North India is getting really hot and so is the dairy industry. Before I talk a bit on the title of this blog ; the major news of last fortnight were launch of value added products by Prabhat, Godrej Agrovet and others particularly in milk beverage segment, Milk mantra becoming a bigger player in Oddisha and Amul eyeing on crossing Rs 50000 Crore turnover by next year.
In an interesting interview the Mr Pawan Agarwal CEO FSSAI assured the public that most of the milk being sold is not adulterated and is free from unsafe adulterants like Urea and detergents.It is only 10-12 % of the total milk being sold which may pose some safety issues .
Now let us look at over 200000 MT of SMP stocks in the country which is equivalent to roughly 12 % of the total milk production. The global prices are just USD 200 per MT short of Indian exporter's target which means that just a support of Rs 10-12 per kg from government may be a game changer.
Indian demand is also likely to increase looking at the heat wave and thus its impact on milk production. However the condition of farmer is really bad and in most part of the country he is not getting the price which he normally realized during this period. Amul has also clearly mentioned that they are not likely to increase the milk price this summer.
This year's scenario however has forced me to think on whether we really need this much production of milk in India? It is high time to match domestic consumption with available surplus of milk. Any further growth then must be backed up by a robust export policy for exporting milk products from India by considering it as a potential sector for exports (like being done for other verticals under food processing). Else we may be working hard on one side to increase production and farmers will be losing out in dearth of demand at all levels.
Happy e learning.
Chief Thinking Officer
Suruchi Consultants (ISO 9001:2008 Company)