Kerala State Cashew Development Corporation (KSCDC) stands as an exception in the flippant imagery of loss making public sector initiatives. The corporation has broken all the rules in cashew production, processing and export, proving that unbelievable things can happen in the drudgery of such initiatives.
Now, with a turn over exceeding Rs.175 crore, 20,000 workers and 30 factories, the corporation is going places with Gulf, Middle-east and North Africa in its marketing agenda. And if everything goes well, it can even munch the market share for cashews in Russia and China in a while.
Sufficient management will-power and acumen can create turn around stories is the testimonial message that KSCDC has to give.
The architect of this turnaround story-- Dr.K.A. Ratheesh, CMD, KSCDC--speaks to Rakesh Neelakandan of Commodity Online about the future plans and the limitless skies that KSCDC intends to chart. Excerpts:
Currently KSCDC has a single brand and four products under the umbrella CDC Cashews. When can we expect new products, and what would they be?
We have entrusted the Central Food Technology Research Institute to come up with additional products, and cashew noodles and chocolate-coated cashews are in the laboratory. It has been noticed that cashew noodles face the problem of brittleness which the researchers are trying hard to address. Since the products are under developmental phase, it is too early to say anything more about them.
We have asked CFTRI to come up with products in a year. The research, of course is funded by KSCDC.
In 2008, KSCDC entered the Gulf market. Which product did KSCDC launch in 2008? Did KSCDC have any campaigns in place then?
In 2008, we launched Cashew Soup, Cashew Powder (a spice mixture for cooking), Cashew Vita (health drink) and Cashew Bits in the Gulf market. That was a test. Finding healthy response, we have tied up with the EMKE group to market the products.
We understand that KSCDC have launched a new campaign in Dubai following the success of products in Gulf. What is the theme of campaign? What is the medium of campaign?
As of now, we are having no campaigns in place and there are no promotionals, though we are facing stiff competition from countries like Vietnam and Barzil. Even cashew products arrive from Germany with the label,”packed in Germany”.
The productivity of Vietnamese cashew sector is worth mentioning.
80% of KSCDC production is exported with USA being the largest export destination. Which are the other major destinations?
India is the biggest producer, processor, exporter and consumer of cashew kernels in the world. Though it can be argued that 80% is exported; in reality, only 50% is exported with the rest being consumed here.
We face certain problems while we export to US and UK…
Please elaborate…
The US retailers like Walmart procure cashew kernels (unbranded) from us, pack it and sell it as their own. They off take it for some Rs.250 for a pack and sell it for around Rs.1000.
But, when we approach them with branded, value-added products, they raise various technical issues. Corporate lobbying is really strong there and we are at a disadvantage.
Hence, we have requested central government backing in this regard. Additional financial backing is also requested to promote the brand.
What are KSCDC’s plans for the domestic market? How are the four marketing establishments in four regions of the country performing?
We are having low market penetration levels in the domestic market.
The retail chains are having certain procurement policies involving 30-60 days of credit windows. Being a government organization, we have certain limitations in towing this line. But requirement exists in the domestic market.
We also have to find ways to create customer awareness especially with regard to the health benefits that cashew gives. The State government support has been encouraging in this regard, contributing funds to brand development.
When will KSCDC start exporting to China and Russia?
We face various issues there. Especially tariff issues in China. Countries like Vietnam can export cashew on zero duty, where as we cannot. Hence, we are eyeing Hong Kong as a gate way to China. Various discussions are being held in the regard and they are progressing.
The banking sector in Russia is unorganized and that has created problems. We have difficulties in securing Letter of Credit and transfer funds.
As published in:http://www.commodityonline.com/news/Poor-overseas-corporate-lobbying-puts-Indias-branded-cashews-on-backfoot-36473-3-1.html
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