The call to produce locally more aggressively and the recent impetus given to the agriculture sector will surely spell a new dawn in the culinary arm of the HoReCa sector, but will require the much delayed upgradation of the local agri supply infra, says Varun Anthony, agriculture and food business consultant, who has earlier worked with the Government of Canada and the United States Department of Agriculture
The world launched the new decade with hope, vigour and enthusiasm. Travel plans were made, calendars were set, tickets were booked, hotel reservations were locked in as 2020 was all set to play host to a series of world events ranging from sports to politics. It was the leap year we were all waiting for – the start of the new decade!
And in one fell swoop it all went away – international borders were sealed, tickets were cancelled, hotel rooms went empty, buffet set-ups stood deserted, people were driven from each other’s presence into the confines of their homes. The world was suddenly turned into one large refugee camp with everyone looking to be rescued from the clutches of ‘The Invisible Enemy’.
The blow was not only seen through empty hotel rooms, grounded aircraft and buzzing travel destinations which were now nothing but ghost towns but was mainly seen in the very lifeline of the hospitality, travel and tourism industry which was embedded in its cuisine.
Food connected it all and now stood at the risk of being lost forever!
In the initial days of the global lockdown as the world began to scramble to get hold of the basic essentials, the agri-supply chain across the world and in India came under a stress test it had never trained for since its inception.
Suppliers across India and the globe had no other option but to halt production, shut factories, cut costs, trim workforce and in many cases bring down the shutters on their businesses permanently. The closure of borders within states and countries brought to a halt the delivery of existing products to the final consumer which made consumers and institutions scramble to make good with the stocks they had in their inventory and reach out and grab the additional stocks which they could lay their hands on. Now, when the pieces of the supply-chain puzzle itself are yanked away, it becomes virtually impossible to complete the puzzle to the last piece.
However, when we look at this messed up puzzle with scattered and lost pieces the questions we need to ask ourselves are – Is the damage permanent? Will we ever rise up from the dust? In my opinion – NO, the damage isn’t permanent and YES, we shall rise up from the dust.
Now let’s focus on the hospitality industry itself. Ever since India and the world locked down, consumers across the spectrum have been yearning to get back to what life offered them on the morning of January 1, 2020. Everyone is currently yearning to return and dine at their favourite restaurants, indulge in their favourite meals, sip their favourite wine, check in to their favourite staycations, cash in on those accumulated frequent flier miles and get the pages of their passports chopped. The world is raring to go while it claims that it is ready to embrace the ‘New Normal’. Hotel chains, airlines, cruise liners, travel destinations have all begun to remodel themselves, implement the strictest of hygiene protocols and usher in a new era across the entire industry. But, there’s always a catch to it.
It may look the same when we return to it, but will it ‘taste’ the same?
Let us take India. The hotel industry in India relies both on local as well as international produce and products when it comes to the culinary offerings made to its patrons. The budget hotels go entirely local while the luxury and star chains dip their baskets both into local and international produce and products.
While the budget hotels remain unchanged, I think there are going to be significant changes if not an entire 180 degree turn in the offerings of cuisines and ingredients which luxury and star brands make to its patrons when we enter the new normal. The two main changes:
Change 1: More Local
A greater focus is going to be laid on the use of locally grown and manufactured produce and product. Let’s take the recently announced ‘Aatmanirbhar Bharat Abhiyan‘ by Prime Minister Narendra Modi which called for all sectors across India to rise up, be self-reliant and take pride in locally produced products. The hospitality industry across India is certainly going to take up this call of the PM with all gusto.
With international travel closed, hotels across India are going to look to entice Indian consumers not to look abroad, rather indulge themselves in domestic travel and explore the diverse offerings and cuisines that India has to offer.
This will be seen through the following ways:
- Chefs across all segments of hotel chains and high-end restaurants across India are going to innovate, rebrand their menus and look at different ways to build a stronger and more loyal base for Indian cuisine not only amongst foreigners who visit India in the future but amongst those Indian travellers who are very accustomed to travelling abroad and having something international on their plates.
- Hotels (from luxury to budget) will focus on offering their patrons the local cuisine for which the geography they are located in is famed for.
- With the rise of locally manufactured premium products, luxury hotel chains across India are going to put to use these products in various ways across their properties such as mini-bars, food and beverage outlets within the hotel. A large number of hotel chains across India had already turned to locally manufactured premium products for their mini bars even before Covid struck.
- Locally grown ingredients; fresh produce; premium processed products such as frozen meats, cold cuts, jams, juices, dairy and dairy products will find their way to tables across the HoReCa segment in India and may entirely replace the range of imported products. The coming few months and years are going to see an exponential rise of producers of premium ingredients and products across India who take up the call for local manufacturing and meet the growing demand for premium yet cost effectiveness across the Indian food landscape.
In addition, and more importantly the measures which were announced for the agriculture sector through the Aatmanirbhar Bharat Abhiyan have been seen by industry as robust measures which will transform the entire sector.
The stimulus package will:
- Through the enactment of a law remove the restrictions on the flow of agricultural products across the country, thus enabling farmers to receive higher prices for their products. Quoting Finance Minister Nirmala Sitharaman who said, “The farmers will have a choice with barrier-free inter-state trade. There will also be a framework for e-trading of agricultural produce.
- The stimulus package will give rise to state-of-the-art agricultural assets and will serve as a strong platform for agritech innovation.
- With regards to state-of-the-art agricultural assets the package will enable cooperative societies, start-ups and others to create cold storage facilities and post-harvest storage centres. These will help farmers sell their products at a good price instead of having to sell them immediately to avoid spoilage.
- With regards to agri-tech, India is already home to more than 450 start-ups in the agriculture technology sector. A major chunk of these agritech start-ups have been working with farmers to reduce the wastage of produce by connecting them directly to hotels, restaurants and cafés where they can sell their produce through digital platforms. Greater funding and a push by the central government, will only encourage more farmers and producers in the agri-supply chain to use these e-platforms which would be profitable for both the farmer and the hotel chain.
In my opinion, the call for greater local production is not only going to be seen in India, but also countries and economies across the world who will take all steps to ensure that local production is at top as they strive to rebuild their respective economies and pick their domestic industries up from the ‘Covid Dust’.
Change 2: Lesser Global
With the abrupt closure of international borders and trade, it is going to be very tough, rather impossible to find your favourite smoked salmon on the breakfast buffet the next time you check into your star hotel.
A lot of imported food and beverages, ingredients which made their way to the kitchens and tables of five-star hotels and high-end restaurants are going to be in scarcity and may not be available for a significant amount of time until international borders completely open up and new government policy governing the import of such products actually kick in.
There are further factors at different levels which will only drive this change even further:
- Owing to the crippling blow that Covid-19 has had on the revenue of the hospitality industry – hotel chains, airlines, high-end restaurants and other key interlocutors across this segment will be looking to cut their costs especially those which are incurred by the ‘imported’ offerings made to their customers.
- Chefs across the spectrum are going to look at new and creative ways of bringing the similar and maybe new tastes with local produce to the palates of their consumers. A greater focus will be laid on sourcing locally grown and manufactured produce/product.
- At present with all means of transportation at national and international levels been used for the transport of essential food and supplies, it will be sometime before exporters are allowed to begin exporting their products to foreign markets.
- Remember the cost of transportation for the next two years or even more is going to be exceptionally high as interlocutors in the transport sector are going to look to make good on lost revenue. Going forward, international trade is going to bear the brunt of stricter import and export regulations. Governments across the world are going to be extremely cautious and cognizant on what is allowed across their borders and to the mouths and tables of their citizens and consumers.
It took Covid-19 to wake up, heal and repair the crippled and challenged cold chain and supply infrastructure across India. And we have not yet healed and repaired – we’ve still got a long way to go.
However, the present situation just exerted greater pressure on the government (Centre and states) and industry to ensure that all pieces of the agri-supply chain ranging from farm to fork, going forward will be well oiled, fully functional, adherent to the New Normal and are well plugged to ensure that India as a nation is self-reliant and is able to fall back on its own resources in such times.
As the Indian hospitality industry begins to model itself around the ‘new normal’ (which is here to stay for a very long time, if not forever), the agri-supply chain which constitutes close to 90 per cent of the hospitality, travel and tourism sector in India will be greatly and maybe solely driven by local players who will ensure timely and consistent delivery of locally grown and manufactured produce and product to its patrons. It is for us to adapt our palates to an entirely new locally grown and dished up avatar.