PRODUCT DIVERSIFICATION AND MARKETING IN INDIA

Paramjit Singh*

Abstract

This paper highlights the various efforts taken towards product diversification in the country due to uncertain income from traditional coconut products. The paper stated that the decline in prices of coconut and increased availability of cheaper substitute oil, both in edible and non-edible segments has reduced income of farmers. It is explained that incidence of eriophyid mite of coconut and drought condition suppressed the productivity and further eroded farm income. In the situation of falling prices during 2000 and 2001, Govt, agencies extensively resorted to procurement of without tangible impact on prices. This situation necessitated shift in strategy by giving emphasis on product diversification and by­ product utilization to reduce dependence on for utilization of coconut Aggressive generic market promotion of coconut products was undertaken by Coconut Development Board through print and electronic media. The strategic marketing approach was adopted by the Board by segmenting potential market in non-traditional non-producing areas, targeting the identified market through a series of coconut festivals organized in important cities and by highlighting health, nutritional and medicinal properties. Intensive farming systems are promoted with emphasis on recycling coconut organic waste, organic manuring, vermin- compost and integrated pest and disease management with least use of chemicals. All these strategies have had positive impact as reflected in the current scenario with a number of new coconut products available in the market and increased utilization of coconut for uses other than oil milling. The domestic prices of coconut oil and copra has also witnessed a sharp turn around beginning 2002 and sustained the rising trend all throughout the year.

1. Introduction

Coconut, an unique gift of nature to the mankind, interwoven with cultural heritage, provides livelihood support to over 10 million people in India through on-farm and off-farm employment and income generation. It being a versatile crop pervades religious, social and cultural life of people of India. Coconut provides health food, nutritional drink and also raw material for a number of processing industries. In India, coconut is cultivated in the island ecosystem mainly alongside the East and West Coasts in the states of , Karnataka. Andhra Pradesh, Tamil Nadu. Orissa. West Bengal. Goa and the Islands of Lakshadweep and Andaman & Nicobars. India produces 12,822 million nuts annually from an area of 1.89 million hectares with productivity level of 6776 nuts per ha. The contribution of coconut to the GDP of the country is over Rs. 70,000 million annually which is 2% of the contribution of agriculture and allied sector. Coconut contributes 6% to the vegetable oil pool of India. It is a source of empowerment to women. There has been substantial improvement in production and productivity of in the past as a result of research and developmental efforts and adoption of viable technologies by the farmers.

* Deputy Commissioner (Horticulture). Deportment & Cooperation. Ministry o f Agriculture. Government o f India The liberalization and globalization of Indian economy, however, have put pressure on the coconut industry to become competitive. Even though, only 39% of the coconuts produced in the country are used for production of copra and coconut oil, the prices of coconut are largely influenced by domestic and international price behaviour of these products. The decline in prices mainly due to increased availability of cheaper substitute oils have reduced income of the coconut farmers. The incidence of coconut mite and drought conditions have suppressed the productivity and further eroded farm income. The stress situations also aggravates the problem of root wilt disease in Kerala which is caused by phytoplasma which is non-lethal and slow debilitating. The strategies adopted for management of eriophyid mite of coconut has succeeded in the control of mite in the States where it was noticed first. In fact, the incidence of the pest has been reduced. The promotion of intensified farming systems in coconut gardens with compatible crops suitable for the region and with ready market helped to enhance the income from unit area. New coconut products in attractive consumer packs and ready to use convenient coconut foods have been developed. concentrate, , coconut shreddings and coconut shell products, especially activated carbon are now in the export market. The targeted marketing of coconut products, especially in areas other than producing areas with emphasis on health aspects has resulted in increased demand for these products especially packed tender coconut water. The increased use of coconuts for making products other than coconut oil has reduced dependence of coconut economy on coconut oil and improved sustainability of coconut cultivation.

In order to make coconut farming profitable, viable and sustainable, measures such as. integration of coconut cultivations with profitable enterprises, farm level processing, production of organically cultivated coconut, product diversifications and value addition along with projection of coconut as a health food and coconut water as nutritious drink, were adopted with positive impact reflected in current coconut scenario. This paper discusses status of Indian Coconut industry with special reference to product diversification and marketing of coconut products and future strategies.

Table 1. Estimates of area, production and productivity of Coconut in India

2001- 2002 Area Production States/Union Territories Productivity Percent '000 Percent Million (Nuts/ha) Hectares | Share nuts Share 1 2 3 4 5 6

Andhra Pradesh 1 0 4 .0 5 .5 0 1129.1 8.8 1 10857 A ssa m 2 1 .1 1.12 1 6 3 .6 1.2 8 79 5 4 G oa 2 5 .0 1.3 2 125.1 0 .9 8 5 0 0 4 K a rn a ta k a 3 7 3 .7 19.75 1 5 2 3 .4 1 1 .8 8 4 0 7 6 K e ra la 9 3 9 .5 4 9 .6 5 5 7 4 4 .0 4 4 .8 0 6 1 1 4 Maharashtra 16 .8 0 .8 9 1 9 3 .8 1.51 11 536 O ris s a 17 .3 0.9 1 142.4 1.1 I 8231 T a m il N a d u 3 3 5 .8 17.75 3 2 9 3 .6 2 5 .6 9 9 8 0 8

T r ip u r a 3 .3 0 .1 7 7 .0 0 .0 5 2121

West Bengal 2 5 .6 1.3 5 3 3 1 .6 2 .5 9 12953

A & N Islands 2 5 .2 1.33 8 9 .7 0 .7 0 3 5 6 0

Lakshadweep 2 .7 0 .1 4 53 .1 0 .4 1 19667

Pondicherry 2 .3 0 .1 2 2 5 .3 0 .2 0 11 000 All India 1892.3 1 100.00 12821.7 100.00 6776 Source: Directorate of Economics & Statistics, Ministry of Agriculture, Govt, o f India.

9 2. Area, Production and Productivity

In India, coconut is mainly cultivated in the coastal eco-system in the states of Kerala, Karnataka, Andhra Pradesh, Tamil Nadu, Orissa and West Bengal. The production of coconuts in the country is 12822 million nuts from an area of 1.89 million ha. with productivity of 6776 nuts/ha. (Table. 1). Kerala, Karnataka, Andhra Pradesh, Tamil Nadu accounts for 92.6 percent of the total area under coconut cultivation and 91.2 percent of total production. Kerala is the single largest coconut producing state with 49.6 percent share in area and 44.8 percent production. The crop has also been introduced in non-traditional but favourable locations in Central, North and North-Eastern regions in the country.

Fig. 1. Share of major coconut growing states in area and production of coconut (2001-2002) in India

The area under coconut was 1.08 million hectare in 1980 which increased to 1.89 million hectares by the year 2001-2002. Similarly, the production has increased from 5942 million nuts to 12822 million nuts over the same period. The increase in area, production and productivity during the decade 1981-91 was comparatively higher than that of the decade 1990-2000. Coconut Development Board on its inception in 1981 gave emphasis on improving production and productivity and creation of strong production base by planting with high yielding varieties and hybrids which was reflected during the decade. In the later decade the emphasis shifted to developing technologies for product diversification and by­ product utilization where India was lagging behind.

3. Demand Projections

There has been a slow growth in demand for coconuts and its products over the past few years. It was because of ill-founded campaign against the edible uses of coconut oil on health grounds and substitution by cheaper oils in traditional end-use sectors. The concerted efforts made by Coconut Development Board highlighting the health benefits of coconut oil, coconut kernel and tender coconut, the demand for coconut and its products is expected to expand in the coming years. The national and international efforts projecting intrinsic qualities of coconut oil have helped to restore the original position of coconut oil both in edible and non-edible sectors. The efforts to increase productivity have reduced cost of production and intercropping have increased income to the farmers per unit area. Efforts are on to widen the demand of Indian coconuts in domestic as well as export markets.

10' Coconuts and coconut products especially copra are used in all social and religious functions and also culinary purposes throughout the country irrespective of its major production being mainly confined to coastal belts. Copra is mainly processed for coconut oil. In northern India, people use it for edible purpose in sweet dishes as dry fruit and while in Western Coast, it is the inseparable part of their daily food in different forms.

Coconut oil is used for edible, toiletry and industrial purposes. The demand for coconut oil for edible and industrial uses is influenced by price whereas the demand for toiletry is price inelastic. The demand for coconut oil as dietary fat is confined mainly to Kerala and border districts of Karnataka and Tamil Nadu. This demand for edible oil as cooking medium is influenced by availability of low priced oil like imported palm oil. The demand for Indian medicated massage oil and bathing oil, especially "Kerala oil" is on the increase and sold at premium price world over.

Desiccated coconut is widely used in confectionery and bakery products. The market demand for packed tender coconut water, concentrated coconut water and coconut water based vinegar as natural health friendly products is increasing. Coconut oil cake has market throughout the country as cattle feed.

Shell powder has domestic demand for use in mosquito oils/mats. Coconut shell lends itself as a medium for expression of finer instincts of craftsmen. Shell craft art with exquisite carvings, finishing and paintings are sought after by collectors of curios. Coconut shell utensils are also becoming popular. The exquisite grains of , together with extremely durable characteristics make it an ideal timber for furniture, doors, windows and wall panels. Coconut shell charcoal is used as a fuel and for the manufacture of activated carbon. Charcoal is used by goldsmiths for melting gold and silver. pith a wasteful by-product in the coir defibering process is used as a soil conditioner, surface mulch and rooting medium. It is also used for making fuel briquettes. Coir pith has the potential to replace peat as nursery manure for growing potted horticulture plants. Coir, geo-textiles are gaining wider acceptability in soil erosion control.

In recent times, coconut shell has captured attention of elite in the western and European countries which are bio-degradable packing material. India is exporting shell products to Spain, Italy, France and other European countries. Export enquiries are being received from USA, Netherlands and Austria.

4. Consumption Pattern

Coconut is widely used in India for culinary uses and religious purposes besides processing into products like milling copra, edible copra, coconut oil, desiccated coconut, etc. While 55-61 per cent of the production is used for culinary and drinking purpose in raw form, only 35-39 per cent is used for the manufacture of commercial products. Of this, roughly 30 per cent is used for manufacturing milling copra to extract oil. The remaining is used for making edible copra and convenience food products. Of the coconut oil produced in the country, 40 per cent is used for edible purposes, 46 per cent for toiletry purposes mainly as hair oil and the remaining for industrial purposes. About 11 per cent of the coconuts are utilized as tender nut for drinking purpose in the country. Of the coconut husk available in the country, only 25 per cent is used for manufacturing coir and coir products and the remaining is mainly used as fuel. Coconut shell is mainly used as a domestic and industrial fuel and only a small quantity is used for making charcoal, shell powder and handicrafts. The water from matured nut is generally wasted and only insignificant quantity is used for making commercial products such as beverage, vinegar, etc. One cooperative society in Kerala is using coconut water for the production of bio-gas. Coconut oil cake is traditionally used as cattle

11 feed. Nowadays it is mainly used as raw material for extracting the remaining oil by solvent extraction process. The residue cake is used as cattle feed either as such or as mixed cattle feed incorporated with other ingredients.

Fig. 2. Consumption Pattern of Coconut in India

T rDomestic . (95%).;.":

a) Desiccated coconut a) Edible (40%) b) Cream b) Toiletry (46%) c) Milk powder c) Industrial (14%)

5. Export of Coconut and Its Products

The Indian coconuts and products are valued higher than international prices and are. therefore, uncompetitive in the international market. India’s export earnings are mainly from coir and coir products. Which amounted to Rs. 3451 million during 2002-2003. Export of other products valued Rs. 302 million. The coir product exported from India include coir fibre, coir yarn, coir rope, curled coir, handloom mattings, coir door mats, geo-textiles, rubberized coir, coir pith etc. Coir pith is in large demand for soil conditioning and mulching and as medium for growing horticultural crops. Geo-textiles are gaining wider acceptability in control of soil erosion. Among other coconut products, coconut oil and shell products are important. The product-wise export details are shown in Table 3.

Table 3. Export of Coconut Products from India (Value Rs. 100,000)

N o Ite m 1 9 9 5 -9 6 1 9 9 6 -9 7 1 9 9 7 -9 8 1 9 9 8 -9 9 1 9 9 9 -2 0 0 0 2 0 0 0 -0 1 2 0 0 1 -0 2 2 0 0 2 -0 3

1 C o c o n u t 1 5 .4 7 2 3 81 3 5 .9 6 5 7 5 5 7 6 76 1 6 9 .1 3 1 1 1 .1 9 2 4 6 .2 0

2 C o p ra 0 .0 4 6 4 2 9 0 .7 9 18 63 7 00 5 3 .4 1

3 Desiccated Coconut 2 9 .0 2 1 2 2 .6 4 6 9 .8 6 8 9 2 2 9 8 2 6 3 1 .2 8 56 1 4 4 .0 7

4 Coconut oil 3 9 2 .3 8 5 5 4 33 1 0 2 0 .5 8 6 4 9 .7 1 1 3 0 6 .4 7 1 6 3 0 .2 3 1 5 1 1 .3 1 1 3 9 8 .2 2

6 Oil Cake( Defatted) 0 .0 0 1 .4 9 3 .1 5 4 .2 0 1 .0 2 8 5 .5 4 0 .8 5 3 1 9 .7 7

7 Shell products 3 5 .8 6 7 3 .5 7 4 3 4 4 1 7 9 .0 1 4 4 4 .2 1 7 6 7 .6 0 8 5 0 .1 4 9 1 3 .5 7

8 Coir & Coir Products 2 0 6 8 4 .6 4 2 1 2 5 9 .0 0 2 3 8 9 3 .0 0 2 9 2 1 9 .0 0 3 0 3 0 5 .0 0 3 1 3 6 6 .2 5 3 2 0 5 8 .3 8 3 4 5 1 2 .7 5

T o ta l 2 1 1 5 7 .4 1 2 2 0 9 9 .1 3 2 5 0 6 6 .7 8 3 0 2 1 7 .3 3 3 2 2 3 8 72 3 4 1 0 8 .4 4 3 4 5 8 7 87 3 7 5 3 4 5 8

12 6. Price Trend

The prices of coconut have been fluctuating and have been largely influenced by international prices of copra and coconut oil. The prices of coconut in India is determined by the ruling prices of coconut oil in the market. The price difference in domestic and international market which was more than 300 percent in 1991 has narrowed down to around 40 to 50 percent in 2000-2001. The price trend of coconut oil in India is being influenced by the market arrivals, demand and also the price of substitute oils. Palm oil and Palm Kernel oil are two primary substitutes of domestic coconut oil. Palm oil compete in the edible oil segment and Palm Kernel oil is non-edible oil segments of the consumption base. Palm oil prices are globally cheaper than other major edible oils. The palm oil, therefore, not only dominates the Indian import scene, but also tends to transmit the price signals to the domestic edible oils/oilseeds prices. Quality-wise, the coconut oil produced in India is unique with its special aroma, flavour and purity and is preferred for edible and toiletry purposes. This pattern is expected to boost the indigenous consumption as well as export potential.

Figure. 3. Comparative Price Trend of Coconut Oil (Phil./Indo. CIF Rott.)

Figure-4. Comparative Price Trend of Copra (CIF Eur.)

13 In order to ensure reasonable prices to coconut farmers. Govt, of India ensures purchase of copra at pre determined prices under Price Support operation scheme. The procurement operations did not make an impact and the prices were ruling far below or far above the minimum support price fixed by the Govt, of India. As a matter of policy, it has, therefore, been decided to promote productivity improvement and also product diversification as a solution to the problem of fall in prices.

As compared to the years 2000 and 2001, the year 2002 and the period afterwards has been favourable to the coconut growers in the country as there was a recovery in price situation. The resumption of futures trading in Oct, 2001 in copra and coconut oil under the auspices of First Commodities Exchange of India Ltd. at Kochi market, extensive utilization of coconut in the form of tender nuts and thereby reduction in market arrival of copra, slight reduction in yield due to mite infestation etc. have contributed to upward trend in prices. The world prices staged a turn around and palm oil became substantially costlier during 2002 as compared to preceding two years. This resulted in reverse movement of demand towards coconut oil and the domestic prices witnessed sharp turn around beginning 2002 followed by sustained rising trends all through the year.

Since April 2001, the prices of coconut oil, in the domestic market has been on the increase. The prices which was Rs.3601/- qtl. in April, 2002 has increased to Rs.5363/-qtl in April, 2003 at Kochi market. Similarly, the prices of milling copra has also increased from Rs.2568/-qtl to Rs.3727/-qtl. in March. 2003. There has been an increase of 64 percent in the prices of coconut oil in the month of March, 2003 as compared to the prices at the same time during the year 2002. Similarly, the prices of milling copra has increased by 65 percent in March, 2003 as compared to the prices in March, 2002.

Table 4. Average Price Trend of Coconut Oil and Copra in Domestic and International Markets (Rs. per tonne) Coconut Oil Copra Year International International Domestic Domestic (Phil./Indo. CIF Rott.) (CIF Eur.) 1995 34600 24432 23160 14263 1996 44551 26643 29661 17325 1997 52571 23856 34831 15759 1998 44040 27219 29271 16958 1999 54451 31763 35060 19912 2000 34291 19939 23240 13707 2001 31020 13778 20660 9022 2002 43526 20296 28710 12904 2003* 55000 N.A. 37000 N.A.

* Average 5 months

7. Research Support for Coconut Industry

Research and development efforts in the past have yielded discernable rise in production, productivity, processing and value addition. The research in coconut is carried out at Central Plantation Crops Research Institute (CPCRI) and State Agriculture Universities. The policies and programmes for development of coconut in the country are formulated and implemented by Ministry of Agriculture, Government of India, through Coconut Development Board. Although production technologies have been developed by research institutes, these are seldom put into practices for various reasons. Research efforts

14 are now being concentrated on genetic improvement of coconut palms, pest and disease resistant studies and the development of post harvest sector. The emphasis of developmental organization is on the supply of quality planting material; transfer of technologies through demonstration and trainings; and integrated productivity improvement. The prospective entrepreneurs are also being facilitated and supported for adoption of viable technologies in the post harvest processing sector.

Central Plantation Crops Research Institute and its regional centres have done commendable work under the All India Coordinated Research Project and contributed substantially towards crop production and protection technologies. India was the first country to exploit the hybrid vigour of coconuts and evolved 13 hybrid and high-yielding cultivars. The country has largest germplasm collection comprising of 196 accessions of coconut (101 indigenous and 95 exotic). Viable production technologies have been evolved through multi-locational trials. Integrated pest and disease management and coconut based farming system models developed for utilizing the interspaces and sunlight available in the coconut gardens are globally accepted. Different eco-friendly integrated pest control methods have been evolved through research institutes. Bio control programmes have taken a long stride in the management of pests like rhinoceros beetle and leaf eating caterpillar and eriophyid mite of coconut. The strategies and programmes for management of coconut mite were appreciated by delegates from other countries in the International Workshop on coconut mite held at Bangalore in April, 2003. The Indian technologies were also adopted in Sri Lanka for management of mite. Hirsutella thompsonii was considered at the best candidate for lowering the population of mites at economic threshold level. It was also decided that a steering committee may be constituted at International level for management of coconut mite for coordinating research and development efforts in different countries, in the lines of Steering Committee functioning in India.

8. Development Support for Coconut Industry

For development of coconut at national level, Coconut Development Board is responsible. At the State level the Agriculture/Horticulture departments implement the programmes. The organizations like NAFED, KERAFED, MARKFED etc, functioning under Central and State Governments are involved in procurement, processing and marketing of coconuts. The central organizations like Coir Board. Defense Food Research Laboratory, Regional Research Laboratory, and Central Food Technological Research Institute and several private organizations are involved directly or indirectly in the development of technologies for processing of coconuts and contributed in the field.

The Coconut Development Board, at national level was established in 1981 under the administrative control of Ministry of Agriculture, Govt, of India for integrated development of coconut industry in the country encompassing production, protection, processing and marketing of coconuts and its products. The headquarters of the Board is located at Kochi, Kerala. Since, its inception, the emphasis of Boards programmes was on production and productivity improvement.

Programmes for increasing production and productivity implemented by the Board include production and supply of quality planting material of high yielding cultivars and hybrids, expansion of area under coconut, propagation of integrated farming and integrated pest and disease management; farmers participatory demonstrations and production of organic manure. The demonstration-cum-seed production farms set up by the Board in different agro climatic regions in the country serve as dependable source of quality planting material as well as demonstration centres for demonstration of technologies like farming

15 systems, recycling of organic waste, on-farm processing, etc. These programmes of the Board have created impact which is reflected in the increase of area, production and productivity of coconuts. Promotion of intensified farming system with emphasis on organic production has increased incomes of the farmers from unit area.

Technology Mission on Coconut was launched by Government of India in the year 2001-2002 to give focused attention in mission mode approach for technology development, demonstration and adoption in the field of integrated pest and disease management; product diversification; market research and promotion. Technology Mission on Coconut emphasizes on convergence and synergy among organizations and programmes for vertical and horizontal integration and to address problems and bridge gaps through appropriate programmes on mission mode. The objectives of the mission are to establish convergence and synergy of numerous ongoing governmental programmes in the field of coconut development in order to bring horizontal and vertical integration of these programmes; to ensure adequate, appropriate, timely and concurrent attention to all the missing links in the production, post harvest and consumption chain in order to maximize the economic and social benefits from existing investments and infrastructure created for coconut development; to promote economically desirable diversification and value addition to generate employment and dissemination of technologies, by using participatory approach through demonstration and market promotion. The technology mission support development, demonstration and adoption of technologies in the field of (i.) insect, disease and pest management; (ii.) processing and product diversification; (iii.) market research and promotion; besides technical support and external evaluation and emergent requirement. Financial assistance and other technical support is provided to government, private organizations, individuals, registered organization and cooperatives relating to research and development activities which cover the stated areas and the issues which has not been addressed and require immediate attention. The Coconut Development Board under the Technology Mission on Coconut has sanctioned 12 projects in the field of insect pest and disease management; 10 projects in the field of product diversification and 11 projects for market research and market promotion. The total cost of these sanctioned projects is Rs. 186 million.

9. Product Diversification

Traditionally, coconut industry in India has been confined to copra making, oil milling and coir & coir products. Desiccated coconut powder manufacturing is also a traditional coconut based industry in India. In the past, copra and coconut oil were also the most traded commercial coconut products. The prices of coconut is fixed based on ruling market prices of coconut oil. The liberalization and globalization policies adopted in the country allowed free import of cheaper substitute oils which resulted in decline in the prices of copra and coconut products to unprecedented levels. Even the investment of Rs. 5,000 million in the procurement operations in copra did not help to overcome the situation. This necessitated a shift in the strategy of coconut development by giving emphasis on product diversification and by-product utilization.

Technologies for several new products, viz., preservation and packing of coconut milk/cream in cans; preservation and packing of tender coconut water; spray drying of coconut milk; coconut vinegar; snow ball tender coconut; packaging of coconut chips etc. which are the first of their kind in the country have been developed and the Coconut Development Board is extending financial and other assistance to entrepreneurs for setting up coconut based industries. The Board has also developed infrastructure for pilot testing and

16 demonstration of technologies so as to convince the entrepreneurs about the viability of these processing technologies before commercialization. Processing of coconut into copra is a traditional labour oriented cottage industry mainly confined to southern region. Copra is available as milling and edible copra. Edible copra is of high quality and is made both in the form of ball and cup copra. Milling copra is generally in the form of cup copra and to some extent in the form of chips. There are about 12,000 copra making units in India and 8,000 in Kerala alone. Most of them resort to sun drying and some of them are using modern methods like hot air drying and waste heat recovery systems. The production of milling copra is between 6.65 million tonnes annually. For production quality copra Coconut Development Board has been popularizing improved copra drier for value addition at farm level. Coconut oil is extracted from milling copra by rotaries and oil expellers. There are about 1400 oil mills producing about 0.45 million tonnes of coconut oil. Oil cake the byproduct is diverted to solvent extraction for industrial purposes and the residue as animal feed. There are 3 units manufacturing coconut cream in Kerala, one spray dried milk powder manufacturing unit in Tamil Nadu and three units of packing tender coconut water, one each in Tamil Nadu, Kerala and Karnataka. The tender coconut water technology is the first of its kind in the world and the product is widely accepted by the health conscious people world over. Kerala based M/S Miracle Food Processors International (P) Ltd. has set up coconut water concentrate unit based on German technology. The product is receiving good response in the market. There are 22 units spread over the country manufacturing vinegar. Small scale processing sector is encouraged by the Board by imparting training to entrepreneurs and women groups on coconut based convenience foods. Women groups and societies have ventured into the production of convenience foods like coconut chips, coconut chutney, fried coconut gratings, coconut biscuits, coconut syrups, etc.

There are about 66 units manufacturing Desiccated Coconut mainly in Karnataka. Tamil Nadu and Andhra Pradesh. The total production of Desiccated coconut in India is around 40,000 tonnes annually. Bulk of DC produced in the country is used by confectionery industry. Coir industry in India is an important cottage industry of great economic significance especially for the rural sector. In the past, the coir industry was confined to production of white coir fibre. However, the brown coir fibre has also entered the market in a big way. The annual production of coir fibre in the country is estimated at 2.5 lakh tonnes, of which 1.25 lakh tonnes is white fibre and the remaining is brown fibre. Rubberized coir and geo­ textiles are other developments in the coir sector. Coir as geo-textiles, is a new end use application which have great export potential. Coir pith is a waste product obtained through the extraction of coir fibre from retted/partially retted or unretted husk. It consists upto 70% of the husk. Coir pith offers good scope for export as soil conditioner and organic manure.

Coconut shell, a natural product with high lignin content renders it to be very durable. Bulk of coconut shell in India is used as fuel .in households and small scale industries. In recent years, coconut shell has captured the attention of the elite in western and European countries who are going in for naturally available bio degradable packagings. With the efforts of the Coconut Development Board, four copra processing units in Kerala have been able to export about 1.2 million coconut shells in the form of cup, forks, spoons etc. to Spain, Italy, France and other European countries. Articles of very attractive appearances are also produced by expert craftsmen from coconut shell. Coconut shell is being commercially exploited for manufacture of coconut shell powder, coconut shell

17 charcoal and activated carbon. There are about five shell powder producing units located in Tamil Nadu, Karnataka and northern Kerala producing about 1,500 tonnes of the product on annual basis whereas the demand for coconut shell powder is estimated to be around 1,800 tonnes.

Thus the Indian coconut industry has made a strong footing in the field of coconut product development and by-product utilization. During the years to come the country may witness the emergence of more value added coconut products and more and more coconut based industries utilizing the modern technologies. Product diversification and coconut processing for value addition are important components of Technology Mission on Coconut.

10. Market Research and Market Promotion

In order to ensure reasonable prices to the farmers there is need to have a balance between demand and supply. The decline in prices of coconut and coconut products leads to erosion of income of the farmers. With the reduced income, the farmers refrain from using the required inputs resulting in reduction in productivity which further lead to income reduction. To reduce dependence on traditional coconut products like copra and coconut oil for use of coconuts, technologies have been developed and new products have come in the market but these are yet to catch attention of the consumers.

In India, with the population of 1040 million people, per capita consumption is much below the potential. Studies on assessment of market volumes indicate that there is ample scope for absorbing more than 20 billion nuts in different forms. Therefore, market research and market development are vital to enhance marketability of products to keep the balance between demand and supply and to ensure reasonable income to the farmers. Marketing has many aspects which needs to be taken care of viz., knowledge of consumer requirements, convincing the consumer about the product, ensuring required delivery system and creating a brand image for regular demand.

In a market research study sponsored by the Coconut Development Board revealed that tender coconut water is the most preferred coconut product among consumers. Large sections of the consumer surveyed were not aware of the uses of other products like coconut cream/milk, spray dried coconut powder, coconut chips, vinegar etc. The Board took initiative to popularize the uses of new coconut products in the form of recipes. Market research being one of the focus areas for identifying consumer needs and preferences for developing suitable products to satisfy the needs of the consumers.

Research studies on health aspects of coconut oil were undertaken through reputed institutions and hospitals, etc. The mis-concept of risk factor has been ruled out by the study results. These findings were corroborated by eminent doctors from India and abroad. A series of seminars and workshops were conducted by Coconut Development Board on health aspects of coconut oil as dietary fat. It was possible to dispel the misconception that coconut oil increases lipid cholesterol levels leading to coronary artery diseases in humans. The country's strategic agenda aims at improving the competitiveness of coconut industry by giving focused attention on popularizing the health aspects of coconut products.

The Coconut Development Board has adopted pro-active role for generic market promotion of new coconut products through print and electronic media as well as by participating in exhibitions and festivals. The Board organized a series of coconut festivals in important cities in non producing areas in northern and central parts of the country. Festivals have been organized in Jaipur (Rajasthan), Patna (Bihar) and Chandigarh (Haryana). At the Jaipur Coconut Festival, Nagarjuna Ayurvedic Group participated with "Massage Centre" which was an attraction of the festival, to promote the market of coconut oil as body oil.

18 The Patna festival resulted in business tie ups between manufacturers and distributors for marketing of coconut water concentrate and tender coconut water in pouches. The Bihar State Tourism Development Corporation has agreed to install coconut water concentrate vending machines at different locations in Patna. Entrepreneurs and manufacturers of coconut products were given opportunities in such fairs to exhibit their products as market promotional venture. The Coconut Development Board participated in International Food Fair, 2002 held at Sharjah with three manufacturers, one exporter and three officials. India's participation created lot of interest for Indian products in Sharjah and attracted trade enquiries from local businessmen. In India International Trade Fair in November, 2002 at Pragati Maidan. New Delhi the Board participated by putting up stalls and sale counters where packed tender coconut water, coconut water concentrate, vinegar were sold. Refreshment stalls in Pragati Maidan also sold packed tender coconut water and drinks made of coconut water concentrate. The Board also participated in International Food, Drink and Hospitality Exhibition, 2002 at Pragati Maidan, New Delhi by organizing Coconut Food Fair. The Board participated in World Ayurveda Expo and Herbal Trade Fair, 2002. During AAHAR in March, 2003 at Pragati Maidan, New Delhi the Board organized Coconut Food Fair. Delegations from countries like Tanzania, Mozambique, Sri Fanka and Mexico were very much impressed and evinced lot of interest in technologies and Indian coconut products, especially packed tender coconut water. Aggressive marketing strategies initiated by the Coconut Development Board in non producing States has enhanced the demand for coconut products in the country w'hich needs to be fully exploited. The demand for coconut products like shell and husk has also increased many fold. The export value of a single product i.e. activated shall carbon from a Kerala exceeded Rs.300 million which expected to go up to Rs.500 million in the coming years. The shell based industries is facing shortage of raw material for large scale manufacture of activated carbon to meet the increasing demand. The demand for packed tender coconut water has increased from 5000 packets per day in 2001 to 70,000 packets per day.

In view of the fast growing health conscious population world over, the eco- friendly, natural health food and bio-degradable aspects of coconut products provides enormous strength and potential to coconut industry to grow. Therefore, it needs to develop convenient coconut food products, keeping in view the consumer tastes and preferences to catch their imagination. Buyers prefer well presented attractively packed products and easily available at convenient places. People in high income brackets do not bother about prices. The new products in attractive consumer packs can easily move to the non traditional areas.

11. Popularization of health aspect of coconut

Interestingly, in big cities health-conscious population is growing very fast. To attract their attention for widening the consumer base, it is essential to highlight medicinal and therapeutic properties of coconut oil, consumer friendly coconut products and tender coconut water. The Laurie acid component of coconut oil is now considered as an ideal dietary fat due to its anti-microbial benefits. Human body utilizes lauric acid to make monolaurin which is reported to possess anti-viral, antibacterial and anti-protozoal properties. Studies have indicated its effectiveness in lowering the viral load of HIV, which means less AIDS patients. Many more such studies are required to be taken up to convince the consumer about its properties. Tender coconut water, a wonderful natural health drink, rich in minerals and vitamins, has many medicinal properties. Through the development of appropriate

19 technologies for packaging of tender nut water, its availability has been enhanced even in region where coconut is not produced. Since the health conscious population is looking for natural health drinks, there is ample scope for popularizing this product as health drink, sport drink etc. The demand for packed tender coconut water which was only 5,000 packets in 2001 has now increased to 70,000 packets per day. The demand for natural products is growing very fast especially for export. Coconut Development Board is, therefore, promoting organic cultivation of coconuts and coconut products. Board is also accredited agency for certifying organic coconut product.

12. Future Strategies

Efforts shall be continued for increasing productivity of existing coconut gardens through promotion of recycling of organic waste, organic manuring, vermicompost and integrated pest and disease management with least use of chemicals. In coconut gardens intensified farming systems with organic production will be promoted to enhance income of the farmers from unit area. The choice of inter crop will depend on potential in the region and marketability of the products. Availability of quality planting material of high yielding cultivars and hybrids shall be enhanced for new planting and replanting to create genetically improved production base. For human resource development, training and visit of the farmers and extension workers shall be strengthened. For product diversification and by-product utilization, affordable and viable technologies shall be developed for new coconut products keeping in view the needs of the consumers for adoption at farm level by the cooperatives, especially Women's Self Help Groups. Entrepreneurs shall be provided financial and technical support for starting coconut based industries. Quality standards shall be developed and enforced for Quality Assurance. Technologies shall also be developed for innovative and attractive packaging for value addition and to improve commercial viability of new coconut products.

Convenient coconut food and coconut water based natural products, packed in attractive consumer packs shall be promoted as natural and healthy products. These products blended with suitable flavour will go a long way to satisfy the taste buds of people in non- traditional areas.

APCC can take up generic market promotion of coconut based products and by­ products with emphasis on health aspects of coconut products to exploit the grow-ing demand for naturally produced, environment friendly, bio-degradable and non-polluting products. APCC may emphasize on market research to explore new markets for coconut products.

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