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How to Start Manufacturing of Dairy Product in India


Overview: Dairy Products

India is a largely agrarian economy and has been since Vedic times because of its deep ties to agriculture and nature. In India, the dairy sector is a thriving agrarian-based enterprise that helps feed millions. In fact, India's dairy industry accounts for 4% of the country's GDP. Dairy farming is a valuable industry in India since milk and other dairy products have a year-round market. We Indians consume a lot of dairy products, whether it's a hot cup of coffee in the morning or kheer for Sunday lunch. People who desire to employ current technologies while remaining connected to nature would enjoy the dairy business. As a result, in India, the dairy industry serves as a vehicle for socio-economic development. This is why the Indian government has introduced a number of schemes, loans, and fiscal initiatives to assist dairy farmers.

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Securing a Dairy Farm Loan

A dairy farm loan can help you start and operate your farm, as well as make adjustments. Obtaining a dairy farm loan can also assist in the establishment of new units to produce, process, and distribute additional dairy or milk products. It also assists in covering expenditures such as raw material acquisition, storage, processing, and packaging, as well as costs associated with the growth and care of farm animals.

Benefits of Starting a Dairy Business:

1. Low initial investment in comparison to other industries

The dairy business has a lower capital intensity than other industries. The biggest expense is purchasing the cattle, however, you are eligible for numerous government incentives and subsidies. It also doesn't require much in the way of infrastructure, as all you need is a shed to house the cattle.

2. Rising Demand

Dairy products are evergreen in the sense that they never go out of style. They are in high demand throughout the year, so you won't have to worry about a lack of demand during particular periods. In addition, because milk is so healthy, demand for high-quality dairy products is increasing in India.

3. Ease of Marketing Due to Milk Producers’ Societies

Dairy farms do not require much independent marketing because they are traditional companies. Furthermore, organisations like MPCS assist dairy farms in India with marketing, allowing them to save money and easily attract new clients.

4. Animal Insurance

The government is particularly supportive of the dairy business because it aids in socio-economic development. As a result, they have enabled dairy farmers to ensure their animals in order to reduce risk and increase profit. Farmers can better control their risks and avoid major problems that can develop if a large number of their animals become ill or die.

5. Alternate Uses

Animals on dairy farms in India are used for a variety of functions. The cattle's dung aids in the generation of biogas, while their manure is necessary for agriculture. It can also be used for vermicomposting and fish feed. As a result, they do much more than just produce milk, assisting farmers in monetizing their products in many ways to increase their profit margins.

6. Eco-friendly and Clean

Dairy farming in India is an environmentally beneficial and clean enterprise when done correctly. If farmers solely utilize natural products, the industry can support a wide range of other agrarian-based businesses.

7. Easy to Set-Up

Unlike other businesses, the dairy industry does not require a lot of high-skilled labour. Because the majority of the work is manual, a dairy farm does not require a large number of highly skilled workers. As a result, Indian households can band together to start their own small-scale dairy farms, making it a very viable business option.

Why You Should Invest In the Dairy Business

Dairy farming is commonly referred to as an "all-season opportunity" because milk and milk products are in constant demand in India and around the world. The company requires 14 to 18 hours every day. India's milk production is consistently high, increasing by 3% to 4% per year.

For all of these reasons, dairy farming is becoming a lucrative sector for entrepreneurs. Dairy farming requires a lot of labour, time, and money. Cleaning the farm, managing sheds, feeding the cattle, and even washing and milking the animals are among the many tasks that come with them.

How Can Someone Start His Own Dairy Business?

The market of Dairy Business India

So, if you're going to establish a dairy business, who are your target customers? To discover the many categories of best-selling dairy products, researchers must look at income groups, geography, and whether households are nuclear or joint. Also, pertinent questions such as a dairy farm for cows or a dairy for buffalos would lead to a research of market consumption patterns and demand. The fat content of buffalo milk is higher than that of cow milk.

Many Indian families boil milk despite it being pasteurised in order to extract the 'Malai' from it and make ghee at home. This is cost-effective, with the extra benefit of eating ghee prepared from scratch. However, there are locations in India where nuclear families exist in big numbers and have a lot of disposable cash. These families will prefer low-fat milk and will be able to afford premium cow milk. Again, places in India with a larger population density of children under the age of ten will have a higher demand for category A2 desi cow milk, which is easier to digest.

How to Start Dairy Business in India?

Let's have a look at what makes up a Dairy Firm Plan. The introduction describes the nature of the business, its scope and objectives, the major issues, and the financial overview. The company's mission, vision, and objectives include dairy business goals such as creating the highest quality milk or products or ensuring customer happiness through providing value for money.

Details about the company's location and history: It usually contains information about the company's location in a certain region. Details about the location should be supplied, whether it is owned, rented, or leased. Details about the livestock and farm, as well as more information on the equipment: Data on the total number of animals used in the business, as well as the various types of equipment purchased and their billing information, is also crucial.

The strategy must include all information on various business proposals, marketing plans, advertisements, new investments to be made, and details of brand campaigns. The plan's execution should include business plans for its implementation and management, as well as anticipated dates for completion. To establish this firm, you'll need a five-year forecast of goals, as well as yearly analysis and practical facts, as well as specifics on all of the permissions and licences.

Business Plan

So, let's take a look at the components of the dairy farming business that should be used both before and after the firm is started:

  • Land: Farm owners are obligated to maintain cultivated fields or land in order to produce fodder yields for the livestock. Its size is determined by the total number of animals kept. In most cases, one acre of land is enough to feed 7 to 10 cows.
  • Cattle of the specified breed and vaccination:  Cattle breeds must be carefully chosen in order to provide more milk. A regular vaccination schedule must be followed for disease management and health protection of cattle.
  • Shed: It is a covered area in the farmland to be built before taking in cattle; this is where the cattle are to be kept.
  • Cattle fodder and water: These are to be kept in abundance, as water is required for the growth of green fodder and cattle nourishment.

Which Animal to Select Cow or Buffalo?

Good-quality cows cost between Rs.1500 and Rs.2000 per litre of milk produced per day. Cows reproduce frequently, giving birth to one calf every 13-14 months. They are easier to control since they are more docile. The Indian environment has adapted well to Holstein and Jersey crosses. Cow milk has a lower fat percentage than buffalo milk. Murrah and Mehsana buffalo breeds are popular in India. For the production of butter and butter oil, buffalo milk has more requirements (Ghee).

Tea made with buffalo milk is very popular. Buffaloes can also be raised on coarser crop wastes, lowering feed costs. A cooling facility is required for buffaloes. A dairy farm should include at least 20 animals, such as 10 cows and ten buffaloes, according to the Indian condition. This strength can comfortably support 100 acooperative50:50 or 40:60 ratio. Following that, you must assess your strengths and market potential.

Dairy Business in India- The Legal Requirement

It varies by state, depending on whether the company also plans to process milk and produce goods. The local area veterinary and dairy development department is the initial point of contact for a typical individual dairy farm. No other government agency needs to be contacted if your farm is a recognised dairy cooperative society. Veterinary or allied officers of the municipality, corporation, or local panchayat issue the licence. If it's a large farm, the pollution control board may need to be consulted. In the case of a dairy farm, the standards are BIS (BUREAU OF INDIAN STANDARDS).

How Can I Get Dairy Loan in India

Subsidy of up to 33% on loans up to Rs. 7 lakh for the establishment of a dairy farm. The National Bank for Agriculture and Rural Development (NABARD) launched a subsidy programme called the Dairy Entrepreneurship Development Scheme (DEDS), which allows farmers to earn subsidies on dairy farming loans from recognised banks.

Farmers who visit designated Regional Rural Banks can earn a 33.33 per cent rebate on dairy farming loans up to Rs. 7 lakh (RRBs). Alternatively, there are commercial and cooperative banks. Applicants can also obtain essential information on subsidies and loan facilities from the representative of the local bank.

(Note: Maintaining a cow farm is no easy task. However, with enough zeal and technology, it is possible to make money. We should be prepared for a few obstacles, such as cattle reproduction and the availability of milk, both of which are dependent on nature and are occasionally beyond our control. Managers that are alert, industrious, and accountable can accomplish miracles. Every step of the manufacturing process requires quality control.)

This portion of the site is for informational purposes only. The content is not legal advice. The statements and opinions are the expression of author, not corpseed, and have not been evaluated by corpseed for accuracy, completeness, or changes in the law.


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I have worked for many internet blog pages and news portals. currently, I am working as a content writer for Corpseed Pvt. Ltd. I like to write blogs and articles in the field of different services.

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