Food Ingredients Sao-1
Food Ingredients Sao-1
06 to 08 August 2013
Submitted by
&
Mr. Nareesh V S
Asst. Director (MKG)
Cochin -25
Food Ingredient South America : A platform for New Business in Latin America
Introduction:
Brazil is the largest national economy in Latin America the world's seventh largest economy at market
exchange rates and the seventh largest in purchaseing power pariety, according to the IMF and the
world Bank. Brazil has a mixed economy with abundant natural resources. The Brazilian economy
has been predicted to become one of the five largest in the world in the decades to come, the GDP
per capita following and growing, provided that large investments in productivity gains are made to
substitute the GDP growth of the last decade that is attributable to the increase in the number of
people working. Its current GDP (PPP) per capita is $10,200, putting Brazil in the 64th position
according to World Bank data. Active in agricultural, mining, manufacturing and service sectors
Brazil has a labor force of over a 107 million (ranking 6th worldwide) and unemployment of 6.2%
The country has been expanding its presence in international financial and , and is one of a group of
four emerging economies called the BRIC Countries. Major export products include aircraft,
electrical equipment. Automobiles, ethnol, textiles, footwear, iron, ore, steel, coffee, spices, orange
juice, soybeans and corned beef and has the fourth largest car market in the world. Adding aircraft
The climate of Brazil comprises a wide range of weather conditions across a large area and varied
topography, but most of the country is tropical. Brazil hosts five major climatic subtypes: equatorial,
tropical, semiarid, highland tropical, temperate and subtropical. The different climatic conditions
produce environments ranging from equatorial rainforests in the north and semiarid deserts in the
northeast, to temperate coniferous forests in the south and tropical savannas in central Brazil. Many
regions have starkly different microclimates. An equatorial climate characterizes much of northern
Brazil. There is no real dry season, but there are some variations in the period of the year when most
rain falls. Temperatures average 25 °C (77°F) with more significant temperature variation between
extensive as the Amazon basin but has a very different climate as it lies farther south at a higher
altitude. In the interior northeast, seasonal rainfall is even more extreme. The semiarid climatic region
generally receives less than 800 millimetres (31.5 in) of rain, most of which generally falls in a period
of three to five months of the year and occasionally less than this, creating long periods of drought.
Brazil's 1877–78 Great Drought, the most severe ever recorded in Brazil caused approximately half a
million deaths.The one from 1915 was devastating too. South of Bahia, near the coasts, and more
southerly most of the state of São Paulo, the distribution of rainfall changes, with rain falling
throughout the year. The south enjoys temperate conditions, with cool winters and average annual
temperatures not exceeding 18 °C (64.4°F); winter frosts are quite common, with occasional snowfal
Market Goals
The market goals are to develop the Brazilian market and achieve a dominant position in the market
as a reliable supplier.
Marketing Objectives
Increase the awareness of the consumer and companies about India spices and reach 10% of the
Strategy Recommendations
The spices board India must focus on global market (Brazil and Mercosul) expansion. This will require
In fact we have some alternative to do business in Brazil. We can develop and appoint importer or
distribution companies or also make a joint venture with a small Brazilian company which will permit
immediate results, although it will require financial investments. To set up a subsidiary company in
Brazil is the best alternative, instead of having a importer or distributor who may not be reliable. The
investments are lower than for a joint venture. For subsidiary company, a legal representative can be
nominated. Most of the implementation issues for Spices Board India relate to operating in culturally
diverse markets. This mean that the Indian company will have to identify with local markets and
Labelling
Product labels must contain inforamtion about the products quality, quantity , composition, price,
guarantee, shelf life, origin, labels should have a Portuguese translation and should use metric units
For the retailers the ideal packaging would be plastic packing or pet bottles / glass bottles and the
weight around 35 to 70 grams. For the food industry the idal packaging would be a bag and the
weight around 20 kg to 50 kg. The marketing promotion and pricing will depand on how the
company approaches Brazilian market. For each distribution channel-retailers, food company and
manufacturers of brand name products-we need a different marketing mix (product, distribution,
Distribution Channels
Retail: are companies who buy the spices and sell direct to the consumer such as supermarkets like
Wholesale / Distributor: are companies who buy in great quantity and sell only in boxes such as 24
units each to small stores, grocery stores, open air market etc. Example of distributor : Makro, Ciro,
Atacadao etc.
Food Service: are the restaurants, industrial kitchen companies who serve meal to employees in a
Industrial: are comapnies who buy the spices for preparing the food such as frozen food, seasoning,
salad dressings, snacks, tomatoes sauce, frozen meat storage plant and then these companies after
manufacturing the products sell to the supermarket and others retail channel.
CEASA: It is a huge market place where the local producers sell their product (fruit, spice, vegetable
etc) directly to the retailers. The companies work with different structure sales force to sell in each
channel.
Market Strategies
Target Market
Retailers such as Cia Brasileira de Distribuicao, Carrefour, Sonae, Bompreco, Casa Sendas,
Industrial – frozen food industry , salad dressings, snacks , tomatoes sauce, pastas, mayonnaise
Wholesale: Makro, Martins, Atacadao, Ciro, Peixoto, Vila Nova, Adriano, Sindi, Cofesa and
Others.
Supply for the brand name of the following retailers: Sonae, Bompreco, Casa Sendas, Wal
1. Last year the brand name products increase 34% in the supermarket.
2. There are 109 supermarkets who work with brand name products.
3. The food brand name product represents 49% of the total in the market
Fuchs-Gewurze, Kitano, Aurora, Hikari, Linguanotto, There are many other small companies.
Fuchs company is a subsidiary of the fuchs gewurze from Germany. The company sells their products
through three different channels retailers, food services and industrial sales. Because of the high quality
The company imports spices such as chilly peppers, nutmeg, coriander, cinnamon, cumin mainly
The biggest sales for fuchs is the industrial market , where it sells to frozen food industry,
The rtail market is also growing while the food services market is still relatively small. The company
has partners who produce pepper , paprika, onins, thyme and sage. In the retail market, their most
important products in plastic pouch packing are oregano, Onion-garlic parsley (mix) , and parsley,
and in PET bottle are nutmeg, curry, lemon pepper, pepper, garlic herbal spices.
Fuchs company gives the new client all the support in the market like samples, display catalogue ,
trainees etc. The others competitor companies also sell their products through the same distribution
channels.
Most of the supermarkets (carrefour, extra, se) have brand name products of Fuchs and sometimes of
its competitors.
Linguanotto company (American Subsidiary of Marks Inc) produces for the carrefour brand name and
also have their own products, which they sell to the retail channels through sales representatives.
Kitano, which is a name of the spice product from Yoki Company is the most popular spice. Ktano
Strengths
Reputaion for Indian Spices
Weaknesses
No distribution network
Market image
Opportunities
International expansion
Threats
Different culture
Consumer Behavior: Domestic meals- Increase in the consumption of frozen food, ready food,
Meals out of the house-increase of the consumption in the food service (restaurants, hotels and fast
foods)
Food Industries : Launching new products to get new market niche, increase the competitivity and
profitability . Launching new products to adopt the new trends of frozen food, ready meal market and
1. The organization in charge of regulating food imports in Brzil is the Ministry of Health. In
1998 the Brazilian National Health Vigilance Agency (ANVS), an agency similar to the U.S.
Food and Drug Administration, was created to help monitorfood devices. All foodstuffs must
2. The new resolution of the Brazilian national Health Vigilance Agency of March 23 rd 2000 lays
down that is not necessary to register all the food products imported or sold in Brazil, althogh
it is necessary to apply for technical exemption from registration (dispensa) to obtain the
authorization to import. This has made it easier to exprot spices or seasoning to Brazil.
3. Spice cultivation in Brazil is poor and is not enough to supply the local market demand. Brazil
produces clove, pepper, ginger and imports cinnamon, oregano, cumin, nutmeg, Aniseed ,
rosemari etc.
4. Brazil is a huge country with different cultural backgrounds in different regions. In hte
northeast people consume cumin, coriander, cinnamon, clove but in South they consume
more nutmeg, oregano, curry spices, etc. Sao Paulo in the southeast is the biggest market and
5. The distribution channels are retailers, food service and industrial. The companies work with
UBM (United Business Media) Live is a division of UBM Plc., which is headquartered in London,
UK. The office in the Netherlands is the organiser of the world leading FI, Hi, Cphi and series of
Pharmaceutical and food ingredients trade shows. Food Incredients South America (FISA) and Health
Ingredients South America (HISA) 2013 was held in Sao Paulo (Brazil) from 6 th – 8th August 2013 at
Latin America is a vast and varied region, boasting incredible landscapes, history and cultures. The
region has seen major developments in terms of economics climate and consumer behaviour. Rising
incomes , social changes and growing populations have boosted the region's economy reinforcing
Brazil features wonderful hospitality and a remarkable economic performance, making Sao Paulo an
excellent platform for new product development in the region. Demand for processed foods,
functional foods, healthy eating and market expertise remains high and Fi & Hi South America
The exhibition brought together professionals in the areas of purchasing, Research & Development,
Marketing, Sales, Quality Control, Regulatory affairs among others. The high qualified public could
enter in contact with over 500 brands presented to the market by exhibiting companies having access
The Quest for healthiness was the main trend printed in consonance with the approach of the two
largest industries in Brazil, food, and pharmaceutical development of new products. During the three
day event topics such as weight management, marketing management, cardiovascular and bone
health, reducing salt and sugar, the concept of beauty from the inside out and anti aging products
stood out. With great repercussion among those present, the presentations and discussions in the
seminar sessions were successful, bringing together professionals during the fair and increasing the
visibility of companies and brands. The media was present at the event. With total interest in bringing
news from the food industry to market, more than 23 different types of media were present in search
The Board stall had set up a pavilion of 25 sq. mtrs and stand no is R 29 in Sao Paulo, Expo Center
Norte, Brazil organized by Food Ingredients South America (FISA) and Health Ingredients South
America (HISA) 2013 during 6 to 8 August 2013. Exhibition timing was 1.00 pm to 8.00 pm. The
exhibition centre offered all modern facilities business centre, parking, round the clock security, press
& media rooms, information centre, toilets, warehouse and restaurants. The stall Food ingredients
portfolio of products that allows our company to directly access local and international food ingredient
FISA, Sao Paulo this year witnessed unprecedented participation of the Spice importers/traders/
brokers from Latin America. Mr. Murtuza Badami, Murtuza Foods Pvt., Ltd. Umaniyawadar,
Mahuva, Gujarat, participated in our Spices Board stall. Business visitors are from various countries
from Colombia, China, Australia, UAE, Thailand, Peru, Chile, Indonesia, New York and Brazil.
Spices Board officials interacted with the visitors. It was evident during the discussions that the
importers were pressing for quality products. They were happy and satisfied by the Indian spices
samples.
The eye-catching display of spices samples, both whole and value added products drew crowds
towards our stand. The trade enquiries were mainly for cardamom, white pepper, Pepper Powder,
turmeric, curry powder, Herbal spices, thyme, chilly, nutmeg and value added products. Many
business class visitors interacted with the Board officials and showed their interest in importing Indian
Accessed local and international industry professionals with huge purchasing power and discussed their
needs. Meet face to face with the customers to identify their needs and bolster long term relationships.
Network with business professionals from around the world food ingredients community.
The type of response by the traders definitely gives the feeling that Brazil prefers Indian spices. There
is much scope for export of garlic, cardamom and other spices to Brazil, which form the main hub in
Brazil entered the field of commercial pepper cultivation in 1933 when a group of Japanese
immigrants started pepper cultivation on a large scale. There was remarkable success and Brazil
became one of the major pepper producing countries and started exports to the nearby market of
U.S.A. Currently pepper is grown in Paraiba, Espirito Santo ans Ceara in the state of Para where the
pepper estates are owned by the members of the co-operative Agricola Mista ( Mixed agricultural
Co-operative) and in the area of Belem the pepper gardens are owned by individuals. The average
area of pepper cultivation in Brazil is 28.050 hectares and the annual production is 26.393 tonnes.
Brazil is a major exporter of pepper, exporting about $ 77m in 2012 which amounted to just under
half of its total spice exports. Brazil is also emerging as a large exporter of other types of spices,
including varieties from the capsicum family which currently account for $46m of its total spice
exports. Brazil has enjoyed growth rates of over 38% per annum since 2000. While the majority of
Brazilian spices were sold in the US markets in the past, the country has recently started to target the
German market.
Food Ingredients South America fair helped to complete the information about the degree of interest
and opportunities present in Brazil in terms of natural ingredients. It is very important to study the
Brazilian market to get ready to acres this market with a successful and durable strategy. Certifications,
regulations and taxes and additional costs such as internal transportation are among the most
important factors that should be taken into account in relation to this market; service providers are a
useful option in order to get useful information in these relevant topics. Some business advices have
been collected from the experience of different stakeholders in the Brazilian market. The most
1. When a new company begins negotiation with a Brazilian businessman, he will hardly say a
directly “no” in any aspect so this should be taken into account to avoid disappointments.
2. Be patient: there is a need to be patient with Brazilian customers or partners, as they will make
decisions taking their time. It is also needed to be patient with the administration and
paperwork which is usually slower and more complicated than other countries.
3. Do not abandon your customer or Brazilian partner. Brazilian businessmen prefer long term
cooperation so it s preferable that the foreign company really intends to maintain its presence
4. Expect the “Brazil cost” . Take for example the tax system cascading to be taken into account
when determining your rates offer and although Brazilians like new products, do not act
underr the often wrong idea that anything from other countries is new in Brazil.
Brazil is importing many value added spices like Chilli, Turmeric, Cumin, Celery, Fennel,
Fenugreek, Nutmeg and mace, Mint, spices oils and other spices products from India. The Board's
stall witnessed a large turnout of visitors including importers, exporters, hoteliers and consumers
definitely give the feeling that Brazilian prefers Indian Spices. We recommend that there is much
scope for export of cardamom, Chilli, Chilli powder, turmeric, cumin, Nutmeg and Mace, Mint and
other spices to Brazil, which form the main hub in spices trade among Latin America.
Foreign Trade Enquiries Received at Food Ingredient South America, Sao Paulo 2013
during 6.8.2013 to 08.08.2013