Business Opportunities in Agriculture: 150 Field Interviews (Book)

NSL to focus on R&D, inorganic growth via acquisitions

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Nuziveedu Seeds Ltd (NSL) is the largest hybrid seed producer in the country. It is the dominant player in cotton seed segment with a 25 per cent share of the Rs 3,500-crore market. It’s seeds are used by more than 5.5 million farmers. Recently, M Prabakar Rao, chairman and managing director of Nuziveedu Seeds, was elected president of the National Seed Association of India, which is represented by 238 seed companies including private and public sector companies as its members. Prabakar Rao talks to Sanjeev Sharma about the growth of hybrid seed industry in the country and how kharif sowing has crossed record levels thereby boosting the seed industry.

Q: What is the outlook on the domestic seed industry?

A: Domestic seed market has grown at 15-20% in the past two years, which is almost double the growth experienced by other countries. Development of new varieties of seeds in the country is low and also replacement of new varieties of seeds is low as compared to rest of the world. This will change as demand goes up. Worldwide, the seed industry is a $42 billion market. Top six countries, including India, control 67% of the global market.

In terms of crops, cotton seed market size is estimated to be nearly 23% that of the seed industry. Paddy seeds dominate the market in terms of the volumes with around 50% of the market followed by wheat with 37%.

With kharif sowing crossing record levels across the country, the season proves to be promising one for the seed industry as well. Area under kharif crops, including paddy and other foodgrains, has increased by over 17% to around 750 lakh hectare till the last week of July.

Q: Traditional food crop growing areas like Punjab and Haryana are moving to cash crops. What does this mean for your business model?

A: Punjab and Haryana are facing problems like over-exploitation of water resources forcing farmers to diversify into cash crops like maize. Nuziveedu Seeds has good presence in Punjab, Haryana and UP for cotton, varietal and hybrid paddy. Apart from these states, the company intends to increase participation in government subsidy programmes in states such as Bihar, Jharkhand and Odisha to market products to more farmers. The Indian Council of Agricultural Research has identified seven hybrid seeds developed by Nuziveedu Seeds for paddy, maize, sorghum and pearl millet, of which five are eligible for subsidies.

Q: Has NSL expanded its product portfolio in other crops such as paddy, maize and vegetables?

A: We are focusing on non-cotton seed segments like paddy, maize and vegetables. We have also developed hybrid seeds for vegetables such as tomatoes, chillies, okra and brinjals. We intend to continue to produce these high quality products at affordable prices in order to increase our market share. Sale of these crops today contributes more than 25% of the total seeds business.

Q: How big is NSL’s infrastructure and distribution network?

A: We own 16 processing plants which are spread in Andhra Pradesh, Maharashtra, Uttarakhand, Odisha and Gujarat. The processing centres have a combined processing capacity of 148 TPH (ton per hour) and an aggregate capacity to store 79,500 metric tonne of seeds.

Q: Recently NSL implemented a PPP model with Maharashtra government. How successful has been this model?

A: We engage in collaborative research activities with various government and international organisations. The Maharashtra government along with Nuziveedu Seeds took this initiative to increase per acre yield of cotton by employing innovative crop methods like high density planting and improved agronomic practices. The project is the largest in the country covering nearly 10,000 acres. More than 3,000 farmers from the region benefitted through this project. The results have been quite encouraging. The Maharashtra government has now evinced interest in extending the project to 20,000 acres this year covering seven districts.

See more at NSL to focus on R&D, inorganic growth via acquisitions | Nuziveeduseeds
 
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Business Opportunities in Agriculture: 150 Field Interviews (Book)

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