Sustenance of dairy industry during CoVID-19:
- To enhance the marketing of milk and milk products, many dairy organisations, initiated home delivery of milk and milk products through mobile carts, vans, e-commerce, etc.
- All these measures helped stabilise milk sales, opening up opportunities to use e-commerce.
- Many smart and progressive dairy farmers converted their surplus milk into khoa, paneer, ghee, etc, and sold it to the neighbourhood markets through informal channels.
- The US is contemplating to purchase milk, convert it into commodities which could be used as international humanitarian aid.
- All these measures helped sustain dairy industry.
Changing dynamics of dairy sector due to pandemic
- Even though dairy cooperatives handle about 40 per cent of the total marketable surplus of the milk in the country, they are not a preferred option of landless or small farmers.
- This is because, on average, fat-based pricing in dairy cooperatives is 20 to 30 per cent lessthan the price in the open market.
- For instance, buffalo milk fetches Rs 65/kg in the open market in Jaipur city, while the price in dairy cooperative ranges between Rs 35/kg and 55/kg depending on the fat content of the milk.
- More than 75 per cent of the milk bought by dairy cooperatives is at its lower price band.
- Moreover, in the early lactation phase (the most productive period in terms of quantity of milk) fat content in the milk is relatively low and farmers often manage their livelihood by selling the milk in the open market at a higher priceduring the early cycle of lactation.
- Milk vendors and individual buyers pay by quantity and not by its fat content.
- The recent crisis of low milk prices is due to the destruction of demand in the hotel, restaurant and catering sectors, which consume about 25% of the total marketable surplus.
- During the pandemic, there has been a self-imposed ban on door-to-door sale of liquid milkby households both in urban and rural areas, forcing farmers to sell the entire produce to dairy cooperatives at a much lower price.
- The closure of shops had cut down the demand for milk and milk products while severe shortage of fodder and cattle feed has pushed up the input cost.
- Further, private veterinary services have almost stoppeddue to Covid-19, which has led to the death of milch animals.
Ways for holistic development of dairy sector
- Dairy farmers need the following to continue their vocation:
- One, a stable market and remunerative price(ignoring fat content or giving more weightage to the quantity of milk) for liquid milk;
- two, uninterrupted supply of fodderand cattle feed at a reasonable price;
- three, regular supply of veterinary servicesand medicines.
- The government has launched the FMD vaccination programme and 1.5 crore cows and buffaloes have been vaccinated.
- Once India is declared free of FMD by the Paris based intergovernmental World Organisation for Animal Health (OIE), Indian dairy and meat exports will not face non-tariff barriers.
- This can open up export markets for Indian dairy and meat.
- In 2019-20, India earned just $86.73 million from the export of dairy products. In the next 5-10 years, if India can get FMD free status, several products like buffalo mozzarella cheese, ghee etc. can be exported to the US and the European Union.
- There is a large scope of attracting private investment in the milk sector. For that, the government should release data on existing capacity in each district of India.
- Once schools reopen, states must consider providing milk and eggs to students under the mid-day meal scheme so that locally produced and unadulterated food is made available to children of the poor, who form the majority of students in government schools.
Covid-19 pandemic has thrown up the real possibility for our dairy industry to benefit as large sections of consumers may shift from meat-based to dairy-based protein. Covid-19 has made people more aware of the need to adopt a healthy diet. Covid-19 crisis has witnessed reverse migration of labour force from urban to rural areas leading to social disruptions. On the positive side, we can look at this as an opportunity; these workers can be encouraged and incentivized to join their family agriculture/dairy farms.
