The Hindu Business Line : Agro Dutch plans unit in Chennai to produce cans

AGRO Dutch Industries Ltd based in Chandigarh, a producer and exporter of mushrooms, plans to set up a Rs 40-crore facility to manufacture cans in Chennai. The details are being worked out and the company is scouting for land in Tamil Nadu.

Mr Malvinder Singh, Chairman, Agro Dutch Industries Ltd, told Business Line this was part of Agro Dutch's expansion plans which involve expanding its mushroom production and packaging material facilities.

Mushroom production expansion is to happen at its existing facility in Chandigarh and the can-making unit near Chennai. This will be another line of business that will target the need for high quality food grade cans for food processors in the South.

Agro Dutch now produces about 37,000 tonnes of mushrooms a year and will expand production to 50,000 tonnes at a cost of Rs 25 crore.

Prospects for Agro Dutch are looking up in the current year with the US market opening up. Agro Dutch, which earlier faced an anti-dumping duty of more than 30 per cent, now needs to pay about 0.62 per cent. It has significant export orders from US-based companies. This is one of the factors that have prompted Agro Dutch to embark on the expansion, Mr Singh said.

Another development concerning the US market would be the anti-dumping duties on Chinese producers of mushrooms to be announced on September 5. While Agro Dutch is competitive at present levels, if anti-dumping duties are high on China, Agro Dutch would be far ahead in the game, he said.

It may be recalled that Calibre Rehabs Ltd, promoted by Mr Malvinder Singh, acquired Saptarishi Agro Industries Ltd, from the B M Thapar Group's Global Green Company Ltd in January 2003. Mr Singh is also the Chairman of Saptarishi Agro Industries Ltd, a mushroom unit in Chinglepet, about 50 km south of Chennai.

Various issues that delayed start of production, including pollution clearance, have been sorted out and Saptarishi Agro started production recently.

Its output is about 2 tonnes a day, Mr Singh said. By September, the production would be stepped up to 4 tonnes a day and by April 2006 it is expected to operate at 100 per cent capacity to produce about 5,000 tonnes a day.

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