Indian spices have always been in demand due to their aroma, texture, color, and medicinal properties. The country is a major producer and exporter of spices. Out of the 109 different types of spices listed under the International Organization for Standardization (ISO), India is known to produce as many as 75 varieties. Some of the spices that are majorly exported from India include turmeric, pepper, cardamom, cumin, coriander, vanilla, and tamarind.
Indian spices export and key market segments
- India exported spices worth US$ 3.62 billion in the FY20.
- US, UAE, UK, Hong Kong, Australia, and Canada were the top importers of Indian spices in the FY21.
- The Indian spice market grew at a CAGR of 15% during 2015-2020. According to market analysts, this strong growth is expected to continue during the 2021-2027 period.
- The market for branded spices in India is set to double and reach around ₹50,000 crores by 2025, according to a recent study.
- Around 5200 tons of organic spices were exported in the FY21 to different destinations. Some of the major countries where organic condiments from India are exported include the USA, Germany, France, UK, Australia, Belgium, Netherlands, and Switzerland.
Scope of spice export business in India
The market for Indian spices has experienced massive growth across the world because of more people experimenting with new cuisines that use spices. The other drivers for this market segment are the increase in disposable incomes and the rise of the urban population willing to eat in restaurants and experience new food ideas. The growing use of frozen and packaged food where spices are used for preservation and to make the food products more appealing has also contributed significantly to the overall market growth.
Want to export spices? Start with selecting the specific business type
To start an export business in spices, the first step would be to select the type of business you would want to engage in. You could be a manufacturer growing spices for export or a merchant exporting spices.
Take care of logistics and focus on a specific condiment
The next step would be to select your warehouses and other facilities well connected to transportation routes with access to electricity, water, and other basic necessities of the business. Next, you would need to select the spices you would want to export. For instance, you could export chili or mint products, both having growing global markets.
Get the necessary documents and licenses
The next step involves obtaining the certifications needed to start the spice export business.
It all starts with company registration; you could register as a private limited company or a limited liability partnership.
Get an FSSAI (Food Safety and Standards Authority of India) registration/license number according to your turnover. You would also need to procure the import-export code issued by the DGFT (Director General of Foreign Trade), which is a necessary document to start import/export in India. GST (Goods and Services Tax) Registration, Spice Board Registration, and ISO (International Organization for Standardization) Certification are some of the other documents you would need before starting the export business.
There is a huge market opportunity in spice export. However, there is also a lot of competition. The aim while exporting spices should be to find a niche segment and focus all the efforts to excel in the same.
Indian spices enjoy a lot of credibility in the world market, resulting in better opportunities for a potential exporter. Other factors that can inspire an individual to start a spice export business include the proven sustainability and economic viability of the Indian spice industry, various trade shows organized by the Spice Board of India, and subsidies provided to exporters that help them to send their products abroad at a lower cost.