 "Anil Khule, one of the wealthy farmers")
In December, when unseasonal rains battered crops in various parts of Maharashtra, Anil Khule from Pimpalgaon was able to save 1.5 acres of his grape yields because of a prudent decision to cover them with special plastic from Spain. The canopies were a costly investment at Rs 6 lakh per acre, but the wisdom of the step showed in the bruised grapes on the periphery and the lush green ones under the shade. The advice had come from a source he trusted -Mahindra & Mahindra, or in Khule's words, the "company". For nearly a decade now, the tractor-maker has been trying to boost productivity in rural Maharashtra by employing technology to achieve what it calls "farm tech prosperity". The initiative has helped the company emerge as the largest exporter of grapes from India.
With its history of manufacturing farm vehicles since the early 1960s, Mahindra & Mahindra had an enduring connect with rural India. This, the company claims, led it to invite farmers to raise production standards and sell to international markets. Grape exports had been initiated on a small scale around 2005 by Mahindra Shubhlabh Services, a subsidiary that also dealt with seeds, fertilisers and chemicals. These aspects of the farm business were separated in 2010 and merged with the parent Mahindra & Mahindra, leaving Mahindra Shubhlabh Services to focus exclusively on fruits. Since then, it has stepped up efforts to convince local growers to turn to export-variety grapes. The company also launched grapes and apples under the brand Saboro aimed at quality-conscious customers internationally and in India. Further, there is a push to time harvests around the festival season in December-January rather than February-May. All this, it says, will boost farm productivity and income.
Although a recognised name, farmers initially met the company's advances with a mix of interest and scepticism. "For a farmer in some tehsil of Nashik, it is very difficult to create a brand and sell to international consumers," says Ashok Sharma, chief executive of agri and allied businesses at Mahindra & Mahindra. Some big farmers had already been experimenting with exports, while smaller players stuck to domestic grapes. A few wealthy farmers, Deepak Mahale for instance, whose uncle was an MLA in Nashik, agreed to sign up. But others like Sanjay Jadhav had their doubts. Sharma gathered a group of farmers and held discussions with the firm for an entire day, with their queries centred mainly on payments. Hedging his bets, Jadhav initially followed Mahindra & Mahindra's practices only on three of his seven acres. Improved productivity soon prompted him to convert entirely to export-oriented farming, says Jadhav, standing amid neatly arched grapevines.
There is a "big philosophical difference" in the approach of the company versus the rest of the industry, notes Sharma. "Normally, traders start when the produce is ready - they just go and buy. We begin at the start of the season when the land is barren." The initiative was named Khet se Khalihan Tak. Under it, the staff invites interested farmers and studies their track record before registering the ones who seem keen and hard working. The chosen ones are provided step-by-step guidance through a combination of technology and on-field help. The model is unique in that it currently allows farmers a choice when it comes to buying inputs and selling produce - there is no compulsion to deal exclusively with Mahindra & Mahindra but the company says most of them prefer to work with it anyway. For this, a service fee is deducted from the price realised by the farmer. Dattatray Dhonderam of Bopegaon, who joined Mahindra & Mahindra's programme in 2013, says yield per acre has risen to 10 tonne against the 6-7 tonne earlier.
At Pimpalgaon, around 35 kilometres from Nashik, field officer Kishore Dhumal guides 35 farmers. He visits them every week. There are 12 other agronomists like him for operations in Maharashtra. It takes constant to-and-fro to ensure standards are met, says Dhumal, who earlier trained at National Research Centre for Grapes and bears some resemblance to the Marathi actor Lakshmikant Berde. Some of his work may soon be reduced by Mahindra Mitr, a Marathi app the company has developed which includes tips, videos and quizzes to help with each stage of the crop. Grapes are a tricky fruit to grow, observes Dhumal who himself maintains some vineyards. They are expensive, require painstaking care and are highly susceptible to disease. "So it is mainly the better-off farmers, who are somewhat prepared to take a hit, who get into it," says farmer Khule, adding that two failed crops can mean a lifetime of debt for smaller farmers.
In the past, farmers had struggled with spot traders delaying payment, or worse, paying less than promised. Often, those who had independently toyed with export-style crops had their stocks rejected because they did not meet standards. European Union regulations are famously strict, with rejections even for "ugly" or misshapen fruit. Lack of knowledge or the dissemination of wrong knowledge used to be another bane. Khule, for instance, rues that he believed local lore that the Dogridge rootstocks that provide a strong base for grape grafting were ineffective. He stuck to the own-root system, a costly error that he cannot undo for a few more years. Field officers monitor regulations and inform the viticulturists about permissible chemicals and residue levels.
The grapes for export have specific features. Mahindra & Mahindra focuses on table grapes, seedless with large, even-coloured berries. There are no surprise bursts of saccharine or sour as with bunches bought from the neighbourhood handcart. The most popular variety is the green Thompson, while some farmers also grow a black variety named Sharad Seedless after Sharad Pawar, and reds like Crimson Seedless and Red Globe.
According to Guy Goves, head of the farm business at Desai Fruits and Vegetables, Indian farmers end up with less than 20 per cent of the final retail price against the 50 per cent earned by their United States counterparts. Export grapes normally sell for around a double of the price of domestic ones. Jadhav proudly shows off his recently refurbished house, while Khule seems familiar with a smartphone and terms like app, Bluetooth and download.
The results for Mahindra & Mahindra have been encouraging so far. New registrations have been halted after the company signed up 700 farmers, including in Nashik, Sangli, Latur and Solapur. The applications from farmers have not stopped, says Popat Raut, Mahindra & Mahindra's area manager for Pimpalgaon. From six containers in 2005, the volume rose to 668 containers in 2014. In Mahindra & Mahindra's view, the organised fruit market appears to be an underexploited opportunity. The fruits industry in India is around Rs 3 lakh crore and growing at a compounded annual rate of 7-8 per cent, of which only 5 per cent falls in the organised and branded market. Seated in his office at the company's Kandivali premises, chief executive Sharma says the big challenge is bringing uniformity in the farmers' adoption of global practices. This is consistent with the experience of other big companies in the business. Companies like Bharti's FieldFresh Foods and startups like INI Farms that sell branded pomegranates and bananas work with farmers on contract.
Goves of Desai Fruits, which sells bananas, says that farmers continue to refrain from removing smaller fruits from a bunch for fear it would lose weight. These get rejected anyway. There is also the struggle to find reliable labourers. Desai Fruits is trying to overcome this by including them alongside farmers in their training programmes. "Because labour is an integral part of the value chain, you have to keep educating them too," Goves explains. Last year, Mahindra & Mahindra tied up with Belgium's UNIVEG to improve its supply chain and post-harvest methods. UNIVEG CEO Francis Kint expects more international companies to find opportunities in India as the country looks to market a very perishable product.
The government could help too, feels Khule. The plastic covers that protect his fields are levied a 30 per cent import duty, he says. Rather than announce compensation in the event of a calamity, subsidies on such protective materials could be of more help to farmers, he says.
