Nagpur's Food Manufacturing Sector Faces Severe LPG Crisis
The ongoing LPG crisis has dealt a heavy blow to Nagpur's biscuit and bread manufacturing industry, forcing production shutdowns and drastic capacity reductions. This situation is creating significant challenges for both manufacturers and consumers of these daily-need products.
Production Shutdowns and Capacity Cuts
A Parle G manufacturing facility located in Khamgaon, Buldhana district, has completely ceased operations due to the unavailability of cooking gas. Numerous other units across the region are functioning at severely diminished capacity levels, struggling to maintain even basic production schedules.
Sources within the industry reveal that companies producing bread—which has a much shorter shelf life compared to biscuits—are experiencing particularly acute pressure. The perishable nature of bread means production disruptions have immediate consequences for market availability.
Major Brands Confirm Widespread Impact
TOI conducted interviews with management representatives from several prominent biscuit manufacturing units, who confirmed they are walking a tightrope due to the LPG shortage. Senior sources from well-known companies including Haldiram's, Dinshaws, and Ajit Bakery all reported significant impacts on their bread-making operations.
At some facilities, even the polymer-based laminates used for product packaging have become scarce or prohibitively expensive. Since these packaging materials are petroleum derivatives, the ongoing geopolitical tensions involving Iran have disrupted their supply chains and driven prices upward.
Nagpur's Three Major Biscuit Units Struggle
Nagpur hosts three significant biscuit manufacturing facilities. SAJ Foods, producer of the Bisk Farm brand, is operating its Butibori unit at merely 30% of normal capacity. The company maintains four additional units in West Bengal and one each in Bangalore and Nagpur, with all locations experiencing substantial production cuts according to insider information.
The Bangalore facility is attempting to sustain operations by utilizing piped natural gas as an alternative fuel source. Collectively, all SAJ Foods units typically produce approximately 14,000 tons of biscuits monthly under normal circumstances.
Another manufacturing unit supplying a national brand has reduced production by a staggering 70%. This facility normally produces 60 tons of biscuits daily for a leading market brand. Several units are also reporting shortages of essential food chemicals including sodium bicarbonate and ammonium bicarbonate, which are critical ingredients in biscuit manufacturing.
Consumer Impact Timeline and Bread-Specific Challenges
While biscuit manufacturers have either closed plants or significantly reduced output, consumers may not feel the full impact for approximately one month. Industry sources explain that dealers typically maintain inventory stocks ranging from 20 to 30 days.
However, this buffer does not apply to bread, which is a daily-consumption product with minimal storage capacity in the supply chain. Vikram Diwadkar, Director of Ajit Bakery, confirmed that bread-making operations have been substantially affected by the crisis.
"Even during the COVID-19 pandemic, bakers managed to sustain production levels. The current situation, however, is proving increasingly difficult. Packaging laminate rates have surged from Rs 230 per kilogram to as high as Rs 289-300 per kilogram, significantly increasing our packaging costs," Diwadkar stated.
Varied Impact Across Different Companies
A source from Dinshaws reported that bread production has decreased by approximately 15%, though the company has managed to maintain supply to markets. At Haldiram's, management sources indicated the impact has been more pronounced in their restaurant chains, while manufacturing plants have utilized alternative fuels to mitigate disruptions.
Nevertheless, bread production at Haldiram's has still experienced noticeable effects from the ongoing LPG shortage. The cumulative impact across Nagpur's food manufacturing sector highlights how regional industries are vulnerable to global supply chain disruptions and geopolitical tensions affecting fuel availability.
