What private-sector partnerships and investments (processing units, retail tie-ups, PLI for millet products) are being formed in UP — and what business models are proving sustainable?
Hey Himanshu Tiwari - I hope the below answers your question.
The resurgence of millets (Shree Anna) in Uttar Pradesh is not just a government-led initiative; it's being significantly powered by a growing wave of private-sector partnerships and investments. Recognizing the immense consumer shift towards healthier foods and the government's strong push, businesses are actively entering the millet value chain. Here’s a breakdown of the key developments:
1. Backward Integration: Setting Up Processing Units
A major challenge with millets is their post-harvest processing (dehusking, cleaning, sorting, grading). Private companies are investing heavily to solve this, creating the essential infrastructure needed to bring millet products to the market.
Large Agro-Processing Companies: Major Indian FMCG and agro-processing players are setting up or dedicating lines within their existing UP facilities for millet processing. This includes installing modern machinery like optical sorters and dehullers to ensure a consistent, high-quality supply of millet grains and flour for both their own brands and B2B sales.
Start-ups and SMEs: A new wave of agri-startups and smaller enterprises is emerging. They are establishing dedicated millet processing units, often closer to production clusters in regions like Bundelkhand and Mirzapur. These units focus on creating value-added products directly from the farm gate, improving farmer realizations.
2. Market Access: Retail Tie-ups and Branding
Getting millet-based products onto shelves is crucial. This is happening through strategic partnerships across the retail spectrum.
Modern Retail & E-commerce: Large supermarket chains like Reliance Fresh, Big Bazaar, and D-Mart are increasingly dedicating shelf space to millet products. They are partnering with brands that offer millet-based snacks, flours (like jowar, bajra, ragi atta), ready-to-cook mixes (millet dosa, idli mix), and even millet grains.
Direct-to-Consumer (D2C) Brands: Numerous D2C brands have emerged, selling directly through their own websites and online marketplaces like Amazon and Flipkart. These brands often focus on premium, organic, or innovative millet products like millet cookies, noodles, breakfast cereals, and protein bars, effectively creating a new market niche.
Food Service Industry: Restaurants, cafes, and hotel chains are partnering with suppliers to introduce millet items on their menus. This includes everything from millet khichdi and rotis to millet-based biryanis and desserts, making it trendy and accessible to urban consumers.
3. The Catalyst: PLI Scheme for Millet Products
The Government of India's Production Linked Incentive (PLI) Scheme for the Food Processing Industry has been a massive catalyst. While not exclusive to UP, numerous companies based in or supplying from UP are availing its benefits for millet products.
The scheme provides financial incentives for:
Sales and Branding: Companies get an incentive on their incremental sales of ready-to-cook/ready-to-eat millet products, including those made from nutri-cereals. This makes investment in branding and marketing these products more viable.
Capacity Expansion: It encourages manufacturers to set up new plants or expand existing capacity for producing millet-based goods, as the incentive is directly linked to achieving higher production and sales targets.
This PLI scheme effectively de-risks the initial investment for private players, making the millet business proposition far more attractive.
4. Beyond Processing: Holistic Partnerships
The partnerships extend beyond just making and selling products:
Farmer Producer Organizations (FPOs): Private companies are entering into off-take agreements with FPOs promoted by the government. This ensures a consistent supply of raw material for the company and a guaranteed market for farmers, creating a sustainable ecosystem.
Input and Technology Companies: Partnerships are forming with companies that provide high-yielding millet seeds, organic fertilizers, and farm-level technology to improve the quality and yield of the raw produce right from the beginning.
In summary, the private sector in UP is building a comprehensive ecosystem for millets. From building processing units to forging retail alliances and leveraging government schemes like the PLI, businesses are betting big on Shree Anna. This synergy between government vision and private enterprise is crucial for making Uttar Pradesh a major hub for millet production, processing, and consumption.
As of October 2023, Uttar Pradesh (UP) has been actively promoting private-sector partnerships and investments across various sectors, including millet processing, retail, and manufacturing. Some notable developments include:
Millet Processing Units and PLI Scheme: The Government of India has launched the Pulses and Millet Processing Units Production-Linked Incentive (PLI) Scheme, aimed at boosting millet processing capacities. Several private companies and cooperatives in UP have been encouraged to set up millet processing units under this scheme. These units focus on value addition, packaging, and branding of millet products to promote health foods and traditional grains. Specific investments include proposals from companies interested in establishing large-scale millet flour, snack, and health food manufacturing units in UP's agro-industrial zones.
Retail Tie-ups and Market Access: Major retail chains such as Reliance Retail, Big Bazaar, and Aadhaar Retail are increasingly collaborating with millet producers and processors in UP to stock millet-based products. Initiatives include dedicated millet aisles and branded product lines to promote millet consumption among consumers.
Processing Units and Food Parks: UP has seen investments in food processing parks, some of which are dedicated to millet and other regional crops. Private players and cooperatives are partnering with government agencies to set up units that process millet into various products, creating employment and value chains.
Public-Private Partnerships (PPPs): The state government has been facilitating PPP models to develop millet value chains, including infrastructure, storage, and marketing. Some projects involve collaborations with startups and established food companies to innovate and expand millet product markets.
Specific Investment Announcements: While detailed, company-specific investments are often announced during state investment summits or agro-industrial expos, some notable mentions include Amul and other dairy cooperatives exploring millet-based nutritional products. Private agro-processing firms are planning multi-crore units in UP’s agro-industrial corridors.
Summary: UP is witnessing a growing trend of private-sector engagement in millet processing and marketing, driven by government incentives like the PLI scheme, retail partnerships, and infrastructure development. These collaborations aim to promote millet as a healthy, regional crop, boost rural livelihoods, and create a robust value chain.