dairying in indiadairyasia.org/events/9-10-mar-17/workshop_material/presentations_… · 01 march...
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Dairying in India
01 March 2017
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• Milk production by masses and
not mass production
• Dairying acts as an insurance for
the farmers in case of failure of
crop
• Offers relatively stable stream of
round the year income, ensuring
continuous cash flow
• While the share of agriculture in
GDP is declining, the same for
Livestock remains almost
constant
Indian dairying is based on
the “low input - low output”
model
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Socio-economic aspects
• 85% percent of India’s farmers are marginal or small. They own only 45 percent of farm land and almost 75 percent of bovines
• Animal holding has been found to be more equitable as compared to land holding
• Studies shows that families owning milch animals in rural areas consume almost three times more milk than the families which are not into dairying
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Bovine No. of
Operational
holdings
Operated
area
75%85%
45%
15%10%
24%
8% 4%
21%
2%1%
11%
Marginal+Small Semi Medium Medium Large
Source: Agriculture Census 2011 3
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• Generates 5-6% of total rural
employment
• Major source of rural
employment, especially women
employment
• Subsidiary income- contributes
about 12% of rural household
income
• Dairying an instrument for rural
prosperity & change with
gender inclusion
Dairying as a livelihood in India
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Female bovine ownership in India
1 animal
39%
2 animals
31%
3 animals
14%
4 animals
8%
4+ animals
8%
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Source of income for rural households
• According to “Situation Assessment Survey”, the livestock sector contributes
significantly to rural income
– About 26 % in case of the poorest households
– Overall it contributes to about 12% of rural income
<= 0.01
(ha)Upto 1 1.01-2.0 2.01-4.0 4.01-10.0 10+ (ha) All sizes
Non-farm business 10 10 8 5 4 4 8
Animal farming 26 14 11 11 8 6 12
Cultivation 1 30 57 69 78 86 48
Wages/ Salaries 64 47 24 15 10 3 32
0%
20%
40%
60%
80%
100%
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India’s share in global milk production
14.1%
14.0%
14.0%14.4%
14.7%
15.0%
15.7%
15.9%
16.3%
16.8%
16.7%17.4%
17.9%
18.3%
12%
13%
14%
15%
16%
17%
18%
19%
20%
2001
2002
2003
2004
2005
2006
2007
2008
2009
2010
2011
2012
2013
2014
7
Growth in milk production CAGR%
World 2.2% (2000 to 2015)
India 4.5% (2000-01 to 2015-16)
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Milk Production - India
31.6
53.9
80.6
121.8
155.5
0
20
40
60
80
100
120
140
160
180
1980-81 1990-91 2000-01 2010-11 2015-16
Milk production
2.232.67
4.12
6.74
0
1
2
3
4
5
6
7
8
80-81 to
90-91
90-91 to
00-01
00-01 to
10-11
10-11 to
15-16
Average annual increase in
milk production - million
tonnes
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India : milk production volume and growth
• World’s largest milk producer
– From 17 Million MT in 1951-52 to 156 Million
MT in 2015-16
– From deficit to self sufficiency
• Over last 15 years
– Milk production growing @ 4.5%
– Per capita availability growing @ 2.8%
• Average annual incremental volume for last 5
years over 6 million tonnes
• Rising share in global milk production
• Increasing contribution of milk to economy
• Rising share of productivity in production
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Milk’s contribution to economy
• Value of milk output ( ₹ 4923
billion) in India is now more than
the combined value of Paddy ( ₹
2310 billion) & Wheat ₹ 1296
billion )
• Livestock contributes about 25%
of agriculture & allied GDP
• Milk accounts for about 65% of
total value of output from
livestock
90-
91
00-
01
10-
11
14-
15
Milk 282 964 2638 4923
Paddy 253 656 1523 2310
Wheat 151 438 1028 1296
0
1000
2000
3000
4000
5000
6000
Value of output : Rs billion
at nominal prices
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Milk consumed/ used
in production areas itself
1960 lakh kg/day ~ 46%
Surplus milk sold from
production areas
2300 lakh kg/day ~ 54%
Domestic milk production
4260 lakh kg/ day
Surplus handled by:
Unorganised SectorOrganised Sector
(Coop + Private)
1416 lakh kg/ day 884 (442+442) lakh kg/ day
~ 62% of surplus ~ 38% of surplus
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% Household reported milk consumption
62
6668
71
767879
80
8385 85 85
50
55
60
65
70
75
80
85
90
87-88 93-94 99-2K 04-05 09-10 11-12
Rural
Urban
Source: Consumer Expenditure Surveys, NSSO, GoI12
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Share of milk in food basket
15% 15% 15% 16%19%
63%59%
55% 54%
49%
18% 18% 19% 19% 20%
55%
48%
43% 41%39%
0%
10%
20%
30%
40%
50%
60%
70%
1993-94 1999-2K 2004-05 2009-10 2011-12
Rural
Urban
Rural
Urban
Source: Consumer Expenditure Surveys, NSSO, Govt. of India
% Food expenditure to total monthly household expenditure
% Milk expenditure to food expenditure
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Factors influencing milk demand
Rising disposable income
Urbanization
Changing food habits
Rising population
Export opportunities
Demand
Drivers
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Urbanisation
216
286
377
626
26%
28%
31%
42%
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
0
100
200
300
400
500
600
700
1991 2001 2011 2030
Urb
an
izati
on r
ate
(%
)
Urb
an
popula
tion
(m
illi
on
Nos.)
Urban Population Urbanization rate
250
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Growth in per capita income
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Indian Dairy Market
According to IMARC estimates of
Indian Dairy market for 2014:
• Estimated dairy market size
was INR 5,030 billion (84
billion US$)
• Liquid milk accounts for 52% of
total dairy market, followed by
Ghee (12%)
• Indian dairy market was
dominated by Unorganized
sector (80%)
• Market grew at 15% during
2010-2014, expected to reach
values worth INR 11,543 billion
(US$ 192 billion) till 2020* UHT milk, Buttermilk, Flavoured milk, Lassi, Cheese, Probiotic Dairy
Products, Flavoured & frozen yoghurt
(in billion INR)
Category Sale: 2014Projected sale:
2020
Liquid milk (A) 2621 6068
Dairy products (B) 2408 5475
- Ghee 618 1367
- Khoa 456 949
- Dairy sweets 383 893
- Paneer 293 654
- Curd 216 493
- Butter 168 382
- Ice cream 89 220
- Dairy whitener 54 114
- Skimmed Milk Powder 50 113
- Others* 81 290
Total(A + B) 5030 11543
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Challenges for small holder dairy sector
Farm level challenges
• Low Productivity of Indian bovine
• Imbalanced feeding to animals
• Access of milk producers to organised sector
Processing & marketing level challenges
• Lack of transport infrastructure, cold chain facilities and refrigerated vehicles
restrict reach of quality dairy products to larger markets
• Large number of small & medium Milk Cooperatives which require immediate
expansion / up-gradation of their milk processing facility
• Maintaining profitable growth with pressure of rising input cost
• Ensuring quality of milk and milk product remains an issue due to high
presence of unorganized sector18
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Thank you
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