nks fertiliser mktg.,port operation&tpt 5-1-2011
TRANSCRIPT
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MARKETING AND
TRANSPORTATION OF IFFCOFERTILISERS
N.K.SALHOTRACHIEF MANAGER (Mktg.)
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SALIENT FEATURES : INDIA
Agriculture continues to be the mainstayof Indias economy.
Agriculture Contribution to GDP is 16%.
Two Third of population lives in thevillages.
57% of population depends onAgriculture Sector.
With growing population, land man ratiois declining.
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2007-08 : 114 crore
2008-09 : 116 crore2009-10 : 118 crore2010-11 : 121 crore2011-12 : 123 crore
2006-07 : 217.3 mill te.
2007-08 : 230.8 mill te.
2008-09 : 234.5 mill te.2009-10 : 218.2 mill te.2010-11 : 244..8 mill te2011-12 : 250.0 mill te.
POPULATION ( Number)
FOODGRAIN PRODUCTION
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2006-07 : 217 Lakh te.2007-08 : 226 Lakh te2008-09 : 249 Lakh te2009-10 : 265 Lakh te2010-11 : 281 Lakh te2011-12 : 290 Lakh te.
With growing population, land man ratio is declining. Chances of bringing additional land under Cultivation are remote.
Future increase in agricultural production has to come by way ofincreasing productivity of land already under cultivation.
FERTILISER CONSUMPTION (N+P+K)
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SALIENT FEATURE : INDIA(Contd..)
Future increase in agricultural productionhas to come by way of increasingproductivity of land already under cultivation.
Vital role of fertilizers for increasingagricultural productivity is universallyrecognised.
Share of fertilizers for increasing foodgrain
production is 50%.
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SALIENT FEATURES : INDIA
Geographical Area : 329 mill ha.
Number of Villages : 6 lakh
Agricultural Holding : 120 million
Small & Marginal Farmers < 2ha : 81 %
Farmers Having Land < 2ha : 39 %
Net cropped Area : 141 mill ha.
Gross Cropped Area : 196mill ha.
Cropping Intensity : 139
Gross Irrigated Area : 87 mill. Ha
Share of Gross Irri. Area : 45%
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FERTILISER PRICING - INDIA
Presently, urea is under control and assuch its production, distribution and pricesare controlled by GOI.
Phosphatic and Potassic fertilisers havebeen decontrolled w.e.f. 25th August,92.
GOI is giving fixed subsidy on Phosphaticand Potassic fertilisers and manufacturershave the freedom to fix prices of thesefertilisers.
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YEAR Fertiliser Cons. (000 te) Annual Growth Rate over
previous Period (%)N P K TOTAL N P K TOTAL
1951-52 59 7 0 66
1971-72 1798 558 301 2657 21.8 24.9 26.5 22.9
1991-92 8046 3321 1361 12728 7.1 9.7 7.3 7.7
1992-93 8427 2844 884 12155 4.7 -14.4 -35.0 -4.5
2002-03 10474 4019 1601 16094 2.8 4.1 7.3 3.5
2004-05 11714 4624 2061 18398 5.7 7.3 13.5 6.9
2005-06 12723 5204 2413 20340 8.6 12.5 17.1 10.6
2006-07 13773 5543 2335 21651 8.3 6.5 -3.3 6.4
2007-08 14419 5515 2636 22570 4.7 -0.5 12.9 4.2
2008-09 15090 6506 3313 24909 4.7 18.0 25.7 10.4
2009-10 15580 7274 3632 26486 3.2 11.8 9.6 6.3
FERTILISER CONSUMPTION IN INDIA
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CONSUMPTION (Kg./ha) Consumption RatioYEAR
N P K TOTAL N P K
1951-52 0.4 0.1 0.1 0.5 7.9 0.9 1.0
1971-72 10.9 3.4 1.8 16.1 6.0 1.9 1.0
1991-92 44.2 18.2 7.5 69.8 5.9 2.4 1.0
1992-93 45.4 15.3 4.8 65.5 9.5 3.2 1.0
2002-03 55.1 21.1 8.4 84.6 6.5 2.5 1.0
2004-05 61.6 24.3 10.8 96.7 5.7 2.2 1.0
2005-06 66.0 27.0 12.5 105.5 5.3 2.2 1.0
2006-07 71.1 28.6 12.1 111.8 5.9 2.4 1.0
2007-08 73.6 28.2 13.5 115.3 5.5 2.1 1.0
2008-09 77.1 33.2 16.9 127.2 4.6 2.0 1.0
2009-10 79.6 37.1 18.5 135.2 4.3 2.0 1.0
PER HECTARE CONS. IN INDIA
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ALL INDIA PRODUCTION, CONSUMPTION,
GAP & IMPORTUREA
YEAR CONS. PROD. GAP IMP.
2000-01 192 196 -4 -
2001-02 199 190 9 2.2
2002-03 185 186 -1 1.22003-04 197 190 7 1.4
2004-05 207 202 5 6.4
2005-06 223 201 22 20.6
2006-07 243 203 40 47.2
2007-08 260 199 61 69.3
2008-09 266 199 67 56.7
2009-10 267 211 56 52.1
LAKH MT
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ALL INDIA PRODUCTION, CONSUMPTION,
GAP & IMPORTDAP
YEAR CONS. PROD. GAP IMP.2000-01 59 49 10 8.6
2001-02 62 51 11 9.3
2002-03 55 53 2 3.82003-04 56 47 9 7.3
2004-05 63 52 11 6.4
2005-06 68 46 22 24
2006-07 74 47 27 29
2007-08 75 42 33 27
2008-09 92 30 62 62
2009-10 105 42 63 59
Lakh MT
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ALL INDIA PRODUCTION, CONSUMPTION,GAP & IMPORTMOP
YEAR IMPORTS CONSUMPTION2000-01 26.5 18.3
2001-02 28.1 20.0
2002-03 26.0 19.1
2003-04 25.8 18.4
2004-05 34.1 24.1
2005-06 45.8 27.3
2006-07 34.5 25.9
2007-08 44.2 28.8
2008-09 56.7 40.8
2009-10 52.9 46.3
Lakh MT
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Plants LocationYear of
ProductionExpand
ed in
Annual Production
Capacity(in Lakh MT)
Kalol Gujarat 1975 1997 Urea 5.45
Phulpur U.P. 1981 1997 Urea 14.16
Aonla U.P. 1988 1996 Urea 17.29
Kandla Gujarat 19751981 &1999
DAP/NPK(in bulk) 24.15
Paradeep OrissaAcquired inSept 2005
- DAP/NPK 19.2
IFFCO PLANTS
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IFFCOs PRODUCTS
KANDLA NPK 10:26:26 ( GR-I )NPK 12: 32:16 ( GRII )
DAP 18: 46 : 00
Urea Phos. 17: 44 : 0
PARADEEP
KALOL
NPK 10: 26: 26NPK 20:20:0:13
DAP
UREA
PHULPURI & II UREA
AONLAI & II UREA
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27.17
37.18
64.35
32.26
37.86
70.12
28.84
39.63
68.47
31
40.68
71.68
38.74
43.24
81.98
41.79
44.02
85.81
2005-06 2006-07 2007-08 2008-09 2009-10 2010-11
COMPLEX UREA TOTAL
IFFCO PRODUCTWISE PRODUCTION
PERFORMANCE
(Lakh MT)
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SHARE OF COOPERATIVES IN
FERTILISER PRODUCTION
(000 Tonnes)
ITEM 2008-2009
N P2O5
2009-2010
N P2O5
ALL-INDIA 10900 3417 11924 4374
IFFCO 2329 918 2585 1194
OTHERS
COOP.
802 - 819 -
TOTAL COOP. 3131 918 3404 1194
IFFCO (%) 21.4 26.9 21.7 27.5
COOP. (%) 28.7 26.9 28.5 27.5
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GROWTH IN PRODUCTION CAPACITIES
(in lakh MT)
3.96
8.91 8.91
16.17
23.4324.91
32.18 32.18
36.89 36.89 36.89 36.89
42.42
4.16 4.16
8.81 8.81 8.81
21.91
24.15
43.35
43.35
4.16
8.81
19.74
8.81
16.00
0
5
10
15
20
25
30
35
40
45
50
Jan.'75
Apr.'75
Mar.'81
Sep.'81
Jul.'88
Dec.'96
Aug.'97
Dec.'97
Aug.'99
Apr.'01
Apr.'02
Apr.'04
Oct'05
Dec'08
Urea
NPK/DAP
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DEFINITION OF MARKETING
MARKETING IS THE PROCESS OF PRODUCTION ANDEXCHANGE THAT IS CONCERNED WITH FLOW OF
GOODS AND SERVICES FROM PRODUCERS TO
CONSUMERS.
IN POPULAR USAGE, IT IS DEFINED AS DISTRIBUTION
AND SALE OF GOODS. HOWEVER, SELLING IS ONLY
THE TIP OF THE MARKETING ICEBERG.
SOME DEFINED IT AS THE COMMERCIAL FUNCTIONINVOLVED IN TRANSFERRING GOODS FROM
PRODUCER TO CONSUMER.
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AS PER PHILIPS KOTLER
Marketing is defined as a task of creating,promoting, and delivering goods & services to theconsumers and business.
Also marketing deals with identifying and meetinghuman and social needs.
Meeting needs profitably.
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DEFINITION OF MARKETING
INBROADER SENSEMARKETING INCLUDES THE ACTIVITES OFALL THOSE ENGAGED IN THE TRANSFER OFGOODS FROM PRODUCER TO CONSUMER i.e.
NOT ONLY THOSE WHO BUY AND SELLDIRECTLY, WHOLESALE AND RETAIL, BUT ALLTHOSE WHO DEVELOP, WAREHOUSE,TRANSPORT, INSURE, FINANCE, ORPROMOTE THE PRODUCT, OTHERWISE HAVEA HAND IN THE PROCESS OF TRANSFER.
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SET-UP OF IFFCO MARKETING DIVISION
MARKETING DIVISION IS HEADED BYMARKETING DIRECTOR.
SUPPORTED BY SR. EXEC. DIR. (TPTN),GMs/ Jt. GMs IN VARIOUS DISCIPLINES ATMKCO.
THERE ARE DISTN., TPTN, MKTG. SEVICES,AGRI. SERVICES, MKTG. ACCOUNTS,HANDLING & TPTN, P&A, COMMERCIAL,PUBLIC RELAION, TRAINING AND SYSTEM
DEPARTMENTS.
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SET-UP OF MARKETING DIVISION
IFFCO IS OPERATING IN 29 STATES & UTs. TOTAL MARKETING AREA HAS BEEN DIVIDED INTO 5
ZONES NAMELY: NORTH - PUNJAB, HARYANA, RAJ., J&K,H.P.
WEST - GUJARAT, M.P., MAH, CHHATISGARH NORTHCENTRAL U.P., UTTARANCHAL,
BIHAR & JHARKAHND EAST - WEST BENGAL, ASSAM & ORISSA SOUTH - A.P., KAR., TAMIL NADU & KERALA
EACH STATE IS HEADED BY STATE MARKETINGMANAGER SUPPORTED BY ACCOUNTS, P&A,SYSTEM AND AGRI. SERVICES, HANDLING & TPTNAND PUBLIC RELATION DEPTTS.
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SET-UP OF IFFCO MARKETING DIVISION
EACH STATE HAS BEEN DIVIDED INTONUMBER OF AREA OFFICES RANGINGFROM 1 TO 12 DEPENDING UPON THE
POTENTIAL AS WELL AS MKTG. TERRITORY
STATES OF H.P., J&K, JHARKHAND, ASSAMAND KERALA HAVE NO AREA OFFICES.
U.P. STATE HAVE 12 AREA OFFICES.
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SET-UP OF IFFCO MARKETING DIVISION
AREA OFFICE IS HEADED BY AREA MANAGER &SUPPORTED BY DY. AREA MANAGER/ FIELDOFFICERS & OTHER RELATED STAFF.
NUMBER OF FIELD OFFICERS DEPENDS UPONTHE POTENTIAL OF THE AREA.
IN SOME DISTRICTS, THERE MAY BE TWO ORMORE FIELD OFFICERS.
A FIELD OFFICERS MAY BE LOOKING TWO ORMORE DISTRICTS ALSO.
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5389
633557645869 5492
6823
60546464
8191
8610
9323
1125811827
12587
23522794
3181 336938943702 3670
5010 52415429
1500
2500
35004500
5500
6500
7500
8500
9500
10500
11500
12500
13500
2003-04 2004-05 2005-06 2006-07 2007-08 2008-09 2009-10 2010-11
COMPLEX UREA TOTAL
IFFCO SALES PERFORMANCE(000 MT)
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IFFCO & INDUSTRY SALES
YEAR UREA NPK DAP/MAP TOTAL
IFFCO
YEAR 2008-09 5869 2447 2942 11258
YEAR 2009-10 6335 2795 2697 11827
INDUSTRY
YEAR 2008-09 26651 7122 9903 43676
YEAR 2009-10 26448 8203 10392 45043
IFFCO SHARE IN INDUSTRY( % )
YEAR 2008-09 22 34 30 25.8
YEAR 2009-10 24 34 26 26.3
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MANUFACTURER-WISE RANKING IN SALES
( ) PER CENT SHARE
2009-10Rank UREA DAP* NPK
I IFFCO (24) IPL(29) IFFCO (35)
II NFL (13) IFFCO(26) CFL (24)
III KRIBHCO (11) GSFC (9) FACT (9)
IV RCF (11) PPL (9) RCF (6)
V NFCL (8) CFL (6) ZIL (5)
*Including MAP & TSP
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MARKETING CHANNEL
Every manufacturer need a link with thecustomers to sell his products.
The set of intermediates forming this
important link is called themarketing/distribution channel.
Selecting the right channel is the most
important, complex and challenging task forevery business organisation.
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MARKETING CHANNELMarketing Channel in India for Fertilisers can
broadly classified into three categories :
Institutional Agencies
Private Trade
Company owned outletsPrivate trade accounts for 60%.
Institutional agencies including cooperativesaccounts for 35%.
Manufacturers own 5%
As a matter of Policy, IFFCO is channelisingits products thru the Cooperative Channels.
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Cooperative Channels
State Level Federations : 29 District Level Mktg. Soc. : 171
PACS : 86,500
Dealing in Fert. : 41,650 Primary Agricultural Cooperative Societies
(PACS) are the backbone of the coop. mktg.System.
PACS are well spread and cover about 97%of the villages and 95% of the farmingfamilies.
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FERTILISER SALEPOINTSIN INDIA AS ON 31.3.2010
Total Salepoints - 276,313
Private - 215,666 (78%)
Instit. Agencies - 60,647 (22%)
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CHANNEL-WISE DISTRIBUTION OF IFFCO FERTILISERS
IFFCO PLANT
APEX MKT.FEDERATION
Distt./Block
Level Mktg.
Societies
Distt./Block Level
Societies
Village Level Coop
Mktg. Soc. (PACS)
FARMERS
Institutional
Agencies
RETAIL
OUTLETS
FARMERS
SERVICE
CENTRES
32% 60% 4% 4%
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Distribution of fertilisers mainly through the Cooperative
System:
State level Apex Cooperative Marketing Federation
acts as wholesaler
Direct supplies to Societies in some States
IFFCO-NCDC Cooperative Societies
Small quantities to institutional agencies like AgroIndustries Corporation etc
158 IFFCO Farmers Service Centres
MARKETING CHANNELS
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COOPERATIVE STRUCTURE Coop. Structure differs from state to state and
societies at different levels (district/ taluka/village) perform different functions in differentstates.
Generally, the coop. network operates through
a 3 tier system. However, in some statessuch as Haryana, the coop. marketing systemoperate on 2 tier basis, while in some otherslike Gujarat a 3 tier system exists.
At the State Level, Apex CooperativeMarketing Federations act as wholesalers;Marketing Societies at district/taluka level asSub-Wholesalers while PACS, PAMS at grass
root level act as Retailers.
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FARMER SERVICE CENTRES (FSC)
The basic idea of opening FSCs is to provideall inputs under one roof i.e. fertilisers,seeds, agro-chemicals etc.
These Centres also provide technical know-how to the farmers.
At present, there are about 158 FSCs.
The total sales thru FSCs during 2009-10was 5.49 lakh MT ( 4.7% of total sale )with turnover of Rs. 377 crore.
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FERTILISER DISTRIBUTION Fertilisers are produced at 139 locations in the country.
Volume of fertiliser ( indigenous and imported) despatchedin the country during 2009-10 was 53 million MT.
Volume of IFFCO fertilisers despatched during 2009-10was 11.77 million MT(22 % of Industry).
Av. Daily despatch of IFFCO is 15 Rakes.
Distribution of above quantities to the Farmers scatteredin about 6 lakh villages in the country is a Herculean Task.
Fertiliser is further scattered in each nook & Corner of theField.
This is more so due to the fact that fertiliser production isa continuous process whereas consumption is highlyseasonal and confined to 3-4 months in a year and thattoo split into two seasons namely Kharif and Rabi.
Fertiliser being a bulk commodity, its logistics is complexactivity.
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TRANSPORTATION Fertilisers are moved by Rail (73%) & Road
(27%) only. IFFCO RAIL share is 90%. Rail transport is suited for larger volume and
economical for longer distances.
Fertiliser Movement is done by rakes only i.e. BG
Rake - 2500 to 2700 MT for covered wagons andupto 3000 MT for open wagons & MG rake -700
to 800MT
Number of Fertiliser rakepoint : 730out of which used by the Industry is 400-500.
Coastal Movement share is negligible. However,IFFCO has despatched some quantity fromParadeep unit thru coastal movement .
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WAREHOUSING
Warehousing is essential as consumption offert. is highly seasonal.
IFFCO utilizes the services of Central/ State
Warehousing Corporations and CooperativesGodown.
CWC/SWCs Godown are hired mostly at the
Rakepoint.Cooperative Godowns are located mostly atVillage Level.
STORAGE SPACE RESERVED BY
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Agency No ofWarehouses
Space(MT/ Month)
CWC 63 77000 (9%)
SWC 141 162000 (19%)
COOPERATIVES 2180 607000 (72%)
TOTAL 2384 702200
STORAGE SPACE RESERVED BYIFFCO 2009-10
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IMPORT OF FERTILISERS BY IFFCO
IFFCO is handling three types of import:
OMIFCO Urea ( H&T at Port Rs. 939 per tonne).
Imported Urea on GOI A/c
New Mangalore - Rs. 983 per tonne
Pipavav - Rs. 1063 per tonne
Kakindada Deep Water - Rs. 891 per tonne
Krishnapatnam - Rs. 870 per tonne
Plus Transportation as per Statewise per tonne Rates
Imported DAP
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PORTS UNDER OPERATION
1. KANDLA
2. MUNDRA
3. PIPAVAV
4. NEW MANGLORE5. KAKINADA DEEP WATER PORT
6. KRISHNAPATNAM
7. VIZAG
8. TUTICORIN
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IMPORTS BY IFFCO
PRODUCT 2006-07 2007-08 2008-09 2009-10 2010-11
UREA 13.65 15.12 17.36 20.52 24.51
DAP/MAP 7.16 2.19 21.83 15.88 16.11
TOTAL 20.81 17.31 39.19 36.40 40.62
Lakh Tonne
* Including 1.36 lakh MT imported NPK
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DISCHARGE OPERATION
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DISCHARGE OPERATION
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Loading into Trucks
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Bagging & Weighment
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THANK YOU