India: Open for businessExport & Market Access
While all eyes have been on China for signs of progress in the negotiations to permit Australian apples access, another mega-country is already open and looking to do business.
Like China, India’s economy is growing fast and by 2050, it is set to become the largest consumer economy by purchasing power parity (PPP) with an estimated population of 1.63b. Unlike China, the average age in India is significantly lower with a staggering 50 per cent of the population below 24. And it is this young, professional consumer market that Australian growers might really have something to get excited about, with 70 per cent of young Indians believing imported fruits taste better, are of higher quality and wider variety.
Also unlike China, India has already granted access to both Australian apples and pears, although high tariffs on Australian produce makes exporting impractical and not always commercially viable: a 50 per cent tariff is applied for imports, which is still considerably less than the eye-watering 70 per cent for US-sourced produce.
Despite the high tariffs India places on imported fresh produce, Australian growers are starting to receive direct inquiries as other southern hemisphere countries run low on fruit to export.
“The 50 per cent tariff is undoubtedly high, but remember that it’s high for everyone,” explains Justin, “And Australia is a lot better off than the USA, for example.”
APAL joins trade delegation
Justin was among a horticultural delegation organised by Hort Innovation and AusTrade, travelling to India in July to get a better understanding of the growing demand for high quality imported fruit into the country.
The six-day trip included meetings in New Delhi, Mumbai, and Chennai, three of the largest and wealthiest cities in India. AusTrade coordinated meetings with key importers, wholesalers, and key retailers in each city. In addition to APAL, delegates included: CEO of Table Grapes Australia Jeff Scott, CEO of Avocados Australia John Tyas, CEO of Citrus Australia Nathan Hancock, two export delegates from Summerfruit, and Hort Innovation Trade Manager Jenny Van de Meeberg.
The trip was enormously valuable, both in terms of experiencing wet markets and deepening relationships with key importers” “The way in which AusTrade managed the six-day visit was fantastic. AusTrade and Hort Innovation organised meetings with the biggest players in each city,” said Justin.
Appetite for ‘what’s new’ from overseas
Even to a visitor, India’s rapid pace of change is obvious: “In the space of just a few hours, we went from some of the most impressive cold store facilities and importers’ offices I’ve seen anywhere in the world, to local wholesale markets that would make Australian growers and retails baulk.”
Local stores continue to dominate the market – up to 85 per cent of Indians still buying their fruit and vegetables from small, local stalls where quality control is impossible. The remaining 15 per cent of consumers, however, are looking to shop in larger format, modern supermarkets. Retailers like Foodhall and Nature’s Basket are meeting the market by rolling out premium stores for wealthy Indians to purchase ‘what’s new’ from overseas.
Although the number of premium retail outlets is still limited, and Justin advises against working with importers and wholesalers who operate out of wet markets due to inconsistent cold chain provisions, Australian growers don’t need to be everywhere to be successful: “Just focussing on Mubai and New Delhi would give Australian apple and pear exporters access to a market nearing 60m people.
On demand, Justin says: “There is growing desire for premium quality apples in India, especially counter-seasonal apples, which Australia is in a unique position to supply,”
Australia can fill a unique window
“At this time of year, Indian consumers can really only purchase apples from Washington State that are close to 12-months old, and coupled with the recent increase to a 70 per cent tariff for US fruit, Australia can fill that window better than most.” said Justin.
Growers interested in exporting to India should contact Justin Smith, Industry Services and Export Manager via firstname.lastname@example.org or (03) 9329 3511