Prospects and Threats in the Sustainable Small-Scale Dairy Industry

Surya Kant^*1, Saurabh Tiwari¹, Vikas², K. D. Singh³, A. K. Verma³, A. K. Singh⁴ and M. K. Verma^5*1M.V.Sc. Scholar, Department of Livestock Production Management

^*1M.V.Sc. Scholar, Department of Livestock Production Management

¹PhD Scholar, Department of Livestock Production Management

²M.V.Sc. Scholar, Department of Livestock Production Management

³Assistant Professor, Department of Livestock Farm Complex

⁴Assistant Professor, Department of Livestock Production Management

⁵Assistant Professor, Department of Animal Genetics and Breeding

Introduction

Since independence, dairy production in India has experienced significant growth. In India’s remote regions, dairy farming has been crucial in boosting revenue for families and preserving food security.India is the world’s top producer of milk, with an annual production of 221.06 million tonnes in 2021–22 compared to 209.96 million tonnes in 2020–21, reflecting a growth rate of 5.29%, partially due to judicious policies being implemented.In accordance with predictions in FAO’s Food Outlook (November 2022), global output of milk expanded by 1.34% throughout 2020 and 2021, from 912.6 million tonnes to 924.8 million tonnes. For the well-being of an ever-growing population, this predicts a steady increase in the accessibility of milk and other dairy products.

In order to accomplish economic growth, food security, and poverty reduction, the dairy sector is a sustainable, equitable, and powerful tool. This can be achieved as dairying proposes a consistent source of income, nutritious foods, risk diversification, improved utilization of resources, on- and off-farm job possibilities, scenarios for women (e.g. milk money from it), stability in the economy, and status in society (e.g. conserve budgeting and resource generation).

In India, the dairy industry has had a significant socio-economic impact. These usages have persisted as a result of traditional, cultural, and faith-based convictions.In addition to offering millions of people the opportunity to consume affordable, nutritious diets, these products are also crucial in creating profitable livelihoods in the rural economic growth, specifically for women and landless, small, and marginal farmers. India endures as the world’s biggest producer of milk. The government has launched a number of initiatives to accelerate animal productivity, which have dramatically boosted milk production.

Many thousands of families in rural areas now rely primarily on dairy farming as a secondary source of income, and it additionally serves a major role in creating opportunities for employment and revenue streams, especially for women and marginal farmers. In 2021–2022, the per capita availability of milk reached a level of 444 grams per day, which is higher than the estimated global average of 320 grams per day in 2021 (Food Outlook Nov. 22).

Per Capita Availability of Milk by States/UTs (Grams/day)

States	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19	2019-20	2020-21	2021-22
All India	307	319	333	351	370	390	406	427	444
Uttar Pradesh	318	329	339	352	363	377	387	377	392
Delhi	39	43	42	41	40	–	–	–	–
Uttarakhand	418	404	421	426	433	441	447	437	446
Tamil Nadu	280	265	267	277	283	304	316	353	362
Bihar	195	193	202	209	209	218	228	240	260
Jammu & Kashmir	302	413	476	494	507	520	507	534	557
Andhra Pradesh	413	522	579	649	728	794	799	768	799

Source: Basic Animal Husbandry Statistics, MoFAHD, DAHD, GoI

Dairy farming among tiny-scale farmers: Key Elements

• Shelter/House: Requirements for floor space may be followed as per recommendations, with a special focus on the farmers’ financial state. Stressful environments significantly reduce productivity, so it’s important to protect the animal from adverse weather. Animal dwellings are also extremely important for implementing the maximum potential of the animal.
• Estimated capability / Number of milch animals in general: This is essential information for farmers to figure out investment based on their financial situation. In addition, farmers may be eligible for various government and non-governmental organization support initiatives.
• Site plan, area, appropriateness, closeness to a road, and other factors associated with the property and its growth.
• Chaff cutter, silo pit, milking machine, feed grinder and mixer, milking pails and cans, biogas plant, bulk coolers, and manufacturing of products apparatus are a few instances of equipment, plant, and machinery.
• The decision about the kind of animal and breed plays an important role in smallholder dairying. Factors such as the purpose of the breed, species, source, location, and cost of the animal ought to be taken into account.
• Nutrition management: Homemade concentrate preparations, dry feed, green feed, and concentrates, as well as scientific feeding approaches, fodder cultivation expenditures, and fodder sources can all contribute to dairying’s inexpensive costs of production.
• Performance indicators: In grassroots dairy production, the metrics related to conception rate, mortality (%), lactation days, lactation yield (liters per day), lactation order, and dry days are extremely important. It’s noteworthy that one completely incorporates principles like “calf per year.”
• Animal veterinary care and ailments prevention is of the utmost importance for dairy farming since it assists with diseases detection, immunization, deworming, isolation, and other operations. To determine the yearly expenditure per animal, it is possible to record the medications implemented, services provided by veterinarians accomplished, examinations, and furthermore.
• Reproductive Infrastructure: Key factors in small dairying are the availability of laborers, the management of pregnant animals, the location and distance from an AI center, the source of the semen, and the accessibility of semen.
• Source of water, quality of water, if a financial commitment is necessary, determine the type of structure, what amount of cash it is expected to cost, and how much is available for drinking, cleaning, and generating fodder.
• Electrical power: Origin, State Electricity Board (SEB) approval, interconnected load, Issues with electrical failures and generator configurations.
• Advertising of milk and other products would allow dairy farming to be feasible. Factors such as the source of sales, the place of disposal, distance (kilometers), price realized (in rupees per liter of milk), mode of payment, regularity of payment, etc. Sustainable dairying benefits additionally from the utilization of other products and by-products’ like as dung, urine, and milk-based goods.
• Further elements that are required for successful dairy farming encompass record-keeping, biosecurity, sanitation, calf and milking management, and manure disposal.

Potential opportunities associated with the dairy sector:

Some of the most significant possibilities in the Indian dairy sector are: Innovative technologies can help dairy farms improve productivity, efficiency, and profitability. Through the liberalization of the Indian economy, dairy farmers have tremendous possibilities for marketing their products in both the domestic and international marketplaces.

• Milk Production and Related Products:
• Condensed and dried milk, as well as any food items prepared with milk, such as cheese, butter, whipped cream, yogurt, and ice cream. The dairy farmers’ income generation is enhanced due to the add value to their produced milk.
• Cow dung is utilized for a variety of tasks, such as vermicomposting, biogas generation, and agricultural yard manure. Smallholder dairy producers can participate in these initiatives to increase the production of milk and generate more revenue.
• Eco-friendly agricultural systems heavily rely on cow urine-based fertilizers since they increase soil fertility, inhibit pests, and successfully manage ailments. As bio pesticides and fertilizers, compounds are employed in a wide range of agricultural processes. Recently, there are several platforms that allow promotional purposes of cow urine.
• Earthworm species are generally employed in vermicomposting, an organic and biological process that turns organic matter or biodegradable wastes into manure. Vermicomposting is a soil conditioner and nutrient-rich fertilizer. It has been demonstrated to improve plant growth and production in field and greenhouse soils while also inhibiting major horticultural plant pests and diseases.
• One of the most crucial dairying operations that improve the organization’s profitability is the production of fodder. If farmers grow seasonal and perennial fodder crops employing appropriate crop sequences and correctly retain excess green fodder during times of abundance for use during lean times, producers can ensure a year-round supply of fodder. In the current context, dairying and this activity are both recognized as revenue-generating activities.
• Practical obligations of Entities: Better milk quality and quantity in the market are ensured by the formation of new farmer cooperatives to further formalize the dairy sector. Additionally, it will produce additional data that can be utilized for improved resource mobilization and future planning in the dairy industry. For dairy producers, farmer groups such as FPOs, SHGs, and cooperatives can guarantee a better market. The removal of middlemen could guarantee a high-quality product at a reasonable cost. As there are no middlemen who take the profits, marginal farmers also profited from a steady income during lean seasons.
• Production of silage: Silage is pickled feed supposed to keep it fresh for animals to consume during the late summer and early winter months. For livestock, silage products are regarded as a vital source of nutrients and carbohydrates. The quality of the silage is the most important factor that affects animal productivity when consuming animals regardless of the kind of silage.
• Research and extension associated to the dairy sector should be promoted more, covering everything from production to logistics. To more effectively meet the demands of producers and customers, production data analysis and demand analysis should be carried out.
• Strengthen transportation and infrastructure in order to guarantee that milk and milk products are delivered quickly and fresh; more refrigerated automobiles, bulk coolers, and other equipment may be implemented.
• Encourage the establishment of more start-ups and new private dairies in the dairy sector, such as Big Basket, Fresh to Home, and Country Delight. This will break the monopolies of a few major names in the market, stimulate competition, and bring down expenses. The federal and state governments are setting through the necessary initiatives to support startups financially.
• Cooperative banks and other national banks ought to take the lead in supporting the growth of the dairy industry by providing farmers, particularly small and marginal farmers, with significant lending facilities. Through these financial institutions, the governments can support the farmers in the dairy sector by offering subsidies, reasonable prices, and market infrastructures.
• Innovative approaches such as organic dairy farming, dairying in the context of climate change, and entrepreneurship growth are currently developing in India and therefore necessitate appropriate assistance from non-governmental organizations and the government. The producers must receive the support they need in a timely manner in order to satisfy these modern notions.

Dairy Farming in India: A Sustainable Path

Problems and Limitations with the Indian Diary Sector:

In contrast to other dairy-producing territories, India’s dairy industry is unique in that it prioritizes the use of both cow and buffalo milk. It is necessary to improve quality standards in order to boost profitability. The real-world difficulties encountered by Indian dairy producers are described as follows:

• Feed and fodder: A scientific feeding schedule will guarantee sufficient nutrients and, as a result, healthy development of the dairy cattle. The decrease in grazing land has been the primary cause of the feed and fodder shortage. Furthermore, the requirement for feed and fodder increases significantly as a result of infertile animals. Moreover, metabolic problems and mineral deficiency disorders are brought on by a lack of mineral supplements. Increased expenses for feed translate into lower dairy revenues for businesses.

To meet the nutritional requirements of milking dairy cattle, there is a growing demand for high-quality feed and fodder due to the increasing popularity of high-breed animals. There are far too many infertile dairy animals striving with the productive animals for feed and fodder. Due to industrial expansion, grazing lands have been drastically decreasing recently, which has caused a scarcity of feed and fodder. Feed expenses can make up as much as 70% of overall expenditures in conventional dairy production systems. As a result, expensive feeding has an impact on the profitability of dairy production.

India’s Supply and Demand Scenario of Fodder Resources(in Million Tonnes)

Year	Demand		Supply		Deficit		Deficit (%)
	Green	Dry	Green	Dry	Green	Dry	Green	Dry
1995	947	526	379.3	421	568	105	59.95	19.95
2000	988	549	384.5	428	604	121	61.10	21.93
2005	1,025	569	389.9	443	635	126	61.96	22.08
2010	1,061	589	395.2	451	666	138	62.76	23.46
2015	1,097	609	400.6	466	696	143	63.50	23.56
2020	1,134	630	405.9	473	728	157	64.21	24.81
2025*	1,170	650	411.3	488	759	162	64.87	24.92

*Projected supply and demandTableSource: IGFRI Vision 2050

• Buffalo and cattle contract illnesses as the consequence of unhygienic farming procedures. Moreover, this diminishes the quality of milk, resulting in milk and milk products to lose their nutritional value.
• Management regarding illnesses and well-being of animals: The primary challenges falling under the animal welfare category are inadequate veterinary care, a shortage of veterinarian personnel, inappropriate vaccination and deworming, delayed or expensive treatments, and remote veterinary hospitals or dispensaries. All of the aforementioned problems must be resolved for sustainable production. Animal diseases impose a heavy financial strain on farmers. Since it is impossible to document every ailment across each location, it is challenging to give precise estimates of the losses imposed on by the different illnesses. The well-being and production of cattle are adversely affected by the conventional outbreaks of diseases including influenza, Black Quarter infection, and food and mouth disease.
• Reduced output and productivity of Indian dairy animals: The biggest problem facing Indian farmers is a lack of high yielding genetics. Increasing farm animal production is one of the main concerns. Indian cattle produce 1172 kg of milk on average per year, which is only roughly 50% of the world average. India is the world’s most significant producer of milk and has a large population of livestock, but the productivity of dairy animals has been quite low, transforming this valuable asset into a source of contention for the poor.
• For small-holder dairy producers, education and training in scientific dairy farming techniques are essential as well. They must be introduced to several scientific techniques, such as feeding, chaffing, clean milk production, managing the milking calf, the right timing for insemination, etc.
• In order to earn healthy lifestyle choices from milk, India has to reduce the cost of milk production. The low average milk yield of Indian cattle, which is 987 kg/year as opposed to 6273 kg/year in Denmark, 5462 kg/year in the UK, 7038 kg/year in the US, and 11000 kg/year in Israel, is the main consequence of the high cost of milk production.Thus, in addition to superior genetics, this high yield can be attained with appropriate feed, water management, and habitation.
• It is widely acknowledged that the existence of mediators and vendors in the supply chain prevents milk producers from receiving a reasonable price for their product. In India, the unorganized dairy industry accounts for the majority of the dairy industry, despite the efforts of a small number of private dairies and milk cooperatives. Extension services and organized marketing facilities are able to substantially improve the situation.
• Due to the fact the majority of milk and milk products are perishable; the dairy industry is vulnerable to market fluctuation. This means that supply and market demand must be balanced in relation to both local and international markets. Although it is an excellent decision, storing milk indoors to extend its shelf life can be highly expensive for smallholders. The primary characteristic of the dairy business in India is its prevailing lack of organization. Just 18–20% of milk produced in India is employed by the organized industry. The current processing infrastructure still does not incorporate the unorganized sector.
• Within the dairy industry, the main hurdle is to maintain both quantity and quality within a diversified supply base. Although dairy products are perishable, maintaining freshness and safety necessitates more complex supply chain management and logistics. Since 60% of the dairy business operates under informal systems, it is challenging to ensure milk quality and flow on a regular basis. For this reason, milk adulteration continues to constitute prevalent in India.
• Poor technological innovation acceptance amongst dairy farmers in India is also a main concern. Strategies for feeding cattle, such as urea-molasses treatment, silage production, and hay production, have previously been demonstrated to produce high yielding forms of fodder. Unfortunately, most states’ farmers are not utilizing such innovations very well. A lot of technologies need to be highlighted, including artificial insemination, crop residue management, and health care.
• Insufficient revenues are also a main factor. The low milk purchasing costs that milk enterprises offer milk farmers in comparison to the ultimate milk cost in the market continue to be a source of criticism for the farmers. This causes corporations to control the profit market while real producers receive inadequate returns. In addition, unlike other major agricultural commodities in India, milk does not have an MSP (Minimum Support Price), which may help farmers much as they do not receive reasonable prices for their milk and other dairy products.
• Due to poor infrastructure, the dairy sector in India is struggling. In order to ensure good veterinary health care, the National Commission on Agriculture (NCA)-1976 suggested that one veterinary institution be constructed for every 5,000 cattle units (one cattle unit = one cow /one buffalo /ten sheep /ten goats /five pigs /one hundred poultry). There are 67,651 veterinarians in India, while between 1.1 and 1.2 lakh need to be recruited, as reported by Veterinary Council of India.
• The impoverished extension services also contribute to the slow increase in farmers’ incomes.The three components of livestock offerings to farmers include teaching livestock producers, offering technical services to animals, and providing technical inputs. Extension services must prioritize boosting farmers’ capacities in addition to transferring technology and improving a range of infrastructure and support services.
• Farmers’ poor record-keeping and lack of data maintenance also have an impact. Formalization of the industry is further impeded by the informality of the sector, which also results in a lack of statistical analysis on overall milk production, milk waste, and money movements. Additionally, there is a dearth of information about specific farmers.

Conclusion:

The dairy sector contributes an uninterrupted contribution to the formation of relatively low-risk employment opportunities. If these farmers handle their enterprises with science, their production will get better. These farmers must implement competent strategic planning and dairy management approaches in order to assure the highest possible yield and financial gain from their dairy operations.

Dairy farming conveys a wide range of challenges, but it’s important to investigate the prospects as it’s crucial to the sustainability of rural communities in particular. Governments must do everything in their power to assist dairy producers, including offering subsidies, reasonable prices, and market infrastructure.