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Dairy, Rice & Meat Exports Challenges & Opportunities

Dairy, Rice & Meat Exports Challenges & Opportunities. Agriculture Export Development Seminar 28 March 2011 Ahsan Afzaal Ahmad General Manager Marketing Engro Foods Limited. Significance of Milk. Pakistan 5 th largest milk producer 56.6 mil animals and 36.6 bil liters milk

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Dairy, Rice & Meat Exports Challenges & Opportunities

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  1. Dairy, Rice & Meat ExportsChallenges & Opportunities Agriculture Export Development Seminar 28 March 2011 AhsanAfzaal Ahmad General Manager Marketing Engro Foods Limited

  2. Significance of Milk • Pakistan 5th largest milk producer • 56.6 mil animals and 36.6 bil liters milk • 10+ million farming families • Staple food of 175+ million people • 11% contribution to GDP • Milk Rs 341 bil • Wheat Rs 150 bil • Cotton Rs 100 bil • Rice Rs 71 bil

  3. Milk Production Flow Billion Liters % 36.6 18.9 13.3 1.2 useless 6.7 Bio Sweets 3.2 Bio Powder 0.415 Yogurt 2.4 Bio Farmer Retention 11 Bio Chilled 0.045 Unprocessed 12.1 Bio Liquid Milk 13.3 Bio Tradable Milk 18.9 Bio Ambient 0.716 Processed 1.2

  4. Key Dairy Challenges • Quantity • Supply-demand deficit of 4 bil liters by 2015 • Quality • High TPC reducing shelf life • Adulteration • Cost • Drastic increase in farm gate prices (+15% from 2006) • Shrinking processor margins

  5. Milk Quality Implications • Major hurdle for export opportunity and value addition • Average TPC in Pak 3+ mil/ml vs 50k in Middle East • Shelf life 3 month vs 6 month in Middle East • Adulteration

  6. What Needs to be Done • Prioritize milk shed areas for investment • Incentives on chillers infrastructure investment • Minimum pasteurization law • Incentives for corporate dairy farming • Improved breeding and farming practices • Better fodder management • Regulatory framework to encourage quality

  7. Milk Global Opportunity • In a growing world, milk is the new oil • Increasing demand-supply gap leading to high prices and diminishing dairy stock piles • Rising incomes – China, India, Middle East • Asia has replaced Europe as largest consumption zone • Reducing subsidies and tariff controls • Value addition

  8. Rice Opportunity & Challenges • Pakistani rice possesses superior cooking characteristics • Exports of 1 million tons of Basmati rice annually – predominantly Super Basmati • Despite superior quality, it sells at discount • Key challenges are: • Low quality parameters enforcement for export • Capacity building of regulators • Adequate technology • Reliance on single variety • Expedite R&D for new high yield varieties (farm & milling) • Inadequate paddy drying infrastructure (aflatoxin) • Farmer education on harvest time to control moisture • Incentives to encourage drying units • Engro procuring paddy directly from farmers, extensive agri services provided, launch seed distribution in 2012

  9. Meat Opportunity & Challenges • Recent acquisition of a Halal meat company in North America (Al-Safa) • Understand market and develop alliances • Currently meat can not be exported from Pakistan to North America (quality & certification) • Expand business into grains and fruits • Focus on Middle & Far East and Central Asia

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