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Group no.2

Members- Ranjan, Piyush, Akram, Bharath, Somojit Auddy

India is the largest producer of milk in the world and accounts 21% of the worlds production. India is with highest livestock populations in the world, it accounts 50% of the buffaloes and 20% of the worlds cattle population, most of which are milch cows and milch buffaloes. Indias dairy industry is considered as one of the most successful development industry in the postIndependence era. In 2005-06 total milk productions in the country was over 90 million tonnes with a per capita availability of 229 gms per day. During 1993-2005, the dairy industry recorded an annual growth of 4%, which is almost 3 times the average growth rate of the dairy industry in the world. The total milk processing in India is around 35%, of which the organized dairy industry accounts for 13% while remaining is either consumed at farm level, or sold as fresh, non-pasteurized milk through unorganized channels. The milk surplus states in India are Uttar Pradesh, Punjab, Haryana, Rajasthan, Gujarat, Maharashtra, Andhra Pradesh, Karnataka and Tamil Nadu. The manufacturing of milk products is very much concentrated in these states due to the availability of milk in huge quantity. According to the Ministry of Food Processing Industries, exports of dairy products have been growing at the rate of 25% per annum in terms of quantity and 28% in terms of value since 2001. Significant investment opportunities exist for the manufacturing of value-added milk products like milk powder, packaged milk, butter, ghee, cheese and ready-to-drink milk products.
Rationale of choosing the industry

Dairying is an important source of subsidiary income to small/marginal farmers and agricultural labourers other than agriculture. The manure from animals provides a good source of organic matter for improving soil fertility and crop yields. The main aim of the Indian dairy industry is only to better manage the national resources to enhance milk production and upgrade milk processing using innovative technologies. Since agriculture is mostly seasonal, there is a


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possibility of finding employment throughout the year for many persons through dairy farming. Thus, dairy also provides employment throughout the year. The main beneficiaries of dairy programmes are small/marginal farmers and landless laborers.
Size of Indian Dairy Industry

Dairy India 2007 has estimated the size of Indias dairy sector in 2005 at Rs 227,340 crore (valued at consumer prices). The largest contributor to this is liquid milk (at Rs 82,835 crore), followed by ghee (Rs 22,980 crore), khoa/chhana/paneer (Rs 24,100 crore), milk powder (Rs 4,680 crore), table butter (Rs 770 crore), cheese/edible casein (Rs 975 crore) and other products such ethnic sweets, ice-cream, etc (Rs 9,100 crore). Out of the total milk production of 94.5 mt, 77 per cent or 73.1 mt is sold as liquid milk, with the balance 23 per cent or 21.4 mt converted into products. Further, the organized industry handles only 18 per cent or 17 mt of milk, with 36 per cent (34.5 mt) being handled by private dudhias and unorganized players and 46 per cent (43 mt)being retained in rural areas. Within the 18 per cent organized sector share, private and cooperative/government dairies handle an equal 8.5 mt each.
Growth Potential (Market)

The total milk production in the country for the year 2008-09 was estimated at 108.5 million metric tonnes and the demand is expected to be 180 million tonnes by 2020. To achieve this demand annual growth rate in milk production has to be increased from the present 2.5 % to 5%. Thus, there is a tremendous scope/potential for increasing the milk production through profitable dairy farming.
Importance of Dairy Farm in economy

By 2011, Dairy India projects the value of the industry to more than double to Rs 520,780 crore, which includes Rs 159,600 crore from liquid milk, Rs 42,680 crore from ghee, Rs 50,500 crore from khoa/chhana/paneer, Rs 9,100 crore from milk powder, Rs 2,250 crore from table butter, Rs 6,150 crore from cheese/edible casein and Rs 25,050 crore from other products. Interestingly, out of the anticipated milk output of 120 mt, the share of liquid milk will rise to 81 per cent or 97.5 mt and only the rest 19 per cent (22.5 mt) would get converted into products. But the


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organized industrys share of total milk handling will go up to 30 per cent (36 mt), while the small players will see their share dip to 22 per cent (26 mt). At the same time, higher rural incomes will marginally boost the share of milk retained in rural areas to 48 per cent or 58 mt. The other significant feature is that within the 30 per cent overall share of organized dairies, the major 20 per cent (24 mt) will be accounted for by the private sector. The cooperatives and government dairies will handle 10 per cent or 12 mt of milk, which will be lower than that of the organized private sector.
Competitors in Dairy Industry: -

Private competitors and small dairy cooperatives (In an organized dairy industry, dairy cooperatives account for the major share of processed liquid milk marketed in India. Milk is processed and marketed by 170 Milk Producers Cooperative Unions, which federate into 15 State Cooperative Milk Marketing Federations. Over the years, several brands have been created by cooperatives like Amul (GCMMF), Vijaya (AP), Verka (Punjab), Saras (Rajasthan). Nandini (Karnataka), Milma (Kerala) and Gokul (Kolhapur).

Organization Description
Name of Organization- GCMMF(Amul)
Description- Amul ("priceless" in Hindi. The brand name "Amul," from the Sanskrit "Amoolya," (meaning Precious) was suggested by a quality control expert in Anand.), formed in 1946, is a dairy cooperative in India. It is a brand name managed by an apex cooperative organisation, Gujarat Co-operative Milk Marketing Federation Ltd. (GCMMF), which today is jointly owned by some 2.8 million milk producers in Gujarat, India. Amul is based in Anand, Gujarat and has been an example of a co-operative organization's success in the long term. "Anyone who has seen the dairy cooperatives in the state of Gujarat, especially the highly successful one known as AMUL, will naturally wonder what combination of influences and incentives is needed to multiply such a model a thousand times over in developing regions everywhere." The Amul Pattern has established itself as a uniquely appropriate model for rural development. Amul has spurred the White Revolution of India, which has made India the largest producer of milk and milk products in the world. It is also the world's biggest vegetarian cheese brand. Amul is the


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largest food brand in India and world's Largest Pouched Milk Brand with an annual turnover of US $1700 million (200910).[5] Currently Unions making up GCMMF have 2.9 million producer members with milk collection average of 9.10 million litres per day. Besides India, Amul has entered overseas markets such as Mauritius, UAE, USA, Bangladesh, Australia, China, Singapore, Hong Kong and a few South African countries. Its bid to enter Japanese market in 1994 did not succeed, but now it has fresh plans entering the Japanese markets

Primary Data Collection Survey through structured questionnaire Formal and informal interview

Collection of Secondary Data Profile of dairy companies Market analysis through websites

Outline of the Report

Chater 1- Introduction Chapter 2- Methodology Chapter 3- Analysis of Data and Key Findings Chapter 4- Inference Chapter 5- Recommendations


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