Food inflation remains a cause for concern, and while the current situation is stable, Suresh Narayanan, chairman and managing director of Nestlé India, emphasised the need to closely monitor it.
Narayanan pointed out that the current almost 30 per cent monsoon deficit and the yet-to-fully-develop El Ni？o effect could influence demand.
“Although it may sound speculative, the rural sector’s substantial impact could lead to a corresponding decline in rural demand,” said Narayanan.
The rural sector accounts for 20 per cent of Nestlé India’s total demand.
“However, at this point, I would put it in the realm of crystal gazing. The full ramifications of the monsoon shortfall are yet to be absorbed, as expectations are for some improvement in September. If this happens, we will be in the sunshine once more,” he further remarked.
Narayanan noted that demand remains relatively stable and robust, even in Tier-2 to Tier-6 towns. He added, “We can anticipate a promising festival season.”
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Speaking with Business Standard on the sidelines, Narayanan said that milk prices could see a dilution due to the upcoming flush season.
These statements were made during the launch of a+ Masala Millet. Nestlé, known for its 2-minute Maggi noodles, is expanding its ready-to-eat line by introducing bajra-based millet snacks under the Rs 100 crore a+ brand, along with the Indian Institute of Millets Research.
“The growth of the millet category will take time and will not immediately unlock a new opportunity for us. However, Generation Z is highly conscious about its food choices, which gives me hope for this product,” Narayanan expressed.
Innovation, he added, currently contributes around 5 per cent of total sales.
The company started its millet journey with the introduction of the ragi variant of Ceregrow, its baby food brand. Additionally, it offers a jowar variant of the cereal brand Koko Krunch and a millet-based version of the cold malt beverage Milo.
Looking ahead, Narayanan outlined plans to incorporate millets across Nestlé’s product portfolio, including the possibility of introducing millets in various forms to Maggi.
He stated, “Millets, in some avatar, will come to Maggi and encompass a significant part of the company’s nutritional thrust.”