Crisis in Indian Dairy Sector – What is the way out?

Current Crisis in Indian Dairy Sector – What is the way out?

By:

Vijay Sardana

A few days back, I went to the Dairy Capital of India i.e. Anand, Gujarat to understand the reasons for the current crisis in the dairy sector. The author had interactions with many leading experts in the dairy sector from all aspects of dairying and dairy business.

Unfortunately, I had to come back with many unanswered questions, I thought let me share my queries with you to seek clarification and ideas for the way forward.

As you may be aware, currently, the Indian dairy sector is going through an unprecedented crisis due to various reasons. Rising inventory, falling milk prices, markets are flooded with adulterated dairy products but no action against such companies and loose food safety, labeling and consumer laws promoting analog products (as one expert said, these are fake and cheaper version of dairy products).

Let us do a ground reality check?

The population of India in 2020-21 will be about 1.326 billion. According to RDA -2010 for a moderately active person, the milk requirement is 300 ml per day. At the rate of 300 ml per day per person, India needs about 145 million tons of milk per year. Let us add another 10% i.e. 15 million tons for exports and other applications. The total demand should not exceed about 160 million tons.

National Dairy Plan is proposing 200 million tons milk production. This needs serious evaluation because we have to invest in the production system and natural resources will be under stress.

1.          What is the calculation behind these numbers?

2.          How much feed and fodder is required to produce the 200 million tons of milk?

3.          Do we have land and water to produce this excess quantity of milk?

4.          What will be the environmental impact of excess production?

5.          What will be the impact of the excess production of milk on natural resources and food security of India?

Let us look at some of the hard facts before addressing these vital issues.

How many milking animals do we need?

As of today, 300 million milking animals exist in India:

In order to retain them in milking, we have to produce and manage 300 million additional newborns animals every year. In a country where 200 milking animals are cows, we will be producing 200 million calves every year, and 200 million cows will become old and unproductive. Do we have plans to ensure the shelter, feed, fodder and health care for all these animals? What is the budget allocated for these activities? I am not able to locate in budget documents about funds allocated for this purpose, please help me in locating the right numbers.

If the age of the animal is about 15 years, we may have more animals than the human population in next 10 years or at least equal number of milking animals and human.

Should we relook at review our dairy policy or animal disposal policy? How many stray animals will be on the streets of India and what will be its social and economic impact? I am sure NDRI, ICAR, and NDDB must have done these calculations. These documents should be shared.

Feed and Fodder Requirements must be calculated -

According to NIANP estimates, to produce 160 million tons we will need about 530 million tons of Dry fodder, 880 million tons of green fodder and about 96 million tons of concentrate. With a growing population, how much feed and fodder will be required? Any calculation from NDDB and ICAR may help in better planning.

Land Requirement for Feed and Fodder cultivation should be calculated -

According to current data, dry fodder yield is about 15 tons per hectare, green fodder is about 70 tons per hectare and the concentrate is about 2.5 tons per hectare. After considering the above fact, the land requirement for to produce dry fodder, green fodder and concentrate will be about 80 million hectares of land. Even if we take two crops a year, still 40 million hectare land will be blocked for feed and fodder production. The total land available in India for agriculture cultivation is about 141 million hectare. It means about 30% of the total agriculture land will be blocked only for milk production related activities.

If we assume that National Dairy Plan is targeting 200 million tons of milk production, add another 10 million hectares of land for feed and food requirements. It means according to NDP targets, one-third of the land in India should produce feed and fodder to meet milk production targets.

Pasturelands and other wastelands do not have enough productivity to meet the growing demand for feed and fodder. With growing urbanization and intensive cultivation practices, pasturelands are also shrinking. In agriculturally developed and irrigated states there are no more grazing areas.

Now, the question is – where is the feed and fodder to meet the demand for milk in India?

Who will supply Water for milking animals & stray animals?

Milk production is becoming water-intensive and exhaustive, so there is a strong need for bringing down the water footprint of milk for sustainable dairy farming. The indirect component is the major part, the key role of feed and fodder crops made it a point of check. On the basis of milk output, the water footprints are higher for buffalo than a cow. The average of water use for buffalo milk production is 2000 liter (2 m3/kg).  These high water footprints were due to more water consumption through feed and fodder and comparatively lower yields.

Water consumed per kg of milk is relatively lesser in case of crossbred cow due to their higher productivity. Milk productivity and water footprint per unit of milk yield are inversely correlated.

What is the water requirement per litre of milk for our desi breeds?

The national average of water footprint average is about 1.37m3/kg.

It is important to note that 60 liters of water are consumed to produce a rupee worth of milk output if the farm gate price of milk is about 19 to 20 per litre. It means water must be free to sustain milk production. The per capita availability of water is about 1700 liter per person per day by 2030.

For 200 million tons of milk production, we will need about 400 billion cubic meters of water. The Central Water Commission monitors the live storage of 91 important/major reservoirs, having the capacity at Full Reservoir Level (FRL) of 157.80 billion cubic meters (BCM), which is about 62% of total reservoir capacity in the country.

National Dairy Plan will demand more than the total water in reservoirs in India. Is this logical? Who will ensure water suppliers for dairy production targets?

Livestock methane-emission inventory:

Methane — a greenhouse gas that traps 20 times more heat than carbon dioxide.  In 2009, scientists at the Space Applications Centre in Ahmedabad published a pan-India livestock methane-emission inventory, the first ever, which put the figure at 11.75 million metric tons per year. In 2009, the milk production was 115 million tons. It means, for every 10 million tons of milk production we will have to accept 1 million ton of methane release from milking animals. It is equal to about 20 million tons in Carbon dioxide terms. If NDP is projecting 200 million tons of milk production, we should also gear-up to manage 20 million tons of methane gas production from ruminants.

It means with 200 million tons milk production, we will have 400 millions of Carbon dioxide equivalent.  On the other hand, per capita carbon dioxide emission in India is about 1.8 tons per year i.e. by 2020 it will be, 2.5 billion tons per year. It means 16% of greenhouse gases will come only from milk production. This will not be acceptable under any parameter.

Animal disposal policy:

The cow is a very respected animal for all of us. What should be the procedure to discard dead cows so that it should become issues of social conflict. Is there any policy and infrastructure to ensure that the disposal happens without any social tensions.

The way forward.

It is high time we should look at at all numbers proposed for National Dairy Development Plan for India, keeping in mind that we have limited resources and milk is not the only source of nutrition for citizens. In fact, it is very expensive food for common masses.

There is need to relook at feed formulations, fodder development programs, animal breeding program and dairy farm management issues.

It is high time, leadership is required in dairy industry to give logical direction to Indian dairy industry and to make it relevant for overall development plan of India at the same time to retain global competitiveness.

Dairy farmers are desperately seeking an answer to these questions to save our milk sector. We must find the answer to these questions before many dairy companies become Non-Performing Assets (NPA). Please also note, there are many allied sectors which are based on dairy sector for their survival. They will also suffer - investments and employment, all are at stake. 

Please do share your views on this vital subject.

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