The presence of major probiotics suppliers and product makers such as Danisco, Chr Hansen, Yakult and Danone is accelerating growth in probiotic dairy products which remain in their infancy.
The Indian market remains minute by European standards with F&S estimating its worth at a mere 20.6m Indian rupees (€320,000), but it should push through the €1m mark around 2013-2014 and be worth €1.3m in 2015.
With India’s urban middle class growing rapidly it is easy to see why there is so much interest in a country with a population approaching 1.2bn.
But the public education program required so that consumers are able to make the link between consuming probiotic products such as yoghurts, drinks and supplements, has a long way to go.
In contrast to many other markets, the major format for probiotic sales in India to date has been food supplements, rather than the most popular formats – spoonable and drinkable yoghurts.
Probiotic supplements account for 49 per cent of sales with foods and beverages at only four per cent. Globally, food and beverages account for 56 per cent of probiotic sales.
Yakult Danone India
The 2009 entry of the two biggest probiotics players in the world – Danone and Yakult – in a joint venture is sure to have something to say about that status quo. Yakult Danone India has since September been targeting major Indian metropolises like Mumbai and New Delhi with an army of ‘Yakult ladies’ taking products to the people door-to-door.
Extolling the gut health and immunity benefits of the products is part of this putsch.
"Though the market for probiotic foods in India is still at a nascent stage, as pioneers and global leaders in this category we will play a major role in developing the probiotics food market in India,” said Yakult Danone India’s Kiyoshi Oike in September, 2009.
An Indian manufacturing facility has also been established.
In its report, F&S said the only major Indian player was NDRI Karnal, which has been in the practice of supplying Indian dairies with cultures, but not in a nutritive sense.
“NDRI Karnal is presently conducting research in the field of probiotics and prebiotics and are expected to come up with improved variants and strains of probiotics with better shelf life in the near future,” the report states, noting other local dairies are expected to come onboard.
Challenges
F&S noted some of the difficulties western companies had faced in getting established in India.
“Multinational companies have found the Indian market very challenging in the past owing to supply shortages, poor cold chain, storage facilities, poor infrastructure, and underdeveloped and complicated distribution channels,” it said.
“Performance in the food and beverage probiotic market is still dominated by issues in strain stability, low shelf life of products, and the development of probiotic application technology.”
Estimates put the global probiotic foods and drinks market at about €10bn.