Cremica to start contract farming

In order to improve its share of domestic as well as international market, Punjab-based Cremica Foods group in 2006 is planning to start farming special varieties of tomatoes and onions on contract.

"We are increasing our production capacity, considering the increasing demand for gravy and sauce. But at the same time, we have to maintain the quality also and to meet that we have decided to enter into farming tomatoes and unions on contract," said Akshay Bector, managing director, Mrs Bector Foods Specialties Ltd (MBFSL).

The group has got an order for ready-to-cook gravy from a Dubai-based company, Hot Brands. Apart from this, a US-based tomato ketchup company had closed shop and outsourced 100 per cent production to the Cremica group last year.

Bector said, "We will be supplying 100 tonnes of tomato ketchup to a UK-based firm every month by the end of 2005-06. Moreover, we got a special order of shipping ready-to-cook gravy to Hot Brands".

"The trial of four different gravy varieties "" Kadai, Rogan Josh, Rajhma, and Rojana "" has been successful with Hot Brands and now we are supplying three to four tonnes each of the four types of gravy," he said, adding every month the ready-to-cook gravies shipment to the Middle East will be about 16 tonnes.

"Moreover for Hot Brands, we are doing large-scale production in a special pack of 1.25 kg, whereas the 250-gm pack is solely for the domestic market. During 2004-05, our sauce production capacity was 500 tonnes a month, which is now 1,800 tonnes. We have planned to increase the production capacity to 2,800 tonnes by the end of 2005," he said, adding in 2004-05, "our turnover was Rs 15 crore for sauce, which is 80 per cent more than in the previous financial year".

"During the current financial year, sauce will generate sales of Rs 25 crore, including exports of Rs 2 crore. Apart from this, gravy will contribute Rs 10 crore during this financial year, and in the next two years, there will be capital investment of Rs 25 crore. We are expecting about 80 per cent growth for sauce and gravy every year over the next five years," he added.