Monday, January 16, 2017

29th Dairy Pulse 1st jan to 15th jan


Dear friends,

A very Happy New Year to you all. This is a very exciting year for dairy industry in particular. We may also call it as an year of  Dairytilisation wherein the most fragmented industry in the country would learn on how to make use of digital gateways to
digitalize the complete payment process across the value chain from Feed to Table. 

The year started on a good note with the Minister of agriculture sharing the increase in per capita availability of milk as well as milk production in India in 2015-16. The milk production has registered a growth rate of 6.28% during 2014-16, which is higher than last years growth rate of about 4 per cent and three times more than the world average growth of 2.2%.

Milk production in India has increased from 22 million ton in 1970 to 156 million ton in 2015-16, which shows a growth of 700 percent during last 46 years. As a result, the per capita availability of milk in India is 337 gram/day as compared to average world per capita availability of 229 gram/day. This must have been highest recorded growth in agri-commodity in India atleast in the primary production category.

Another news mentions about big leap taken up by private sector for Indian dairy development. Today the Chennai-based Hatsun Agro Product Ltd alone procures an average 26 lakh litres per day (LLPD) or close to 1 mt annually. Besides, there are at least 9 companies with an average milk procurement of 10-15 LLPD each (Parag Milk Foods, Schreiber Dynamix Dairies, Heritage Foods, Tirumala Milk Products, Kwality Ltd, Sterling Agro Industries, VRS Foods, Bhole Baba Milk Food Industries and Nestle India) and many others that do 5-10 LLPD (Prabhat Dairy, Indapur Dairy, Dodla Dairy, Creamline Dairy Products, SMC Foods, Milkfood, Gopaljee Dairy Foods, and Anik Industries).

On the other side  a major chunk of coopretaive sector total average milk procurement of around 415 LLPD in 2015-16 was accounted for by only 5 state-level federations: Gujarat (‘Amul’ at 170 LLPD), Karnataka (‘Nandini’ at 63 LLPD), Tamil Nadu (‘Aavin’ at 30 LLPD), Rajasthan (‘Saras’ at 25 LLPD) and Bihar (‘Sudha’ at 17 LLPD). The cooperative sector now basically comprises a few large players that are mainly into liquid milk marketing, whereas private dairies cover a host of medium-scale corporates, most of them post-1992 entrants and, interestingly, very few multinationals. 

By 2020, procurement by private dairies is projected to reach 28.93 mt, ahead of the 23.67 mt of cooperatives, according to the latest edition of the industry publication, Dairy India.
The report also mention that India would be `10-lakh crore market by 2020; and money is seen in liquid milk, dahi and khoa, not in cheese and butter.

Another report  predict huge demand for dairy products in the country this year. The prices of milk and milk products will increase by more than 10 per cent, which will facilitate more income for dairy farmers. Educated unemployed youths may emerge as entrepreneurs and venture into dairying. The country will witness spectacular growth in dairy processing units, they note. 

One of the reasons for such increase in market milk prices would be shortage of available milk powder by the end of March 2017 thereby forcing dairy companies to pay more money to farmers so as to get their share of raw milk during the summer.


As an insight we look forward to relaxed policies from the government of India to facilitate import of milk powder from global markets in summers of 2017. There has not been much of traction in the global prices. However the policy maker must make tradeoff between easing out milk availability to consumers at a reasonable rate or supporting dairy farmers to get higher prices.

We wish you a happy e-learning.

with best regards

Kuldeep Sharma
Chief Thinking Officer
Suruchi Consultants (ISO 9001:2008 Company)
C-49 Sector-65
Noida 201307

Sunday, January 1, 2017

Happy New Year 2017 from Team Suruchi and Dairy Pulse (28th Dairy Pulse 16th to 31st Dec 2016)


Dear friends,

Firstly accept our best wishes for a prosperous , purposeful and exciting new year ahead from Team Suruchi.

Last fortnight saw a silver lining of emerging digitalization in dairy space.Most of the news were related to digital financial inclusion of farmers at one end and digital payment linkages of dairy consumers on the other. As usual Amul is leading the dairy fraternity in creating digital payment access to over 3 million farmers by the end of this year. 

There was a  news related to extra subsidy to farmers in a couple of districts in Karnataka. However we have always condemned such differential support to cooperatives only which actually disturbs the level playing field for private dairy players. 

The Food Safety and Standards Authority of India (FSSAI) issued on Monday a new guideline that sets standards for fortification of food products with vitamin, iodine, folic acid and other nutrients across all items, stipulating minimum and maximum levels.

The new rule says every manufacturer and packer will have to give an “undertaking” on quality assurance and “submit evidence” of the steps taken, including getting the test done of the product from an approved government laboratory.

It is most likely for dairy consumers to pay more for their milk and milk products in the new year. Large dairy companies are seriously thinking over it.

Government of India is planning to give preference to local breeds for development of dairy farm eco system.The Centre has raised the yearly budget allotment for development and conservation of indigenous breeds, from Rs 45 crore in 2013 to Rs 582 crore now. A ‘Rashtriya Gokul Mission’ has been launched for this.

Recently, Union Agriculture Minister Radha Mohan Singh said there was a need to market A2 milk separately, for the benefit of consumers and poor farmers rearing indigenous cattle. He claimed indigenous breeds were hardier and produced healthier milk. About Rs 2 crore each has been sanctioned to Odisha and Karnataka for marketing of A2 milk. A National Mission on Bovine Productivity has been allocated Rs 825 crore.

Around two years back Suruchi in it's vision document first talked about the differential pricing for Desi cow milk at milk procurement which has been getting considered in a different way now.
In the neighboring country Pakistan, a commission has set up by the Supreme court to test the quality of milk and water. 

At global level the industry is very optimistic about improvement in prices and thus sustainability of global dairy industry.

Let us hope all good for our dairy sector and wish good prices for farmers, good profits to the processor and safe milk and milk products at a reasonable price for our consumers.

We are also enclosing snapshot of Dairy Pulse news from May 2016 onwards for you to review the passing year in one go.

With a promise to serve you more and in a better way, we once again wish you a great New year 2017, 

Happy e reading.


with best regards


-- 
Kuldeep Sharma
Chief Thinking Officer
Suruchi Consultants (ISO 9001:2008 Company)
C-49 Sector-65
Noida 201307