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1 FOR PRIVATE CIRCULATION ONLY A BI-MONTHLY PUBLICATION AGRI EXPORT-IMPORT BANK OF INDIA Visit us at JANUARY 2014 VOL. XVIIi ISSUE I Publisher in English, Hindi, Marathi, Assamese, Bengali, Gujarati, Kannada, Malayalam, Oriya, Pubjabi, Tamil and Telugu 9th WTO Ministerial Meeting - Implications on Food & Agriculture WTO s 9 th ministerial conference held in Bali during 3-7 December, 2013 agreed on a package to streamline trade, allowing developing countries with more options to achieve food security, particularly to boost least developed countries trade. Ministers adopted a set of decisions called the Bali Package. The Bali Package is a set of issues from the broader Doha Round negotiations. Agriculture has been the central topic at the WTO negotiations. WTO members have agreed to reform the present Agreement on Agriculture (AoA), which is a result of the Uruguay Round. This sector has greatly contributed to the current impasse. It is often viewed as being distorted by subsidies and high trade barriers that affect the access to food, fibers for clothing and other materials, and the livelihoods of farmers around the world. Furthermore, the global economic slowdown, increasing climatic shocks and high food prices which threaten food security around the world have highlighted the urgent need for a multilateral solution. Three elements out of the broad agricultural dossier were discussed in the Bali Package: Export subsidies Tariff Rate Quota (TRQ) administration Public stockholding for food security purposes Agreement on the agriculture part of the Bali Package required seeking concurrence on two main issues. Much of the focus was on shielding public stockholding programmes for food security in developing countries, so that they would not be challenged legally even if a country s agreed limits for trade-distorting domestic support were breached. The outcome of consultations was for the interim solution to exist until a permanent one is agreed, with a work programme set up aiming to produce a permanent solution in four years. The other issue was about tariff quota administration, how a specific type of import quota is to be handled when the quota is persistently underfilled. Members have agreed on a combination of consultation and providing information when quotas are underfilled. The one remaining issue to be settled was which countries would reserve the right not to apply the system after six years: they will be Barbados, Dominican Republic, El Salvador, Guatemala and the US. It has also been proposed that members ensure: that progress will be made in eliminating all forms of export subsidies, that actual subsidies will be well below the permitted levels, and that disciplines will apply to export policies that may have the same effect as subsidies. Even though the proposal embraces strong statements of intent, it does not go as far as to include any legal commitment. Process of adoption The deal on the Bali Package was struck after intensive consultations among the Ministers during the Conference. In conclusion, almost all members agreed that the package should be adopted in full, even if they were not in agreement with some parts of it. However, according to them, the Package was needed because of the benefits it would give directly, but also because it would reinvigorate the WTO and its trading system, and provides the momentum to conclude the Doha Round, which was launched in 2001, and has seen little progress since 2008, until work intensified on the Bali Package during Reference WTO C O N T E N T S 9th WTO Ministerial Meeting - Implications on Food & Agriculture 01 Meat Outlook 2-3 Processed Fruits and Vegetables Market in the EU 4-5 Spices Industry in India 6-7 Tomatoes Export Potential from India 8-9 IPR in Agriculture Overview News Focus 12

2 Meat Outlook Production The world meat production is expected to increase at a moderate rate in 2013 and reach million tonnes, an increase of 1.4% over the production level of Much of this growth will be concentrated in the developing countries. The trade in meat is anticipated to reach 30.1 million tonnes in 2013, which constitutes around 10% of the global production. The global trade in meat is predicted to increase by 1.1%, which is at a slower pace in comparison to the growth witnessed in This phenomenon can be attributed to improved national supplies in the importing countries and a fall in the production of the major exporting countries. Among the different varieties of meat, there is moderate growth forecast for bovine meat, a substantial increase for ovine meat, the trade in poultry might remain the same, while the trade in pig meat is expected to decline. Bovine meat production is forecast to reach 67.5 million tonnes in 2013, which is an increase of 0.2% over the production in In South America, cattle availabilities have been rising particularly in Argentina, Brazil, Paraguay and Uruguay. In India which is the fifth largest bovine meat producer, half of the production is exported, and an additional growth in the production level is expected in The government slaughter subsidies provided in the Republic of Korea would lead to a rise in output. The production in China would remain around 6.5 million tonnes, a level which has been unchanged for the past four years due to the labour shortages and high costs. Ample rainfall in Africa has led to improved pasture conditions and would cause a rise in bovine meat production. The bovine meat production in South Africa is expected to be at the same level. Asia is the leading pig meat producing region and accounts for almost 60% of the total. Due to strong consumer demand and government support policies, China s output might reach half of the world s output to a level of 54.8 million tonnes. Among other parts of Asia, moderate growth is anticipated in Vietnam, Philippines, Japan, Thailand and Indonesia. Brazil, the fourth largest producer is forecast to increase output stimulated by a rise in prices and growth is also anticipated in Mexico. EU, the second most important producer of pigmeat after China, is expected to witness a depression in output. Lower feed cost as well as increased slaughter will stimulate a rise in production of pigmeat in the United States. In the Russian Federation, reduced feed prices and government policies favouring large scale farms might lead to a 4% expansion in output. The global poultry production is forecast to rise by 1.8% over the production level of 2012, and the output is expected to rise to 107 million tonnes in Poultry production in China is anticipated to be unchanged from the 2012 levels; however, in USA a 2.4% increase is anticipated as production recovers from the stagnation in Growth in the production level is anticipated in The EU, Brazil and Russian Federation and a continued rapid expansion is anticipated for India. Japan might witness a fall in output of around 0.7% in bovine meat owing to oversupply and reduced prices. Ovine meat production is expected to show modest growth and rise by around 1.5%, to around 13.7 million tonnes. The large producers of ovine meat are China, India, Nigeria, Pakistan and Algeria. In Australia, the sheep meat production began growing in 2011, and has been rising since then; however, New Zealand is expected to register a reduction in the ovine meat production. Trade The world trade in bovine meat is expected to have grown in 2013, by 4.9%, to 8.4 million tonnes. In trade related to bovine meat, China may see a rise in the imports as demand is stimulated by rising income. Imports by Japan, Vietnam and Malaysia could increase moderately while imports by Republic of Korea are anticipated to remain depressed as a consequence of ample domestic supplies and price competition from other types of meat. Imports by the two major importers, Russian Federation and the United States are forecast to decrease as a result of high prices. Production decline as well as high internal prices might lead to a rise in the imports by EU. Growth in exports is forecast for Brazil and Australia, by 4% and 8% respectively, in response to the strong demand, which has also stimulated shipments by India and the United States. Uruguay, Paraguay, Argentina and Belarus are anticipated to have witnessed a rise in exports; however, this would not be the case for New Zealand. The shipments by Canada, Mexico and Nicaragua are forecasted to have decreased significantly, while those of EU would remain stable. Reduced output among principal exporting countries and decrease in demand by major importing countries are projected to lead to a decline in 2013 pig meat trade with shipments dropping to 7.4 million tonnes. Imports by Republic of Korea are forecast to register a decline due to low domestic prices caused by recovery in production. Japan, the largest importer is anticipated to have cut its purchases by 4% due to expanding production and competition from poultry and imported beef. Imports by China are expected to have increased by 6% as domestic production is unable to keep up 2

3 with the demand. In Ukraine, after imports have more than doubled in 2012, animal disease and public health restrictions introduced during the first part of the year have led to a sharp fall in purchases. Imports from Mexico and United States are anticipated to have decreased while some small scale importing nations, Australia and Angola could witness growth in exports. Limited availability in the EU, United States, Canada, and Brazil which account for 85% of world exports, poses a constraint on world trade. However, larger shipments are anticipated by small-scale exporting countries, including China, Chile, Mexico and Thailand. Poultry is the most traded category of meat, representing almost 45% of total trade. Imports for Africa are forecast to rise by 4%. The major importing countries, Angola, Benin, Ghana and Egypt, are all anticipated to purchase more due to income growth, while South Africa s imports are expected to remain unchanged. Among the principal importers in Asian countries, slight to moderate growth is expected in Saudi Arabia, Vietnam, Iraq, UAE and Kazakhstan. In Japan and Republic of Korea abundant domestic supplies are expected to reduce the demand for imports. The imports by Russian Federation are forecast to fall because of considerable increase in domestic production. In North America, Mexico is anticipated to decrease its imports, while that of Canada may rise slightly. The four leading exporters of poultry meat are Brazil, United States, EU and China. Among these, the United States is expected to witness no change in the quantity of exports, while the other three countries are expected to see a fall in their trade. Exports from Turkey might have increased by as much as 20% for 2013 due to growth in regional demand from Iraq and Syria. Exports of poultry by Ukraine and Argentina are also expected to have registered growth. Trade in ovine meat is expected to have grown by 16% and a rise in imports by China is expected. A growth in demand is anticipated in the EU, United States, UAE, Qatar and Malaysia. A rise in the exports by India to the Middle East, especially the UAE and Saudi Arabia, is also expected. Uruguay has also witnessed a growth in its exports mainly to China and Brazil. World Meat Market Change: Estim. f cast 2013 over 2012 million tonnes % World Balance Production Bovine meat Poultry meat Pigmeat Ovine meat Trade Bovine meat Poultry meat Pigmeat Ovine meat Supply and Demand Indicators Per capita food consumption: World(kg/yr) Developed(kg/yr) Developing(kg/yr) Reference: FAO Source: FAO 3

4 Processed Fruits and Vegetables Market in the EU Europe is a major player in the trade of processed fruits and vegetables. Germany, France, United Kingdom and the Netherlands are the principal importers of processed fruit and vegetables. The share of developing countries in the total volume of European imports in the year 2011 was around 35%. Processed fruit and vegetable production in Europe has remained stable in the previous years and a major part of the European production is exported to other European countries. Production The production of processed fruits and vegetables rose from 41.8 billion Euros in 2012 to 44.4 billion Euros in 2011.The total production of processed fruit and vegetables varies owing to factors such as the influence of climate or weather conditions and the market prices; however, these have remained stable in the recent years. The production between 2008 and 2011 remained in between 38 and 39 million tonnes, and not much of an increase is anticipated in the near future. Italy, Spain, Germany and the Netherlands produce around 50% of the European processed fruits and vegetables. Spain is a major producer of edible nuts, while Germany produces 21% of fruit juices, and the Netherlands produces 18% of frozen fruits and vegetables in Europe. The share of organic production in fruits and vegetables in Europe is relatively large; 3.9% for vegetables and 4.5% for permanent crops, mainly fruit trees and nut trees. Among the European countries, principal producers of organic fruits are Italy, Spain and Greece. In case of organic vegetables production, the major producers in Europe are Italy, Germany and France. Consumption EU fruit juice and juice drink consumption stood at 10.7 billion litres in Germany had the highest per capita consumption of about 38.9 litres per person and is the major juice producer among the EU and EFTA countries. In case of fruit juices there has been an increasing demand for quality rather than quantity. The total consumption of canned fruits and vegetables was 7.8 billion in The value of consumed vegetables was 5.5 billion and the value of consumed fruit in the EU was 2.3 billion in The market for frozen food in Europe is divided into Northwest European market and South European market. The Northwest market does not show any signs of development due to market saturation, while the South European market has been growing. In Europe fruits are generally fresh while the vegetables are prepared or processed. Most of the processed fruits and vegetables are not consumed but are used by food processing industries to make pizzas, cookies, biscuits and ice creams. The food processing industries maintain close relationships with the importers in order to get a regular supply of high quality food. Dried and frozen fruit, dried vegetables, edible nuts, fruit juice concentrates and provisionally preserved fruits and vegetables are used as ingredients for the food processing or manufacturing industry. Canned frozen fruits and vegetables and edible nuts are end products that are finished and packed at the origin. In the recent years, there has been an immense transformation in consumerism in the EU with changing lifestyles of people and increasing number of working women, thus accordingly innovation is required to provide processed fruits and vegetables in more convenient form. Health and well-being is being increasingly prevalent in the consumer priority list and this has been affecting the consumption of processed fruits and vegetables. Consumers are aware of the health benefits of fruits and vegetables. Even though the spending power of people might have decreased due to the economic crisis in Europe, consumers are willing to spend on healthy food. Fruits and vegetables are the most important category of sustainable food products that are purchased by consumers, with shares between 15% and 36% in total organic sales in the four largest EU markets. Exports The total of EU and EFTA exports of processed food and vegetables have risen from 17.7 billion Euros in 2007 to 20.7 billion Euros in In terms of quantity, this increase was comparatively lesser, as the exports rose from 16.2 million tonnes in 2007 to 17.6 million tonnes in The rise in prices or shift towards expensive products can be attributed to the difference in growth between export value and export quantity. The Netherlands, Belgium, Spain, Italy and Germany are the principal exporters of processed fruit and vegetables in Europe. The main destinations in Europe for processed fruits and vegetables exports are Germany and France, followed by United Kingdom. Exports of processed fruits and vegetables to other countries outside Europe were of the value of 3.2 billion Euros in 2011, with Euro 781 million going to developing countries. The leading export destinations outside Europe are United States, Russia, Japan and Australia. Major developing countries to which Europe exports fruits and vegetables are: Ukraine, Egypt, Turkey, India and Mexico. Fruit juices occupy the greatest share of exported processed fruits followed by jams, jellies and marmalades. In case of processed vegetables, 4

5 processed tomatoes and potatoes are the largest exported product groups. It is anticipated that in the near future, Europe will face increased competition from China and Turkey in terms of exports of processed fruits and vegetables. Imports The quantity of imported processed fruit and vegetables in EU/ EFTA remained almost the same in 2011 as compared to 2008; while the quantity imported in 2008 was around million tonnes, the imports in 2011 aggregated to million tonnes. In terms of value, there has been a rise in imports attributed by price rises or shift towards expensive product types. The value of imports in 2011 was worth 29 billion Euros. The imports by Germany constituted 21.5% of all EU/EFTA imports in 2011 and are the largest importer of processed fruits and vegetables in Europe. The other major importing countries are France (13%), the United Kingdom (12%) and The Netherlands (11%). The Netherlands is an important entry port and is a major European trading hub for products entering Europe. The principal exporting countries are Belgium, Germany and Spain. Major suppliers are Brazil, China, Turkey and USA. Imports from developing countries amounted to approximately 35% of total European imports in The value of imports has increased since 2009, and it is the price increases which are mainly responsible for the increase in export value. Thailand exports fruit juices and canned fruits and vegetables, Costa Rica exports pineapple juice, while India exports nuts, dried as well as canned fruits and vegetables to EU. EU27+EFTA intra- and extra EU imports of processed fruit and vegetables, , in million 20,000 18,000 16,000 14,000 12,000 10,000 8,000 6,000 4,000 Intra EU imports Extra EU imports Developing countries The processed fruits that are imported consist mainly of prepared or preserved fruit, orange juice and frozen fruit, while imported processed vegetables mainly consist of prepared or preserved tomatoes, mushrooms and asparagus. Total EU27+EFTA PFV imports from countries, 2011, in % of quantity Source: United Nations COMTRADE database, DESA/UNSD There are a number of food regulations in EU. The new EU Regulation 669/2009 established a list of products of nonanimal origin, imported from developing countries into the EU that have been identified as risky for consumer s health, and for which reinforced control procedures at the EU borders are required. Moreover consumers are increasingly apprehensive about the origin of the products, and how they were produced, and demand sustainable products from the retailers. There are several labels that relate to good agricultural practices including working conditions and production methods. EU buyers are also particular about food safety and hygiene. They prefer food that is processed according to HACCP s principles. Health claims are expected to become important, as efforts to combat major health problems such as obesity and related complications are major issues in Western countries. There is a trend towards COO (country-of-origin) labeling for reasons of transparency and food safety. This is not yet obligatory for many processed fruits and vegetables but it is better for the manufacturers to give origin information. 2, Reference CBI, The Netherlands Please note that this Figure shows the intra- and extra-eu imports. When combined, they show the total import volume. Imports from developing countries are part of extra-eu imports. Data source: United Nations COMTRADE database, DESA/UNSD. 5

6 Spices Industry in India Global Spice market is worth US$ 3.67 billion. Spices come under commodity markets which are high in value but low in volume. There are about 109 spices listed by International Organization for Standardization, and Asia grows about 60 of these spices. Key players in spices market are: in North America - U.S.A; in Asia - India, China, and Japan; and in Europe - UK, Germany, France, Spain, and Italy. International competition is tough among spice producing countries such as India, Vietnam, Guatemala and China. Amongst the global spice market, chilly contributes 40% market share, followed by cumin 11%, turmeric 11%, coriander 6% and black pepper 5%. Approximately 85% of the world trade on spices and herbs is conducted in crude and dried form. Global exports of spices during the year 2012 stood at US$ 7.3 billion. Peppers and chili pepper (HS Code 0904) are the largest exported spices globally followed by ginger, saffron, turmeric, thyme, bay leaves and curry (HS Code 0910), and nutmeg, mace and cardamoms (HS Code 0908). India is the major supplier of spices in all the categories. Pepper is the major spice traded globally. Vietnam is the leading exporter of spice in the world, followed by Indonesia, Brazil and India. HS Code Product label World Exports of Spices US$ billion 0904 Pepper, peppers and capsicum Ginger, saffron, turmeric, thyme, bay leaves & curry Nutmeg, mace and cardamoms Seeds of anise, badian, fennel, coriander, cumin, etc Cloves Cinnamon and cinnamontree flowers Vanilla Total Source: Trademap, ITC, Geneva Spices (estmt) (advnc estm) Trade Area Production Area Production Area Production (Ha) (tonnes) (Ha) (tonnes) (Ha) (tonnes) Pepper 183,780 48, ,381 43, ,381 55,000 Cardamom (small) Cardamom (large) Area and Production under Spices Cultivation in India 71,012 10,380 71,285 15,000 69,870 12,420 26,984 3,918 26,460 3,860 26,060 4,145 Chilli 716,428 1,299, ,610 1,426, ,584 1,299,919 Ginger 167, , , , , ,269 Turmeric 232,022 1,268, ,720 1,246, , ,098 Coriander 474, , , , , ,390 Source: Spices Board of India Key markets importing spices and condiments from India include the US, which is the major importer, followed by China, the UAE, Malaysia, Saudi Arabia, the UK, Germany, Singapore and Sri Lanka. Code Product label Pepper, peppers and capsicum Ginger, saffron, turmeric, thyme, bay leaves & curry Seeds of anise, badian, fennel, coriander, cumin, etc. Nutmeg, mace and cardamoms Cloves Vanilla Cinnamon and cinnamon-tree flowers Spices exports from India Total Source: Trademap, ITC Geneva Indian Spice Industry India is the world s largest producer and exporter of spices in the world. Of the 109 varieties listed by the International Organization for Standardization (ISO), the country produces and exports about 75 varieties of spices. Spices exports from India grew at a CAGR of 15.2 per cent during the period 2008 to India primarily exports pepper, chilli, turmeric, ginger, cardamom, coriander, cumin, fennel, fenugreek, celery, nutmeg and mace garlic, tamarind and vanilla. Processed spices such as spice oils and oleoresins, mint products, curry powder, spice powders, blends and seasonings are also exported. 6

7 Pepper is grown in India in the states of Karnataka, Kerala and Tamil Nadu. During the year the area under pepper production in India was thousand hectares while the production aggregated to 50 thousand tonnes. Kerala, the largest producer of pepper has around 86% share in the total area under cultivation of pepper. The small variety of cardamom is grown majorly in Karnataka, Kerala and Tamil Nadu. In terms of production in the share of the states of Kerala, Karnataka and Tamil Nadu in the Indian production of cardamom is 77%, 15% and 7% respectively. The larger variety of cardamom is grown in Sikkim and West Bengal. According to Spices Board of India, the production of chilli as per the provisional estimates in was thousand tonnes. Andhra Pradesh, Karnataka, West Bengal and Madhya Pradesh are the leading producers of chilli in India. Exports HS Code 0904: Pepper, peppers and Capsicum India s exports of pepper has been increasing as the value of exports have risen from US$ million in to US$ million in USA is the largest importer from India with a share of 18.42% in India s exports. Other major importers from India are Vietnam, Malaysia, Sri Lanka, Thailand and Pakistan. Top 5 export destinationsof pepper (US$ Million) Country USA Viet Nam Malaysia Thailand Sri Lanka World Source: DGCIS HS Code 0910: Ginger, saffron, turmeric, thyme, bay leaves & curry The world exports of ginger, saffron, turmeric, thyme and bay leaves have risen and the value of world exports in stood at US$ 316 million. The principal importers from India are USA (12%), UK(8%), UAE(7%), Saudi Arabia(5%), and Nepal(5%). Top 5 export destinations of Ginger, saffron, turmeric, thyme, bay leaves & curry (US$ Million) Country USA UK UAE Saudi Arabia Nepal World Source: DGCIS HS Code: 0909 Seeds of anise, badian, coriander and cumin India s exports of seeds of anise, badian, coriander and cumin were worth US$ million in UAE is the largest importer of this product from India and the value of imports stood at US$ 35.5 million in The other major importers are Malaysia, Vietnam, USA and Brazil. HS Code 0908: Nutmeg, mace and cardamom India s exports of nutmeg, mace and cardamom have risen drastically from US$ 55 million in to US$ 98.6 million in Saudi Arabia is the largest importer of nutmeg, mace and cardamom with a share of 35% in the India s exports. HS Code 0907: Cloves USA is the largest importer of cloves from India and the value of imports from India in stood at US$ 1.43 million. Other major importers are Singapore, Saudi Arabia Malaysia and Pakistan. India exported cloves worth US$ 3.57 Million in HS Code 0905: Vanilla India s exports of vanilla have decreased at a CAGR of 3.3% during the period to as the value of exports declined from US$ 5.28 million in to US$ 4.94 million in USA, Belgium, Netherlands, UK and Germany are the principal importers of vanilla from India. Hs Code 0906: Cinnamon and cinnamon tree flowers India s exports of cinnamon and cinnamon tree flowers have increased at a CAGR of 35.91% during the period to as the value of exports rose from US$ 1.44 million in to US$ 2.66 million in USA is the largest importer with a share of 20.3% in India s exports. The other major importers from India are UK, France, Poland and New Zealand. Outlook Growing demand for convenience foods and fascination for ethnic cuisine has fueled sales of food accompaniments, including spices and seasonings. Asia-Pacific region, driven by vibrant spice markets of India, China, Vietnam, Indonesia, Sri Lanka and others, is poised to take the growth forward, expanding at the strongest compounded annual growth rate (CAGR) of about 5.6% through Indian spices market has grown significantly over the last six years, having registered a CAGR of 10% in terms of value during the period 2007 to 2013, and is further, projected to register healthy growth. Revenues from the unorganized segment are expected to continue dominating the spices market in India. Reference: ITC, Geneva The Spices Board 7

8 Tomatoes Export Potential from India French botanist, Tournefort, provided the Latin botanical name, Lycopersicon esculentum, to the tomato. A member of the nightshade family, tomato is native to western South America and Central America. Abundantly rich in vitamins, minerals and organic acids, the tomato fruits nutritive value varies in different varieties and also depends upon the environment in which it is cultivated. Tomatoes form an integral part of cuisines across the globe especially in the Mediterranean region. The health benefits of tomatoes include improved eye sight, low blood pressure as well as relief from diabetes, skin problems and urinary tract infections. exporters of tomatoes are Netherlands, Spain, Morocco, Turkey, France, USA, Canada, and Italy. Top exporters of tomato Global Scenario The world production of tomatoes in 2011 stood at million tonnes and the production has grown at a CAGR of 1.5% during the period China is the largest producer of tomatoes in the world and constitutes about 30% share in the aggregate production. India is the second largest producer of tomatoes, followed by USA and Turkey. According to FAO statistics, India has displayed the highest growth rate in tomato production during the period 2009 to 2011, and the production rose at a CAGR of 22.9%. The other major tomato producing countries are Egypt, Iran, Italy, Brazil, Spain and Uzbekistan. Major tomato producing countries in the world (2011) Source: Trademap USA is one of the leading exporters as well as one of the leading importers of tomatoes, and the value of imports in 2011 stood at US$2220 million, and the exports grew at a CAGR of 22.9% during the period 2009 to Germany, Russia and United Kingdom are major importers of tomatoes and their share in world imports of tomatoes during 2011 stood at 15%, 9% and 8%, respectively. The world imports of tomatoes have displayed growth and the values of exports have increased from US$ 7191 million in 2009 to US$ 8692 million in Other tomato importing countries are France, Netherlands, Canada, Sweden, Poland and Italy. Top importers of tomatoes (2011) Trade Source: FAOSTAT Mexico is the largest exporter of tomatoes, with 24% share in the aggregate production. The value of exports stood at US$ 2093 million, and its exports increased at a CAGR of 31% during the period 2009 to The world exports of tomatoes have also displayed a rise, and the value exported increased at a CAGR of 11% during The other Source: Trademap 8

9 Indian Scenario There has been sizeable increase in acreage as well as production of tomato in India. The area under tomato production has risen from 566 thousand ha in to thousand ha in The production of tomato has increased at a CAGR of 16% during the period to Andhra Pradesh is the largest tomato producing state with thousand ha under its production in , while the productivity in the State stood at 20 mt/ha. The other tomato producing states in India are Karnataka, Orissa, Madhya Pradesh, Maharashtra, West Bengal, Bihar, Gujarat, Chhattisgarh, Tamil Nadu and Haryana. Tomatoes can be grown throughout the year, and several varieties are grown in India. The important ones are Arka Saurabi, Arka Vikash, Arth-3, Arth-4, Avinash 2, BSS 90, Pusa Divya, Pusa Early Dwarf, Pusa Hybrid 1, 2, 4, Pusa Sheetal, CO3, HS 101,102,110, Hisal Anmol and Hisar Arun. Area, Production and Productivity of tomatoes in India India s trade in tomato Exports Year Area Production Productivity (000 HA) (000 MT) (MT/HA) Source: NHB Tomatoes are available throughout the year for exports. The high yielding F 1 hybrids are being cultivated by farmers on quite a good scale. Excellent research support is provided by all the State Agriculture Universities, and National Research Institutes like IIHR, Bangalore and Indian Institute of Vegetable Research, Varanasi. Distribution of raised seedlings of F 1 hybrids is prevalent, and is getting popular among vegetable farmers. APEDA has established a number of Agri Export Zones for vegetables, namely in Punjab, U.P., Gujarat, Bihar, Jharkhand, and West Bengal, for promoting exports of vegetables, and infrastructure facilities are also being improved. Pakistan is the largest importer of tomatoes from India and the value of imports were US$ million in The other tomato importing countries from India are UAE, Bangladesh, Nepal, Saudi Arabia and Maldives. India s exports of tomatoes (Value in US$ Million) Country Pakistan UAE Bangladesh Nepal Saudi Arabia Oman Maldives Bahrain Russia 0.06 Malawi 0.04 World Challenges: Source: DGCIS In spite of tomato being grown throughout the country, the export performance is not very encouraging due to certain challenges: India s yield in tomatoes is not as much as that of other countries, like USA, Spain, Italy, Egypt and Brazil. There is an urgent need to enhance productivity as well as quality of produce to meet the buyer requirements worldwide. There is no proper storage technology for tomatoes available in India. Being highly perishable in nature, tomato has limited shelf life. It creates glut during production season and becomes scanty during off-season. Short shelf life coupled with inadequate processing facilities results in heavy revenue loss for the country. The challenge of diseases and pests is also prevalent among tomato producers in India. Good cultural practices can reduce or eliminate problems. Thus, it is imperative to use diseaseresistant varieties. Stink-bugs cause spots and internal damage to tomato fruit by their feeding. Limitations in marketing facilities also pose a problem to the tomato producers. Low market prices, at times, discourages the producers. There are also limitations in processing facilities for tomatoes, thus, a need exists to develop suitable technology for processing and preservation of this valuable produce in such a way that it will not only check losses but also generate additional revenue for the country. 9

10 IPR in Agriculture Overview Intellectual Property (IP) refers to the protection of creations of the mind, which have both a moral and a commercial value. Plant Protection Legislations in Various Countries USA IPR initiative first was introduced in the US in 1930 in the form of the Plant Patent Act (PPA), allowing patent protection for asexually reproduced plants and cultivars (except tubers). In 1970, patent protection was extended to sexually reproduced plants by the enactment of the Plant Variety Protection (PVP) Act. IP protection in the US was further extended by the enactment of patent protection for plants under the Utility Patent Act. The variety to be protected was required to be uniform, stable and distinct from all other varieties. The exclusions were fungi, bacteria, first generation hybrids and varieties sold or used in the US for longer than one year or more than four years in a foreign country. Europe In Europe, IPR was first enacted by a Plant Variety Protection Act in 1942 in the Netherlands, followed by Germany in In Europe, a patent can only be obtained if the technical feasibility of the invention is not limited to the specific variety for which protection is sought, i.e., it must be possible to reproduce the invention in more than one variety. The national regimes were then extended to other countries by establishing the International Convention for the Protection of New Varieties of Plants of 1961, creating a Union for the Protection of New Varieties of Plants, or UPOV (Union pour la Protection des Obtentions Végétales). The UPOV Convention called for the adaption of existing breeder s rights regulations in the contracting states. The European Patent Convention (EPC) was then established in Europe for patent protection, which states that European patents shall not be granted in respect of plant or animal varieties or essentially biological processes for the production of plants or animals. This exception excludes from patentability matter which was protectable under independent plant variety protection acts. The EU Biotechnology Directive, while not permitting the patenting of plant varieties, provide for farmers exception where a patent on genetic material would otherwise prevent reuse on the farm. It also contains a provision for compulsory licensing, subject to certain conditions, where a breeder s use of material would otherwise infringe a patent right. IPR in Indian Agriculture The Indian Patent Act, 1970, and its subsequent amendments, state that patent could be applied mainly on agricultural tools and machinery or the processes for the development of agricultural chemicals. However, methods in agriculture or horticulture, life forms of other microorganisms like plant varieties, strain/ breeds of animals, fish or birds as well as products derived from chemical/biochemical processes, and any process for medicinal, surgical, curative, prophylactic, or other treatments of animals or plants to render them free of diseases, or to increase their economic value, or that of their products as such, earlier did not constitute patentable subject matter. India had no legislation to protect plant varieties. However, after becoming a signatory to TRIPS Agreement, it became mandatory to provide protection for plant varieties either by patent or by an effective sui generis. Accordingly, India has in place a sui generis system for protection of plant varieties integrating the rights of breeders, farmers and village communities. As a result, In India IPR protection came into being for new plant varieties, in the shape of the Protection of Plant Varieties and Farmers Rights (PPVFR) Act in 2001 Protection of Plant Varieties and Farmers Rights (PPVFR) Act, 2001 Following are some of the declared advantages of the Act in India: (i) (ii) It allowed for superior planting material, leading to increased agricultural production. Facilitate investment by private sector enterprises in the development of superior plant varieties and also to give impetus to the infrastructure for the seed industry. (iii) Encourage competition between the private and the public sector in the field of plant breeding effectively and efficiently in the larger national interest. (iv) Enable India to meet its national commitment under the international agreement on tariffs and trade (WTO) Benefits The Act seeks to protect farmers from exaggerated claims by seed companies regarding the performance of their registered varieties. The Act also seeks to ensure that the seeds of these new varieties are of good quality, or atleast farmers are adequately informed about the quality of seed they buy. In addition, it establishes a system for an effective means of protecting plant varieties and the rights of farmers and plant breeders, while at the same time encouraging the development of new plant varieties ensuring farmers rights to save, use, exchange and sell seeds. 10

11 The PVP Act in India benefits the registered breeder to save, use, sow, re-sow, exchange and share and sell new variety and also allows the breeder who has obtained registration of a new plant variety to prevent others from selling, exporting, importing or producing such variety without breeder s permission. Other Forms of IP Protection in Agriculture In USA, there are separate trade secret laws at the State level. Unlike patents, protection of trade secrets is not time-limited and is also of free of obligation to disclose the inventive or creative idea to society. However, the disadvantage of such protection is that the protection is lost in the moment the same idea or invention is discovered independently by a third party. Marks used in commerce can be applied to both agricultural and industrial products and services. Trademarks, for example, may be applied to market seeds or spraying services. The main objective of Categorisation Matrix of Interplay and Implications in IPR the trademark is to distinguish the goods and services of enterprise from another, thus preventing the consumers from deceptive products. Such protection also prevents the wrongful use of commercial marks, which is not limited in time, although registration may have to be renewed on periodic intervals. A category of commercial marks more often used in agriculture are Geographical Indications (GI). These are marks associated with products originating from a country or region or locality where the characteristics of the product are essentially attributable to its geographical origin. For example, Darjeeling for tea produced and traded from this district in India; Devgad or Ratnagiri for mangoes; Tasgaon for grapes. Those plant varieties that have been developed using traditional knowledge and are associated with particular region can also be protected as GI with an advantage of not having time-limited protection as in the case with plant patent or plant breeders rights. However, in the case of GI for an agricultural product, commercial benefits can be derived only when the name of the place is associated with the agricultural product. Trade secret protection can be used by the agricultural sector to protect, for instance, hybrid plant varieties Note: PBR Plant Breeders Rights; TM Trade Mark; TS- Trade Secret; CM Company Registry; a) Number of asterisks denotes the magnitude of impact. b) Number of + s and - s represents the magnitude of positive and negative impacts. Source: ICAR 11

12 News Focus Sugarcane crushing picks up in India; 476 mills commence operations for : There was a decline in the production of sugar in 2013 due to the delay caused by the sugar mills as there were issues concerning the prices of sugarcane. Around 476 mills started their crushing operations by December 31 st 2013, for the sugar season. Although the number of mills was lesser than in the corresponding period last year, it can be concluded that the sugar production is slowly catching up with the last year s trend. The total sugar production in India till December 31, 2013 was about lakh tonnes, which is 29% less than the production in the corresponding period last year. Maharashtra crushed about 217 lakh tonnes of sugarcane with 154 sugar mills engaged in the crushing operation. The number of mills crushing sugar in Maharashtra last year was 161 and these mills crushed about 278 lakh tonnes sugar. In Uttar Pradesh, last year, 122 sugar mills were operational, while in mills undertook crushing operations which has led to 42% less sugar production from the State, in 2013, over the production in the previous year. This was due to the late start of the crushing operations. Moreover a longer rainfall season, which started ahead of the normal schedule, seemed to have impacted the number of tillers in the field and in turn, adversely impacted the yield in the central and eastern parts of Uttar Pradesh. Karnataka has produced 12 lakh tonnes of sugar, and 58 sugar mills have started their crushing operations. The cane pricing problem between the state government and the mills has also been affecting crushing. Andhra Pradesh produced 2.52 lakh tonnes of sugar, and 33 mills were operational in The same number of mills was operational last year also in the state; however, the sugar production was 18% less in the last year. Tamil Nadu has produced 1.5 lakh tonnes of sugar, 58% less than that of last year, which is attributed to the late start of the crushing season. Sugar production in Tamil Nadu is expected to be significantly lower than last year due to the lower cane availability in the state. The news items and information published herein have been collected from various sources, which are considered to be reliable. While every care has been taken for authenticity of the material published, Exim Bank accepts no responsibility for authenticity or accuracy of such items. Export-Import Bank of India, Centre One Building, Floor 21, World Trade Centre Complex, Cuffe Parade, Mumbai Tel: Fax: cag@eximbankindia.in Agri Business Group: agrigroup@eximbankindia.in/sumana@eximbankindia.in Website: Contact Numbers: Ahmedabad: , Bangalore: , Chandigarh : /12, Chennai: Guwahati: , Hyderabad: , Kolkata: , Mumbai: , New Delhi: , Pune: , Addis Ababa: (251116) , Dakar: (22133) , Dubai: (9714) , Johannesburg: (2711) , London: (4420) , Singapore: (65) , Washington D.C: (1202)