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Enhancing Competitiveness through Higher ProductivityFruit & Vegetable Sector in Sri Lanka:

THE HAYLEYS AGRICULTURE EXPERIENCEKEY FACTSBio-diversity of Sri Lanka offers tremendous opportunities for producing a range of fruits & vegetablesRegional markets have grown over the past decade (Maldives, the Middle East)Enormous opportunities for processed fruits & vegetables in Europe & AsiaGlobalization Year round supply of fresh & processed agri products sustained demandEstablishment of globally-linked supply chainsQuality and Innovation gaining groundSteady growth in exports from US 36 mn in 2011 to US 45 mn in 2012

PRODUCTIVITY ENHANCEMENTAccess to and application of latest growing and processing technologiesCo-ordinated supply chains result in high value-added productsFocussed R&D to drive innovation and product developmentStrengthening partnerships along the supply chainAgricultural extension servicesCost management & improved margins

The OpportunitiesDemand for organic, exotic, fair-trade & ready-to-eat productsValue added processed fruit and vegetable productsAccess to insights into changing consumer demandsStandardization & accreditationsGlobal forums and trade fairs

Account for 43% of Sri Lankas total fruit and vegetable exports and suppliers to McDonalds, Burger King, Hungry Jacks, Subway, 7-Eleven , Heinz , Unilever and Nestle.Involved in large scale cultivation via outgrowers of gherkins and other fruits & vegetables such as chillies, bell peppers, jalapeno peppers, Spanish peppers, pineapple etc for the export market Second largest gherkin exporter in Asia, processing 12,000 MT per annum and holds 62% share of the Japanese market for bottled picklesSupplier of exotic processed fruits & vegetable to global private labels

HAYLEYS AGRICULTUREThe Sri Lanka ExperienceProcessed fruit & vegetable supply chainGherkins in brine in bulkValue-added pickles in retail forms

Nucleus FarmOut-grower SystemImproving Quality of Farm Produce &Processing Techniques SUNFROST LIMITED The Supply Chain1980s Pickled Gherkins in bulkIdentified suitable seed varieties

Developed other growing techniques

Training of extension and processing staff Maximizing Profit + Helping Farming Community

Buyback & Price guaranteedMarket, Product & Process Information Farmer Inputs on Credit Technology Transfer Presence in Remote VillagesR&D in Farming & Processing

Capacity buildingatFARMER LEVELNew Product Development How the Linkage was provided . The Supply Chain

A Supply Chain pulled by Buyer Planting program to meet market/customer needs Weekly payments through Farmer Bank Accounts Farmer awareness of their position in the supply chain Discuss market trends at Farmer Training ClassesBuyback & Price guaranteedMarket Information Increased flexibility

Field Extension staff - Agric. Graduates & Diploma Holders Extension staff trained by Experts from Dept. of Agric., Universities, Factory staff Farmer Training Training Classes On farm training during regular farm visits

Seeds, Fertilizers on Credit Quality and correct dosage of Inputs Traceability & Timely use Easy & reliable source of Credit to Farmers No security on Credit, Settlement once harvest is delivered

Farmer Inputs on CreditTechnology Transfer

New products to add value to local Fruits & Vegetables Products that are popular in the market, new to local growers On farm Productivity & Quality improvements Effectiveness and efficiency of Inputs use (Seeds, Fertilizer, Pesticides) Labor efficiency Post harvest handling Improving Quality of Farmer Produce

Upgrading Manufacturing Process Best Management Practices: 5S, QCC, Kaizen, Lean Manufacturing Cost Effectiveness Quality of Finished Product

New Product DevelopmentR&D in Farming & Food Processing

The Supply Chain

Mid-1990s - Value-added pickles in retail form HJS CONDIMENTS LIMITEDFocus on Finished ProductDiversification adding value to wide range of fruits & vegetablesMarket Links with Distributors,Food Wholesalers, Food Retailers, Food Manufacturers

New Product Development

Accreditations: HACCP / ISO 22000ISO 9001 - 2000 ISO 14000OHSAS, BRCImproved Product Quality

LINKAGESHow the supply chain activities are linked (Growers, suppliers, manufacturers, distributors, and customers) The LinkageInputs

Grower/SupplierTransformation

Manufacturer /ProcessorDistribution

DistributorOutput

CustomersGlobal MarketLocal Farmers

HJS

Sunfrost

Key Global Partners

CONSTANT MARKET FOCUSVALUE ADDITION & PRODUCT DEVELOPMENTINNOVATIONEMPHASIS ON TOTAL QUALITYSUSTAINABLE SUPPLY CHAINKEY LEARNINGS