followed by Mumbai and Delhi. “The important thing to note here is that for non-organic products, online is just another channel of distribution; whereas for organic, eCommerce is more about market creation and customer acquisition,” said Mehta.<br /><br />With dedicated organic grocery portals, including Farm2Kitchen, MyGreenKart, GreenNGood, Down2Earth and GrocBay, vying for a share in the organic food market, the bigger online grocers are not far behind. Some 45 per cent of BigBasket’s product portfolio is consumed by kitchen staples and fruits and vegetables, and of this, 20 per cent is from the organic range. Organic products contribute up to 10 per cent of the total sales on the website, led by brand like 24 Mantra, Pro Nature and Organic Tattva.<br /><br />Balasubramaniam finds that across brick and mortar, and online stores, at least five per cent of the consumers are buying something organic. “If in the next five years, we are able to achieve even a five per cent penetration at a household level, we could be looking at a Rs 30-crore market in India,” he said. “Ultimately, it is about making organic the first choice of everything,” he said.<br /></div>
<div>One of the top 10 countries in the world in terms of cultivable land under organic certification, India has an organic food market estimated at around Rs 1,000 crore. According to a study prepared by industry body Assocham and TechSci Research, the Indian organic food market is growing at a strong 25-30 per cent rate, and is set to touch the $1.36 billion-mark by 2020. <br /><br />The study did, however, place constraints in terms of awareness. The level of awareness about organic food products in India is extremely low and is limited to consumers in metro cities, it said. While more growth is expected in future, as the government increases support, leaders in the industry spoke to Deccan Herald about its charecteristic features.<br /><br />“Around 15 years back, people weren’t very particular about what they were eating. Even when we started in 2007, the first few years saw a lot of struggle. However, now, that is seen to be changing. Over the past two years, we have seen good traction, mostly for having been there. Also, consumer interest has improved now, with mounting interest in health, wellness and fitness in India,” said N Balasubramanian, Chief Executive Officer, 24 Mantra Organic. 24 Mantra Organic is a leading organic food brand based out of Hyderabad. The company claims a 60 per cent share of the organic market (which does not include tea) in India, and is followed by brands like Pro Nature and Organic Tattva. <br /><br />“Overall, organic food consumption in India is at 0.25 per cent and is set to touch two per cent by 2020,” said Shailesh Mehta, CEO and Co-Founder of JoyByNature.com, quoting Dr Lorenzo Boni, project manager assistant of Bioagri Coop, an Italy-based non-profit organisation that contributes actively to the promotion and development of organic farming and sustainable development. <br /><br />JoyByNature.com is an online natural and organic products store housing authentic and certified organic, ayurvedic and natural products. Mehta notes that Indians have a natural tendency towards natural, herbal and organic, given that the price differential is not high. “With a rich history of nature-based cures and therapies in India, awareness is there. The bigger issue is that of availability and affordability,” Mehta said.<br /><br />Foody awareness <br />Vipul Mittal, National Category Head, Fruits and Vegetables at Supermarket Grocery Supplies, which owns and manages BigBasket.com, concurs, saying, “Over time, there has been a surge in customer awareness, and we have seen an informed shift towards some organic products.” <br /><br />From a company perspective, Mittal said, “In the market for categories like kitchen staples and fruits and vegetables, which are like raw materials for cooking, branding never really caught up. Organic provides that much needed differentiation to create a niche.” <br /><br />Indian food basics potato, onion and tomato, within the fruits and vegetables category, and rice and wheat flour, within the kitchen staples category have been found to be the most popular products across the industry. It only goes to say that consumers making the shift to organic are in it for the long haul. <br /><br />The reverberating move towards wellness across the healthcare and fitness domains, has improved people’s understanding of the food mechanism in recent years, with food trends like organic food, veganism, fruitarianism, among others, catching up. Moreover, large sections of the educated urban masses have begun to see that the amount of money involved in medical expenditure is significantly higher than active healthcare. While organic food is one of the prominent aids for transforming towards a healthy life, it comes at a price.<br /><br />‘Cost of honesty’ bears down<br />For organic farming, firstly it takes three to four years for the soil to transform and get organic certification, second, the yield remains relatively low due to the lack of yield-boosting supplements in fertiilisers and hybrid seeds,” said Balasubramanian, about how it is just the ‘cost of honesty’ that puts pressure on the cost of production and therefore, prices. Premium pricing margins in the organic foods segment can range from as low as 10 per cent and may go up to 35-40 per cent. “The monthly food supplies basket for a family of four costs about Rs 4,000. If the family switches to organic wholly, the price may go up by Rs 1,200-1,400,” he said. <br /><br />Globally, 5-7 per cent of the consumer base is believed to have gone fully organic, he adds. Affordability plays a bigger role for those consumers, who Mittal categorises as ‘fence-sitters’. “These fence-sitters understand some bit about organic, but continue to be concerned about the price. If the pressure from prices can be mitigated, this lot can be converted.” Amongst kitchen basics, the premium is found to be lowest for wheat flour, where it is less than 20 per cent. It is higher for pulses, honey and groundnuts, among others, and can range anywhere between 35-40 per cent. <br /><br />“At any time competing with non-organic will be difficult,” he said, adding, “When people realise the benefits of organics, the price doesn’t pinch so much. At 24 Mantra Organic, being market leaders, we ensure that premiums are at a minimum, because we want to help people make the switch.” <br /><br />Additionally, the segment is harrowed by inconsistency in supply, especially for perishables. Here, Mittal calls for instituitional intervention. “Testing and standardisation for organic products is absent. There are process-based and field-based certifications, but no certification for the end product. This becomes a bigger problem for perishables,” he said. “Price premiums range from 30 per cent to even 300 per cent. By this standard, a shift in consumer behaviour may be far-fetched. Only when accessibility and affordability are resolved, can the larger portion of the consumer base, which does not understand organic, be approached,” said Mittal. <br /><br />Organic shines online<br />Market research firm 6Wresearch in its study has said that the online grocery market is set to grow at a CAGR of 62 per cent between 2016-2022. It further placed Bengaluru as the key market for online grocery, followed by Mumbai and Delhi. “The important thing to note here is that for non-organic products, online is just another channel of distribution; whereas for organic, eCommerce is more about market creation and customer acquisition,” said Mehta.<br /><br />With dedicated organic grocery portals, including Farm2Kitchen, MyGreenKart, GreenNGood, Down2Earth and GrocBay, vying for a share in the organic food market, the bigger online grocers are not far behind. Some 45 per cent of BigBasket’s product portfolio is consumed by kitchen staples and fruits and vegetables, and of this, 20 per cent is from the organic range. Organic products contribute up to 10 per cent of the total sales on the website, led by brand like 24 Mantra, Pro Nature and Organic Tattva.<br /><br />Balasubramaniam finds that across brick and mortar, and online stores, at least five per cent of the consumers are buying something organic. “If in the next five years, we are able to achieve even a five per cent penetration at a household level, we could be looking at a Rs 30-crore market in India,” he said. “Ultimately, it is about making organic the first choice of everything,” he said.<br /></div>