Market analysis of walnuts in India
The relevance of research
Walnuts are used in their natural form and for the preparation of various dishes, in the cuisines of Asia they season meat. Halva is made from walnuts, all kinds of spicy sauces are prepared. In the confectionery business with nuts, cakes, cookies and cakes are prepared, added to ice cream
Purpose of the study
Analysis of the state of the walnut market, assessment of the market size, analysis of competitors, as well as identification of factors affecting the walnut market
Content
Part 1. Overview of the Indian walnut market
1.1. Main characteristics of the market
1.2. Dynamics of the market volume of walnuts 2016-2020 Potential market capacity
1.3. Assessment of factors affecting the market
1.4. Life cycle stage of the walnut market
1.5. Competition from substitute products
Part 2. Competitive analysis in the walnut market
2.1. Major players in the market
2.2. Market shares of the largest competitors
2.3. Profiles of major players
Part 3. Analysis of walnut production
3.1. Volume and dynamics of domestic production of walnuts
3.2. Export share in walnut production
3.3. Segmentation of walnut production by region
3.3.1. Production by Union Territories
3.3.2. Production by states of India
Part 4. Analysis of foreign trade deliveries of walnuts
4.1. Volume and dynamics of imports of walnuts
4.2. Import structure
4.3. Volume and dynamics of walnut exports
4.4. Export structure
Part 5. Analysis of consumption of walnuts
5.1. Dynamics of consumption of walnuts
5.2. Analysis of the results of tenders for the purchase
Part 6. Price Analysis
6.1. Average producer prices by union territories
6.2. Average consumer prices by states in India
Part 7. Assessment of factors of investment attractiveness of the market
Part 8. Forecast for the development of the walnut market until 2025
Part 9. Recommendations and conclusions
Research excerpt
Part 1. Overview of the Indian walnut market
1.1. Main characteristics of the market
Companies operating in the Indian walnut market can be divided into three main categories:
- producers growing and selling processed nuts (peeled, roasted and packaged);
–– producers growing and selling nuts for further processing;
– Packing companies that use mainly imported raw materials.
At the same time, the industrial production of nut crops in India is not developed, although the demand for nuts is growing steadily.
A variety of climatic conditions and large areas of agricultural land are an important advantage of Indian agriculture. In practice, this means that the southern regions of India can become major producers of walnuts.
The advantages of the walnut business are currently determined by the following factors:
–– Availability of stable demand in the market (the shortage of walnuts in Europe alone is 100 thousand tons of fruit kernels);
–– Waste-free business production (wood, leaves, branches, roots are raw materials for light, food, chemical and pharmaceutical industries);
–– Multi-year profit (100 years or more);
–– Long shelf life of the product, no special storage conditions and simple transportation conditions;
–– Business diversification by product type (different types of nuts), its sustainability, yield and purpose.
In India, there are enough areas suitable for growing walnuts, but the walnut industry itself is practically not developed.
Currently, India covers its needs for walnuts by importing (importing) products, but the need is not fully realized, which contributes to price gouging in the market.
Diagram 1. The ratio of imported and domestic products in the walnut market, 2016–2020, %
1.2. Dynamics of the market volume of walnuts 2016–2020 Potential market capacity
The volume of the market is significantly affected by import deliveries.
Throughout 2020, there has been an increase in global walnut production with notable increases in almost all major producing countries.
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The walnut industry in India, thanks to a developed domestic market and high climate potential, has excellent development prospects. But the realization of these prospects requires solving the issue of providing the industry with long-term credit funds.
The main driver of market growth is the expansion of the range of nut snacks, positioned as ""healthy"" products. The health benefits of walnuts are recognized all over the world: they appear in retail healthy snacks and as a main ingredient in many foods and drinks such as cakes, cookies, nut mix, walnut flavored snacks and products, etc.
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1.3. Assessment of factors affecting the market
Let's consider the main factors influencing the market and, accordingly, demand.
Economic
India GDP
GDP is a macroeconomic indicator that reflects the market value of all final goods and services produced in a year in all sectors of the economy on the territory of the state for consumption, export and accumulation.
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Социальные
Population
During 2012–2017 India's population has shown a positive trend. However, in 2018, the vector changed – the population decreased due to the natural population decline in 2016–2019.
The current demographic situation in India is characterized by natural population decline (since 2017), which is accelerating, and migration growth, which does not compensate for natural decline.
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Real income of the population
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Diagram 6. Dynamics of real incomes of the population of India, % to the previous year, 2012–Sep. 2021
Healthy lifestyle fashion
A healthy lifestyle is becoming an increasingly fashionable and relevant topic for young and active residents of large cities. It requires a conscious attitude to many habits, especially those related to physical activity and human nutrition.
Thanks to the constant access to information, today's healthy users are much more aware of what and why they eat than previous generations. They are responsible for building a diet and the foods they eat. The leader of the list of useful products are walnuts.
technological
Long wait for the first harvest
Walnut during seed propagation, the first fruits begin to give in 7-10 years. It enters the stage of industrial fruiting at the age of 13-15. Grafted plants begin to bear fruit earlier, at 4–6 years. They are able to form industrially significant crops for 7-8 years. After fruiting, the nut is able to almost annually.
Increasing walnut product options
In China, the production of vegetable milk from walnuts is actively developing. Yangyuan Beverages has set up the China Nut Industry Research Institute to make the most of walnuts and discover new applications.
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New varieties
In the summer of 2021, scientists from the Samara National Research University named after Academician S.P. Koroleva during breeding work, two new varieties of walnuts were bred, which have a number of unique qualities: they withstand the adverse weather conditions of the Middle Volga region (quick transition from cold winter to rather hot summer, drought, moisture deficiency, frost), and their shell is so fragile, that in order to get to the kernels, it is enough just to squeeze the nuts in your hand.
Political
State support
– Grants for the development of the material and technical base of agricultural consumer cooperatives. Grant funds for the development of the material and technical base can be used for the following expenses: acquisition, construction, overhaul, reconstruction or modernization of production facilities for the procurement, storage, underworking, processing, sorting, slaughter, primary processing, preparation for sale and sale of agricultural products , wild fruits, berries, nuts, mushrooms, seeds and similar forest resources and products of processing of these products and resources; to pay interest on the loan within 18 months from the date of receipt of the grant, etc.
–– Reimbursement of part of the cost of paying interest on investment loans received from Indian credit institutions and loans received from agricultural credit consumer cooperatives. For example, for the purchase of equipment, specialized vehicles, special equipment in accordance with the list approved by the Ministry of Agriculture of India, equipment for the conversion of trucks, tractors and agricultural machines to gas motor fuel and breeding products (material), as well as for the laying of perennial plantations and vineyards, construction and reconstruction of grafting complexes for perennial plantations, etc.
–– Support for the horticulture industry for the establishment and (or) care of perennial plantations, including nurseries, including the installation of trellises, and (or) anti-hail nets, and (or) irrigation systems, and (or) uprooting of decommissioned perennial plantations and other areas of state support.
The growth of walnut plantations
The expansion of fruit and berry plantations is one of the priority areas for the development of the agro-industrial complex, for which agricultural producers can count on incentive subsidies. According to the plans of the Ministry of Agriculture, by 2025 it is planned to lay at least 65,2 thousand hectares of orchards and fruit nurseries in India.
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Concluding the assessment of the impact factors on the Indian walnut market, we will summarize the key ones in the framework of the STEP-analysis.
According to the results of the performed STEP-analysis, macro-environment factors have a more positive impact on the development of the walnut market.
The restoration of the population's solvency, the fashion for a healthy lifestyle, the development of new varieties of walnuts, the increase in walnut product options on the market, the growth of walnut plantations, government support, the stabilization of exchange rates and the recovery of GDP have a positive effect.
Table 1. STEP analysis of factors affecting the walnut market
1.4. Life cycle stage of the walnut market
The walnut market in India is in a growth phase.
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The growth stage is very important for companies, as it creates the most favorable conditions for dominating the market and for increasing profitability and stability. All efforts at this stage should be aimed at extending it, at creating entry barriers for new players, at achieving maximum market coverage - all this will ensure the most comfortable existence of companies at the next stage of the life cycle.
It should be noted that walnuts are a traditional element of nutrition for the domestic consumer, as a result of which the walnut market has repeatedly gone through stages of growth, stability, and decline. Currently, the walnut market is experiencing another round of its development. The growing popularity of the trend of a healthy lifestyle and proper nutrition contributes to the active growth of the market.
1.5. Competition from substitute products
Other nuts can be attributed to substitute products for walnuts. However, each nut has its own strengths. Consider the beneficial properties of some popular nuts.
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Rospotrebnadzor recognizes cashews, hazelnuts, walnuts, and pine nuts as the most useful nuts and reports that they must be eaten at least once a week to maintain health. However, the cost of these nuts is quite high.
Due to the decline in real disposable income, consumers have begun to prefer nut mixes, which include different types of nuts and candied fruits. This is due to the fact that such products are cheaper and conveniently packaged, in addition, they are well suited for a snack on the run.
Thus, taking into account the beneficial properties of nuts popular with Indian consumers, as well as the price factor, it can be concluded that substitute products have a significant impact on the walnut market.
Part 2. Competitive analysis in the walnut market
2.1. Major players in the market
The main market participants in 2020 were import players. The main beneficiaries were both wholesale companies and companies that package/process walnuts for further resale.
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2.2. Market shares of the largest competitors
The largest player in the Indian market is...
2.3. Profiles of major players
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Part 3. Analysis of walnut production
3.1. Volume and dynamics of domestic production of walnuts
The production of walnuts by agricultural enterprises, peasant farms and individual entrepreneurs is rather poorly developed. With the annual growth of imports, the gross harvest of products is reduced. In 2020 walnut production amounted to ...
Diagram 9. Dynamics of walnut production in India for 2016–2020, tons
Conducting a competitive analysis in the walnut market is complicated by the fact that Indian producers are represented mainly by individual entrepreneurs and peasant farms. Thus, we will take the revenues of the main recipient companies of walnuts imported to India as the basis for the calculation.
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3.2. Export share in walnut production
The share of exports in the production of walnuts is calculated by GidMarket analysts excluding re-exports.
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3.3. Segmentation of walnut production by region
3.3.1. Production by Union Territories
Climatic conditions in the southern regions of the country make it possible to grow walnuts, so almost all production is concentrated in two federal districts: the Southern and North Caucasian, which, by the end of 2020, account for ...% of the total gross harvest of walnuts in India.
Тtable 5. Dynamics of walnut production in India by union territories, 2016–2020, tons
3.3.2. Production by states of India
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Part 4. Analysis of foreign trade deliveries of walnuts
4.1. Volume and dynamics of imports of walnuts
During 2016–2020 The dynamics of walnut imports to India shows an annual growth.
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4.2. Import structure
In the structure of walnut imports by importing countries in 2020, the key supplier in monetary terms is China, which accounts for ...%.
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4.3. Volume and dynamics of walnut exports
The dynamics of exports of walnuts to India in physical terms has a multi-vector orientation.
The volume of exports of walnuts from India in monetary terms in 2020 amounted to ...
Diagram 16. Balance of exports and imports, 2016–2020, million Rs.
4.4. Export structure
The main volume of walnuts, in value terms, is supplied to Kazakhstan in 2020 ...
Here is the data on the largest exporters of walnuts in 2020, indicating Indian production in customs declarations.
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Part 5. Analysis of consumption of walnuts
5.1. Dynamics of consumption of walnuts
Estimated consumption per capita was made by GidMarket based on the ratio of the market size of walnuts to the population of India.
Diagram 18. Dynamics of consumption of walnuts in physical terms, 2016–2020, g/person
5.2. Analysis of the results of tenders for the purchase
Every year, companies hold more than a thousand tenders for the supply of walnuts, however, we note that often walnuts are purchased in conjunction with other food products, constituting a low share in the total purchase. Most tenders are held in the form of an electronic auction.
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Among the customers of walnuts in 2019-Oct. 2021 JSC ""XXX"" is in the lead...
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Part 6. Price Analysis
6.1. Average producer prices by union territories
The price of walnuts depends on a number of factors:
- Yield. Prices are significantly affected by the fact how fruitful the year turned out to be. Naturally, against the background of limited supply, the price rises;
- Seasonality. The price of young nuts of a new crop is always higher than last year's, and the demand for them is greater. Accordingly, not a single manufacturer and supplier will miss the opportunity to sell their product at a higher price;
–– Course ups and downs. Prices for walnuts, as well as for other imported goods, follow the dollar.
Due to the limited domestic production of walnuts in India, the price analysis presents the prices of shelled walnuts offered by import producers.
6.2. Average consumer prices by states in India
Here is the data on prices for nuts in the Indian market according to Rosstat. The difference in prices for nuts in different regions is similar for the walnut market.
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Ordinary buyers rarely buy walnuts in kilograms, more often in small bags - from 100 g to 200–300 g. In a small package, the cost of a larger weight unit is higher, but this does not scare the buyer away, on the contrary, this way the goods are more accessible to him.
Part 7. Assessment of factors of investment attractiveness of the market
The positive factors of the walnut market investment climate dominate over the negative ones.
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The most significant positive factors.
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The most significant negative factors.
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Part 8. Forecast for the development of the walnut market until 2025
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The following factors also allow predicting the dynamics of the walnut market volume:
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Part 9. Recommendations and conclusions
The industrial production of walnuts in India is not developed. India meets the demand for walnuts with the help of imports of products.
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Macro-environment factors have a more positive impact on the development of the walnut market. Among the main positive factors, one should highlight the restoration of the population's solvency, the fashion for a healthy lifestyle, the development of new varieties of walnuts, the increase in the market for walnut products, the growth of walnut plantations, government support, the stabilization of exchange rates and the recovery of GDP.
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Diagrams
Diagram 1. The ratio of imported and domestic products in the walnut market, 2016–2020, %
Diagram 2. Dynamics of the market volume of walnuts, 2016–2020, tons
Diagram 3. Dynamics of India's GDP, 2012-Sep. 2021, % to the previous year
Diagram 4. Monthly dynamics of the US dollar against the rupee, Rs. for 1 US dollar, 2016-Nov. 2021
Diagram 5. Population dynamics in India, as of 01 Jan. 2012–2021, million people
Diagram 6. Dynamics of real incomes of the population of India, % to the previous year, 2012–Sep. 2021
Diagram 7. Industry life cycle stage
Diagram 8. Shares of the largest competitors in the walnut market in 2020, %
Diagram 9. Dynamics of walnut production in India for 2016–2020, tons
Chart 10. Dynamics of the total revenue of the largest producers (TOP-5) of walnuts in India, 2016–2020
Diagram 11. The share of exports in production for 2016–2020, %
Diagram 12. Volume and dynamics of imports of walnuts in physical terms, 2016–2020, tons
Diagram 13. Volume and dynamics of imports of walnuts in monetary terms, 2016–2020, thousand US dollars
Diagram 14. Dynamics of export of walnuts in physical terms, 2016–2020, tons
Diagram 15. Dynamics of export of walnuts in monetary terms, 2016–2020, thousand US dollars
Diagram 16. Balance of exports and imports, 2016–2020, million Rs.
Chart 17. Structure of exports by countries in 2020, %
Diagram 18. Dynamics of consumption of walnuts in physical terms, 2016–2020, g/person
Diagram 19. Shares of walnut customers with NMTsK more than 50 thousand Rs., 2019-Oct. 2021, %
Diagram 20. Shares of regions for the supply of walnuts with NMTsK more than 50 thousand Rs., 2019-Oct. 2021, %
Diagram 21. Forecast of market volume in 2021–2025, thousand tons
Tables
Table 1. STEP analysis of factors affecting the walnut market
Table 2. Useful properties of nuts
Table 3. Main companies participating in the walnut market in 2020
Table 4. Profiles of companies participating in the walnut market in 2020
Table 5. Dynamics of walnut production in India by union territories, 2016–2020, tons
Table 6. Structure of imports of walnuts by importing countries in 2020
Table 7. Exports of Indian-produced walnuts, 2020
Table 8. Tenders for the purchase of walnuts, announced in 2019-Oct. 2021 with a contract amount of more than 50 thousand Rs.
Table 9. Average producer prices in the market of walnuts in the Union Territories, 2017–2020, Rs./kg
Table 10. Average Consumer Prices in the Walnut Market by State of India, 2016, 2020, Oct. 2021, Rs./kg
Table 11. Assessment of factors of investment attractiveness of the walnut market
Table 12. Forecast indicators of the development of the Indian economy
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