The Byadgi Kaddi and Dabbi varieties of chili are highly sought after across numerous industries. Renowned for its vibrant color and milder heat, Byadgi chili is preferred for its ability to impart excellent natural color with reduced pungency. It finds extensive use in the production of pickles, masala products, and chili powder. Moreover, its enduring bright red hue makes it a favored choice as a coloring agent and for the extraction of Oleoresin, a concentrated spice extract dissolved in a solvent.

Oleoresin serves as a vital coloring agent in the manufacturing of cheese, sauces, and spice blends, and intensifies the color of egg yolk. Its applications span confectionery, cosmetics (such as lipsticks), beverage industry (for enhancing the hue of fresh wine), meat processing, pharmaceuticals, poultry and cattle feed, and textile dyeing. In regions like Sri Lanka, Bangladesh, America, Europe, Nepal, Indonesia, and Mexico, Byadgi chilies are increasingly utilized as substitutes for paprika by oleoresin manufacturers.

Following cultivation in Byadgi, these chilies are transported to major exporters situated in Cochin (Kerala), Tamil Nadu, and West Bengal. Subsequently, after value addition processes, products like Paprika Oleoresin are exported to various destinations.