NEW DELHI: Grappled with a myriad of issues such as underutilised capacities, inconsistent packaging quality, unavailability of trucks and labourers, food manufacturing companies fear scarcity of supply in the days to come.

To meet the unprecedented demand, fresh processing of flour, cooking oil and edibles need to be started at factory levels, but lack of workers, packaging supplies as well a cap on production limits at manufacturing plants are hampering the progress of work, say industry executives.

“Our factories are operating at 20-25 per cent production levels and about 25-30 per cent distributors of essential items have the permission to operate. But, the bigger challenge is labour shortage,” said Mayank Shah, senior category head, Parle Products.

With inventory depleting fast, he believes the latter part of the lockdown could see a ‘new normal’ as there is more clarity on logistics, albeit moving stocks down the supply chain remains a challenge with little manpower.

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CG Corp Global executive director Varun Chaudhury said that it is difficult to estimate when supplies would normalise in the current scenario. "As an industry, we are obligated to ensure that the supply chain remains robust but due to lack of labourers we aren’t able to scale up our production beyond 20 per cent of capacity utilisation. Unless there is clarity from the government, workers are unlikely to come back," Chaudhury said.

Indian Confectionery Manufacturer Association (ICMA), whose members include Nestle, Wrigley India, ITC Ltd, Dukes India and Mondelez, is also in talks with various state and district level authorities to facilitate smooth transportation of ancillary goods like paperboards, laminates, cardboards across the country.

"The ancillary industry such as packaging is as important as the food. Companies are making all the efforts to continue a steady supply of essentials, but it is becoming very difficult without packaging," said ICMA president BK Gurbani.

Officials in the packaging materials industry said they are also operating below installed capacity due to restrictions and acute shortage of manpower besides disruption of supply lines. "There is a shortage of food packaging material because there are issues in sourcing raw materials. The entire supply chain ecosystem is disrupted due to shortage of labour, packing materials and trucks etc and the government must react quickly to this situation or else we may have serious supply shortages by the third or fourth week of April," said Cosmo Films CEO Pankaj Poddar.

Factories of consumer companies such as ITC Ltd, the maker of Aashirvaad Atta, Britannia, Amul, Coca Cola, Godrej Consumer and Dabur are working at underutilized capacities on account of labour shortage.

Labour and packaging supply apart, there are many transporters who are not operating resulting in supply disruptions. According to industry executives, logistics predicament is more pronounced in states such as Assam and Uttar Pradesh, Himachal Pradesh, Telangana and Punjab as district administrations are allegedly not cooperating in issuing permits.

"Movement of goods has eased out a bit in the last couple of days but there is still a reluctance to serve long distance consignment without increased freight. Only about 30-35 per cent of truck drivers are working causing a shortage of raw materials, packing materials and even consumables," Vikram Agarwal, managing director at snacks maker Cornitos told this publication. 

Cargill's oils business in India MD Piyush Patnaik  echoed similar sentiments. "With automation and permitted labour, our manufacturing and supply chain teams are delivering the maximum possible output. Constraints such as unavailability of trucks and labourers are, however, making it difficult for supplies of goods to reach the retail market. If this perisits, we may also have to live through a period of scarcity in some goods in the coming days," he said.