Seafood Processing Sparkles
Along India’s Southeastern Coast
By JOHN M. SAULNIER, QFFI Chief Editor & Publisher

For well over a century, Tamil Nadu’s premier deep-water harbor has been a bustling hub of maritime activity. While the tropical seaport city of Tuticorin is still known as “Pearl Town,” its once booming ocean mollusk-bearing gem trade was some time ago outshined by other commercial interests – among them the finfish and shrimp catching, farming and processing industries.

Positioned along the Gulf of Mannar near the peninsular tip of southeastern India, approximately 540 kilometers south of Chennai (Madras), Tuticorin is home to the nation’s third-largest container terminal. Marine products exported from the port topped $162 million in value last year, ranking the region as the sixth most important seafood source on the subcontinent in terms of generating foreign currency.

Interestingly, two of the most prolific seafood processing companies in the area proudly trace their heritage to a single visionary entrepreneur. Born into a multi-generational family of fishermen, Mr. Chandran Devanesam branched out into mechanized boat building while successfully operating a number of fishing vessels almost 40 years ago. His fleet expanded to 25 boats, all of which supplied local seafood processing plants with bounty harvested from the Gulf as well as the Arabian Sea and Indian Ocean.

In 1976 he ventured into the processing side of the business by establishing the DSF Group of Companies, which today is ably run by five talented sons and their capable managers.

A fleet-fingered female crew at Nila Sea Foods sorts black tiger shrimp at a stainless steel work table before it is further processed at the Tuticorin plant.

Block-frozen headlless shell-on black Tiger Shrimp (as seen above) is popular among foodservice buyers, while IQF shrimp is in demand both by restaurateurs and retailers.

Another son, D. Chandran, independently set up his own fish processing unit in 1990. Nila Seafoods Pvt. Ltd. has grown steadily to the point where it presently employs 1,200 people and generates revenues of approximately US $75 million per annum.

This writer, having recently met Managing Director Chandran and his son, C. Selwin Prabhu, during the India International Seafood Show in Kerala, was pleased to accept an invitation to visit the Nila plant in Tuticorin. Situated some 350 kilometers southeast of Kochi as the bird flies, an overnight rail journey aboard an express train, followed by a 60-minute drive by automobile, gets one to the destination in approximately 10 hours.

The EU- and USFDA-approved manufacturing enterprise features two state-of-the-art, laboratory-equipped plants, which in combination are capable of turning out 80 metric tons of frozen seafood per year. Outfitted with IQF technology supplied by Bakel, Holland-headquartered CFS, the air-conditioned Nila operation’s highly efficient processing system incorporates a steam cooker/blancher, a contra flow chiller, a vibratory shaker designed to remove excess water from product, a TempoFrost spiral freezer with throughput capacity of up to 850 kilograms per hour within its constantly maintained -42° C confines, and a double-pass glazer/hardener.

Raw materials, sourced from landing centers dotting beaches from Chennai to Colanchal, are speedily transported to both plants via a motor pool of some 45 insulated trucks.

In addition to Nila brand marine products, the company also packs the Amulya Seafoods label, which was acquired some years ago. Other brands produced include Amica, Asha and Akini.

Among headless shellfish items specialized in by Nila are Flower Shrimp (Penaeus semisulcatus), White (P. indicus) and Black Tiger (P. monodon), Bamboo (P. japonicus) and Brown Shrimp (metapenaeus ssp.). Peeled and deveined varieties of numerous species are available, as are shell-on and heads-on offerings.

D. Paulpandi is managing director in charge of purchase, production, finance and marketing for the DSF Group of seafood processing companies.

Sashimi-grade squid fillets (Sepiothuthis spp.) are prepared by a skillful team of young ladies at the one of the DSF Group plants in Tuticorin, India.

When Quick Frozen Foods International (QFFI) magazine toured Nila’s processing halls – which gleamed with marble floors, walls and stainless steel work tables – farm-raised Black Tigers were skillfully being sorted, peeled and deveined by a rubber glove-wearing, yet still fleet-fingered team of young ladies decked out from head to toe in hygienic garb. At every step of way prior to cooking and freezing, the just-delivered shrimp was constantly cooled with chilled water and ice. The plant has capacity to produce 10 tons of flake ice daily, made from filtered water.

The day before QFFI’s visit, wild-caught P. semisulcatus was processed. “All of those shrimp, which are especially favored by Japanese buyers for their sweet tasting flavor profile, are exported to Japan. Most of the other shrimp species we pack are shipped there as well,” pointed out V.S. Santha Kumar, quality assurance manager.

It was not always that way, as a fair amount of shrimp used to go to the USA until Washington imposed anti-dumping duties on Indian exports as well as customs bonds requirements on importers.

“Before these unfortunate developments came into being several years ago, we had a good business relationship with customers in the United States, which is the world’s largest seafood importing nation,” said Director C. Selwin Prabhu. “Now we export no more than five percent of our volume to the US, compared to 14% prior to the tariff.”

QFFI asked if the recent action by the WTO’s Dispute Settlement Panel, which resulted in a reduction of the tariff from 10.7% to 7.22%, will have a positive impact on future trade.

“No, because it is still an unfair burden,” replied Mr. Prabhu. “Even moving a single container of shrimp is very difficult at the moment. So most seafood companies in India have all but stopped doing business in America. Today, 70% of our exports go to Japan, with European countries taking 20% of the volume. EU buyers particularly like our cuttlefish and octopus products.”

Wild-caught shrimp harvested by Tuticorin-based fleets, which are sourced in waters between Tamil Nadu and Sri Lanka, typically fetch a premium price of 60- to 80-cents per kilogram at the market.
Non-shrimp items produced by Nila range from raw, sashimi-grade Squid Fillets (Aori-Ika, Yari-Ika and Semi-Needle) and Blue Swimming Crab (Portunus Pelagicus) to Cut Crab. Squid unloaded by fishermen at local docks reportedly commands up to $1 more in final processed form than like product originating elsewhere in India.

Kanni brand Seerfish and Barracuda Steaks in see-through retail packages are among 25 different finfish products produced by the DSF Group.

The Amulya plant, situated on a three-acre parcel of land near the Nila facility, was among the first 10 factories in India to have attained EU export approval. Furthermore, the Government of India has designated it as a “Golden Trading House” for export performance, as well as honored Nila with its “Best Productivity Performance Award” for three years in a row.

Some 500 employees work at the Amulya factory, which has capacity to blast-, contact- and IQF-spiral freeze approximately 40 tons of product per day.

Production of consumer packs is the unit’s forte. Among such offerings are Red Ring Shrimp (Solenoura spp.), Cuttlefish Fillets (Sepia spp.), IQF Sand Lobster (Thenus orientalis) and Big Lobster (Octopus spp.).

Also produced are Shark (Scoliodon Latic audus), King Fish (Scomberomorous spp.), Silver Pomfret (Pampus argenteus), Emperor (Lutjanus spp.), Barracuda (Sphyraena jello) and Red Mullet (Papenacus indicus).

Nila Cold Storage Pvt. Ltd., established in 1999, is the third business component operated by the company. Said to be the largest public refrigerated warehouse in southern India, it has capacity for 10,000 metric tons. Separate chambers are dedicated to storage of fruits and vegetables. A wide assortment of products is maintained on the premises by farmers and marketers. Foodstuffs range from potatoes and chilies to carrots, tamarind, dates, apples, oranges, pears, watermelons and pineapples.

DSF Group of Companies

“To seek, to strive, to strike and not to yield” remains the revered motto of the DSF Group of Companies more than three decades after it was established by Founding Chairman Chandran Devanesam. Today the Tuticorin-headquartered conglomerate, ranked as the most prolific frozen seafood concern in the region, remains driven by his spirit under the skillful guidance of five sons: Chairman D. Sathianathan, Managing Director D. Paulpandi, and Directors D. Durairaj, D. Manoharan and D. Anbalagan.

The firm, which cumulatively generated US $58 million in turnover last year and employs approximately 1,500 people system-wide, specializes in producing more than 45 products ranging from raw, block frozen – and soon IQF – Black Tiger, Flower, White and Sea Tiger shell-on shrimp, and peeled and deveined Flower Shrimp distributed in consumer and bulk packs, to Blue Swimming Crab and Cut Crab with Claws.

Cephalopod items offered include Squid in numerous forms, such as whole, tube, semi needle tube and fillets, in addition to Cuttlefish and Baby Octopus.

A wide assortment of 25 different finfish offered to clients runs the gamut from Trevally and Red Mullet to Commerson’s Anchovy, Mackerel, Reef Cod, Seerfish, Shark, Pomfret, Sooparai, Barracuda, Rays and Rabbit fish.

The prize-winning company – which has received the National Productivity and Best Export Awards from the Government of India – consists of Diamond Sea Food Exports (the flagship unit, established in 1976, from which the DSF initials are derived), Kadal Kanny Frozen Foods (circa 1982), Theva & Co. (1995) and Edhayam Frozen Foods (2002).

Four factories supply customer needs, as do an aquafarm and hatchery. Combined plant capacity is 64 tons of plate-frozen fishery products, plus another 19.5 tons of blast-frozen items per day. Chilled room capacity is 60 tons, and cold storage capacity is 1,460 tons.

This writer inspected the ISO 9001-2000-certified Theva & Co. unit, which is situated about 10 kilometers from the Port of Tuticorin and supplied by a 70-truck fleet of insulated and/or refrigerated vehicles. They deliver raw materials from points in southeastern India located no more than a three- or four-hour drive from the plant. Along with the Edhayam Frozen Foods facility, the Theva & Co. premises plant is EU-approved for exporting shrimp, crab, squid, cuttlefish, octopus and other fishery products to Europe.

The EU took 43% of the company’s output last year, second only to Japan at 45%. Kanni branded products are marketed primarily to the Japanese, while the Sun label shines in Europe. A third brand, Arokia, is popular in numerous countries.

Exports to the USA have slipped to eight or nine percent in recent years, with clients elsewhere taking the remaining volume.

The DSF Group began exporting non-shrimp products to Europe in 1990, after a buyer in Paris requested seerfish. “It was in demand from a growing community of Sri Lankans residing in France,” recalled A. Muthukumar, a veteran production manager who has been on the job since 1986. “Soon thereafter we began selling seerfish and other products in the United Kingdom and Germany too.”
Today, squid and cuttlefish are the biggest items for the European market, with most of it going to Spain.

The United States takes much of the Group’s crab output, at 40%, followed by Japan and the European Union receiving 30% each. It is shrimp, however, that dominates sales globally, ringing up about 56% of sales in value terms.

Aquaculture Booms at Vaipar Ponds

In recent years aquaculture has loomed large for DSF, to the point where farm-raised shrimp now represent 45% of total volume sold compared with just 10-15% at most in the past. This is because of the trend toward lower landings of sea-caught shrimp, explained Managing Director D. Paulpandi, who is specifically in charge of purchase, production, finance and marketing activities.

The company’s Thevaerudhayamn Aqua Farms operation is based south of Tuticorin, in Vaipar. It consists of 156 filtrated sea water ponds spread out across 115 hectares of land. They yield about 600 tons of the P. monodon species, for which brood stock is supplied from a 17-acre, DSF-owned hatchery in Mundal, Ramanathapuram District.

Looking to the future, the managing director said that India will have to begin importing P. vannamei seed and produce that variety of white shrimp as well as monodon to remain competitive on global markets, let alone sustain profitability.

“Last year volume sales of Black Tigers – which are more expensive to produce – was down 19%, and value was down by 15% compared to the previous year,” said Mr. Paulpandi. “We will have no choice but to get into vannamei production if we are to remain in the shrimp farming business.”

Meanwhile, on another front, the company will soon be getting into the lodging business with the opening of a three-star hotel and shopping mall – the DSF Grand Plaza – in the heart of Tuticorin on V. E. Road. The accommodations are being designed and outfitted to appeal to businessmen as well as journalists, so this writer can well imagine where he will be staying when next in town.