COVID-19 Challenges to Dairy Industries in INDIA

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Smita Patil1, Sudhanya Nath2
1. Ph.D. Scholar at Livestock Production Management Department, WBUAFS, Kolkata, (W.B.)
2. Ph.D. Scholar, Department of Nutrition, WBUAFS, (W.B.)

1 – Corresponding Author – smita.patil9146@gmail.com

Introduction:

India has been the leading producer and consumer of dairy products worldwide since 1998 with a sustained growth in the availability of milk and milk products. COVID-19 has affected the lives and livelihoods of millions across the world. More than 70 per cent of milk is being produced by small farmers; milk provides immediate cash for their livelihood. These small farmers are worst hit due to lower demand and consequently no/partial procurement. The major share of milk is handled by the unorganised sector comprising milkmen, milk contractors, halwai shops/ creameries/city-based private dairy shops etc., while only 30 per cent is handled by the organised sector dairy cooperatives and private milk plants. Milk is a perishable product and it can’t be stored without proper processing. That is why reports of dumping of fresh milk by farmers are coming in from different parts of the world. In the Indian dairy sector, milk is collected twice a day (morning and evening). The government of India consider reducing GST, 12% to 5% on ghee and milk fat. With the drop in milk demand, the sale of dairy products, particularly value-added products, has also gone down. Private plants which are mainly involved in the production of value-added dairy products are witnessing a major liquidity crisis. It’s tough for dairies around the country to handle a surge in fresh milk supply on the one hand and a concurrent major drop in demand for milk and milk products on the other.

Benefits:

• Covid-19 could benefit the dairy industry as consumers could shift from meat-based to dairy-based protein. The govt may consider reducing GST on ghee and milk fat from 12% to 5% .
• Indian dairy industry has proved to be more resilient than many other sectors in terms of the extent of supply chain disruptions.
• India may consider reducing GST on ghee and milk fat, from 12% to 5% to bring it at par with the GST rate for SMP. This has been a long-standing demand of the dairy industry and will ultimately benefit milk producers, increase rural incomes, spur demand and hasten economic recovery.
• During these difficult times of the dairy farmers, our cows and buffaloes must be taken care of, as any compromise on their feeding and health care would impact reproductive efficiency and productivity. Both governments and dairy cooperatives should provide these inputs and services to the farmers on subsidised rates or deferred payments basis. The country cannot afford to go through another phase of supply disruption resulting in pressures on availability and prices of milk.
• The government can streamline doorstep delivery of milk. It can consider allowing the opening of halwai shops/creameries for a few hours daily, provided social distancing norms are observed.

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Losses:

1. The virus has major losses to dairy farmers in a number of ways, the first being management of dairy animals and second the marketing and sale of milk and other by-products.
2. National Dairy Development Board (NDDB) from the dairy cooperatives (see graphic) shows a decline in daily liquid milk sales by dairy cooperatives by about 15% in the Covid-19 lockdown period between March 1-15 and April 8-14, and a drop in the proportion of sales to procurement by about 8.8% during the same period.
3. During the initial phases of the lockdown restrictions, both milk procurement and sales of milk were impacted in several parts of the country due to supply chain disruptions.
4. During lockdown period it’s tough for dairies around the country to handle a surge in fresh milk supply on the one hand and a concurrent major drop in demand for milk and milk products on the other.
5. All eateries and sweet shops are closed, leading to low demand for milk and other dairy products.
6. Due to the liquidity crisis and limitation of working capital, dairy plants cannot afford to manage delivery of surplus milk.
7. Dairy farmers are finding it difficult to dispose of their milk. Some milk plants are accepting the milk from farmers on the condition of deferred payment. Prices of milk have fallen, putting further stress on farmers.
8. During whole shutdown in the country. There is a fall in milk prices and farmers may be disposing the milk at a price lower than the cost of production.
9. Difficulties are also arising in fixing milk prices.

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Preventive measure for milk vendors:

• Milk handler should wear gloves as well mask while selling milk. Gloves are not substitute for hand washing and frequent hand washing is mandatory.
• Hand sanitizer should be used while supplying milk from one customer to another.
• Milk collected should be filtered immediately with clean cloth and must be kept covered in cold areas.
• If milk is to be sold in loose condition, it should be transported at earliest to consumer/retail market in covered containers and under cold conditions. Otherwise, if packing facilities exists, packing and selling of packed milk should be encouraged.
• Use long handle milk measuring ladle and touch it only after sanitizing hands if in-between you have touched anything else.
• Keep a safe distance from other i.e. more than 6 feet and wear full sleeve clothe.
• Remove the clothes immediately after coming home and wash them.
• Take bath before interacting with any family member especially elderly and children.
• Remove the shoes outside house and keep them separate.
• Do not involve in milking or milk processing if feeling sick.
• If possible go for online transaction and avoid cash payments.
• Remove gloves and mask appropriately and discard them safely. Homemade masks should be washed daily before use.
• Schedule milk delivery in such a way that there is minimum human contact, like delivering to an area once in two days.
• Delivery of milk and milk products without human contact should be done by leaving the product at door or maintain a gap of at least 6 feet.
• Contact with common touch points such as door bell, door handle etc. should be avoided and if touched hands should be sanitized thoroughly.
• At the sale counter, wear the mask and hand gloves and ask the customers to maintain social distance.
• If vehicle used for delivering milk or milk products entered an area marked as hotspot, it should be thoroughly clean before another use.

Conversion of surplus milk into value added products:

• In case of unutilized/surplus milk, following steps are suggested. Farmers may adopt the best suitable ways to utilize the unsold milk.
• Whole Milk may be fermented using locally available starter cultures. It can be utilized for Ghee production and the by-product- Butter milk can also be packed and sold. The unsold butter milk may be fed to calves.
• Cream can be separated and may be utilized for butter making (if facilities exists) otherwise use it for Ghee production. The by-product- Skim milk can be fermented for curd/lassie or may be used for flavored milk production or it may be fed to calves if remains unutilized or casein can be prepared to sale later on.
• Milk may also be concentrated to make khoa and khoa-based dairy products.
• Kulfee or other frozen dairy products may also be prepared depending upon skills available with farming families.
• Curd may be prepared and sold.
• Khoa can be prepared by desiccating the milk, which can be sold as such or can be used to prepare the khoa-based dairy products.
• Dairy farmers and plants can convert milk into ghee and other products which have a longer shelf life.
• Some institutions convert milk into skimmed milk powder (SMP) and milk fat by direct procurement of surplus milk for conversion and direct distribution to needy people.

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(Source- 1. ICAR – IVRI, Advisory for Livestock Owners during COVID – 19 Lockdown)

Conclusion:

Dairy activities form an essential part of the rural Indian economy, serving as an important source of employment and income. India also has the largest bovine population in the world. However, the milk production per animal is significantly low as compared to the other major dairy producers. Moreover, nearly all of the dairy produce in India is consumed domestically, with the majority of it being sold as fluid milk. So in this difficult time we must follow all suitable preventive measure to stop COVID-19. On account of this, the Indian dairy industry holds tremendous potential for value-addition and overall development. According to the latest report by IMARC Group, titled “Dairy Industry in India 2020 Edition: Market Size, Growth, Prices, Segments, Cooperatives, Private Dairies, Procurement and Distribution”, the dairy market in India reached a value of INR 10,527 Billion in 2019, so keeping this in mind we should have to go ahead in this tough time.

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