Chapter V PRIVATE SECTOR DAIRY UNITS IN ERNAKULAM DISTRICT

Transcription

1 Chapter V PRIVATE SECTOR DAIRY UNITS IN ERNAKULAM DISTRICT 5.1 Organization of Farmers by Dairy Unit 5.2 People Dairy Development Project (PDDP) Aims and Objectives of PDDP Formation of Local Dairy Societies Collection and Sale of Milk Beneficiary Assistance Programmes 5.3 Nrimalgram Vanitha Dairy Central Society (NVDCS) Dairying for Women Empowerment Collection of Milk Activities of NVDCS 5.4 Jeevodaya Milk Society Formation of Dairy Sanghams and Collection of Milk Charitable Activities Sales Promotion 5.5. Milgram Dairy Development Project Objectives of Milgram Activities of Milgram Milk Procurement Milgram Milk Specialities Private Ltd Govardhini Traders Milgram Farm Care Trust Social Activities Bank Involvement and Credit Facilities Insurance Scheme Milk Products

2 Chapter V PRIVATE SECTOR DAIRY UNITS IN ERNAKULAM DISTRICT INTRODUCTION In Ernakulam district of Kerala State,. there are nine dairy units functioning under the private sector. They are PDDP Milk, Nirmal Milk, Jeeva Milk, Penta Milk, Milgram Milk, Pooja Milk, Gopika Milk, Supreme Milk and Balika Milk. Out of them four are functioning under charitable societies. The charitable societies are organizations registered under the Travancore - Cochin Societies Act, instead of the Co-operative Act, presumably to circumvent some of the restrictive regulations and features of the Cooperative Act. Implied in their incorporation is that they are non-profit organizations whose objectives are social/charitable in nature. In the dairy sector they organize people and present attractive dairy farming packages and motivate people to involve in dairying to attain self sufficiency and overall development of the rural area. 5.1 ORGANIZATION OF FARMERS BY DAIRY UNIT Out of the 9 dairy units in the private sector, only four units viz. People Dairy Development Project, Nirmalgram Vanitha Dairy Central Society, Jeevodaya Milk Society and Milgram organize dairy farmers along co-operative

3 130 line and work for their socio-economic advancement. The other five private sector dairy units collect milk from various places, process them in their plants and market them for achieving profit. Organizing people for their empowerment and economic self sufficiency is not a governing principle for them. The impact they create in the society is difficult to assess because doing service to the society is not their main activity. The aspect of organizing and empowering people is important for the four private sector dairy units functioning as charitable societies. The researcher, therefore, would concentrate the study only on those beneficiaries who are members of these four private sector dairy units. It facilitates to assess clearly the role played by the private sector dairy units in the socio-economic life of their beneficiaries. A brief account of the four private sector dairy units in Ernakulam District are given below: 5.2 PEOPLE DAIRY DEVELOPMENT PROJECT (PDDP) It started functioning in It became a registered society under Travancore-Cochin Societies Act in 1983 and the pasteurization plant was commissioned at Kalady, in A second plant was installed at Chalakudy in 1999, mainly to cater the needs of the diary societies in Trichur District and the two plants together have the capacity to process 50,000 litres of milk per day (30,000 litres for the plant in Kalady and 20,000 litres for the plant in Chalakudy). Now Kalady Plant is processing around 28,000 litres of milk per 1 PDDP Annual Report, 2005, p.2.

4 131 day and Chalakudy plant is processing around 14,000 litres of milk per day. 1 The sales outlet for the Kalady plant are Ernakulam, Idukki, Kottayam and Alappuzha Districts and the sales outlet of Chalakduy plant are Trichur and Palakkad Districts Aims and Objectives of PDDP Its aims and objectives are given below: (a) To impart necessary training, education and leadership for the milk producers union, who works for the betterment of the low income group of society. (b) To initiate unified effort and proper leadership to improve the conditions of the weaker sections of society and thereby to place them above the poverty line. To achieve this aim seminars, conferences and study classes are organized for the dairy farmers. (c) Since milch animals are very important in our economic system, initiatives may be taken to produce high breed bovines and to increase the supply of milk. (d) To provide all assistance to the dairy farmer in areas of artificial insemination and veterinary care. (e) To take proper action to produce and supply quality animal feed for all dairy farmers. (f) To make proper arrangement in the marketing of milk and to give a reasonable price for the dairy farmer for his milk supply. (g) To give information to dairy farmers regarding the existing and emerging problems in the dairy sector.

5 132 (h) To give proper directions and helps to form dairy societies for the dairy farmers who are involved in production and marketing. (i) To accept grants, contributions and technological assistance from personnels, institutions and from government for the proper running of the project. (j) To arrange apt programmes for the socio-economic and cultural growth of rural farmers and to promote self employment to meet the challenge of unemployment in society Formation of Local Dairy Societies PDDP formed dairy Sangams (societies) to carry out its operations efficiently in its functioning areas. Now it has 45,000 members on its rolls who spread in 149 sanghams, spread over two revenue districts of Ernakulam and Trichur. Out of 149 sanghams, 86 are functioning in Ernakulam district and they have 29,800 members on its rolls. 2 The dairy sangham function with set goals and objectives and each sangham elects a five member committee to look after its affairs Collection and Sale of Milk They collect milk directly from the beneficiaries through the collection centres. The price they give to the dairy farmers depends on the SNF and FAT contents of the milk. The current price chart is given in the table Ibid., p.5.

6 Table 5.1 Price Chart of Milk According to Fat and SNF in PDDP Central Society, Kalady X Axis FAT & Y Axis SNF

7

8 Source: PDDP Central Society

9 136 One speciality is that they give the price of the milk to the dairy farmers in terms of kilograms rather than in terms of litres. I t is advantageous for the dairy farmers because one liter of milk is equal to 1.03 kilograms. The dairy farmers, therefore, would get an additional price of 30 grams of milk everytime. Again, a premium of 3 paise per point SNF ie, if the SNF is greater than or equal to per cent is an incentive for the farmers to supply quality milk. The PDDP also follows a penalty to maintain the quality of milk, ie., if the SNF is less than or equal to 4.5 percent, there is a penalty of 10 paise per point. Their sale price of milk is always 50 paise above the price of the milk marketed by Milma in the state Beneficiary Assistance Programmes The PDDP maintains a veterinary centre where there are 6 doctors and 16 livestock assistants. Their helps and services are available at the door step of beneficiaries. They supply feeds to the dairy farmer at a concessional rate. When they purchase cattle feed in bulk quantities from Kerala Feeds, Irinjalakuda, they naturally get a good commission and it is given to the dairy farmers. They organize periodic seminars, group discussions and study classes for dairy farmers to impart information on the modern developments in the dairy sector with the assistance of the officers of the Department of Dairy, Animal Husbandry, Agricultural University and Banks.

10 137 In the personal interaction with the authorities of PDDP the researcher learnt that the co-operative sector milk agency viz. Milma has given only very low price to the dairy farmers in that locality during 1980s. When the PDDP plant was commissioned in 1988, they began to give rather competitive price to the beneficiaries. It prompted milma authorities, too, to increase the procurement price to the beneficiaries. 5.3 NIRMALGRAM VANITHA DAIRY CENTRAL SOCIETY (NVDCS) It was established as a registered charitable organization of rural women in 1991, at Kothamangalam, the eastern part of Ernakulam District. The initiative to form this women s organization was from another nongovernmental organization viz., Nirmalgram Rural Development Project (NRDP), which was involved in the rural development activities in the region since Dairying for Women Empowerment The NVDCS was started with 5 women s dairy societies (sanghams). Now the organization is a confederation of 50 sanghams and with a membership of more than 8,000 rural women. The NVDCS was established to organize the poor rural women, to give them non-formal adult education and to render employment and income for them. Home based mini-dairy units, rearing good quality milch animals and marketing of milk are the major economic activities

11 138 promoted by the organization to generate income for women. Due to the availability of green fodder and possibility of marketing the milk small scale dairying is a feasible and profitable activity that housewives can undertake in the region. The women s dairy societies gave opportunities for women to get organized and involved in social life. They take up responsibilities in their cooperatives. Each sangham has a woman president and a governing council consisting of only women members. Men can support the sanghams in the capacity of advisory committee members. About 100 women secretaries and milk testing assistants are trained to run day-to-day business of the local sanghams. The central society has a Board of Directors and an executive committee for the formation of general policies. The central society has 28 office staff including a veterinary surgeon and three livestock assistants. There is one qualified social worker and 10 field assistants who guide and supervise the organisation of sanghams Collection of Milk Collection of milk is done though collection centres and price of the milk is in accordance with Fat and SNF contents of milk. The price chart is given in the table 5.2.

12 Table 5. 2: Price Chart of Milk According to Fat and SNF by Nirmalgram Vanitha Dairy Central Society, Kothamangalam X Axis FAT & Y Axis SNF

13 Source: Nirmalgram Vanitha Dairy Central Society

14 Activities of NVDCS NVDCS organizes occasional seminars and study classes for women on scientific rearing of milch animals. They assist in obtaining credit facilities through credit unions and commercial banks so that quality milch animals can be purchased easily. The animals are insured with the National Insurance Company. Cattle feed is supplied on credit basis. The mobile veterinary unit gives veterinary services and artificial insemination for the animals at the doorstep of the beneficiaries. The NVDCS has initiated a women s movement in the backward and hilly region. The movement is committed to the cause of the liberation of women to generate awareness on women s issues with national and international perspectives, to create opportunities for women in social and economic fields and to create a just society with respect and equality for women. 5.4 JEEVODAYA MILK SOCIETY It is a project undertaken by Kothamangalam Catholic Diocese. For the overall development of the society, they established High Range Development Centre (HDC) incorporating various developmental activities in the area. Jeevodaya Milk Society is one of its activities, aiming to organize dairy farmers to realize maximum price for the milk they produce and to bring economic development in the area. Their trade name is Jeeva Milk Formation of Dairy Sanghams and Collection of Milk Jeevodaya Milk Society, established in 2001, is an offshoot of Kothamangalam Dairy Society (KDS) started functioning in The KDS

15 142 firstly concentrated in collecting milk from various households and marketed them to different agencies and thereby they opened a marketing network for the dairy farmers. In 2001, they started a pasteurization plant at Pareekunny, near Kothamangalam, and began to form Dairy Sanghams. At present they have 85 sanghams spread over Ernakulam and Idukki Districts of which 62 are functioning in Ernakulam District, and the rest in Idukki District mainly in the border area of Ernakulam District. In 62 sanghams there exist 6720 members. They collect and supply nearly 10,000 litres of milk per day and its plant has the capacity of litres per day. 3 The price given to the dairy farmers are based on SNF and FAT and its details are given in the table Jeeva Milk Annual Report, 2005, p. 2.

16 Table 5.3: Price Chart of Milk to Beneficiaries According to FAT and SNF by Jeevodaya Milk Project CLR FAT SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE

17 CLR FAT SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE Source: Jeevodaya Milk Society

18 Charitable Activities Jeevodaya Milk Society (JMS) is registered under the Travancore - Cochin Societies Act, and its purpose is charitable in nature. They try to organise dairy farmers in order to realize a substantial income for their work. The JMS is committed in the overall development of the society and they conduct social awareness programmes and community empowerment programmes for the beneficiaries and try to create a saving habit among the beneficiaries to meet unforeseen contingencies in life. The profit earned by the society is meant for distribution among beneficiaries Sales Promotion The sales promotion activities through media are not adopted by the society due to the lack of sufficient funds. Their main strategy is personal contact strategy. They personally meet different institutions and make contract to supply milk regularly to them. These include big hotels, hospitals, educational institutions, boarding houses and sweet houses. Though they sell milk packets in retail shops, a major portion of their milk is sold to big institutions in Ernakulam and Kottayam Districts. In general Jeeva Milk and other jeeva products have attained high opinion regarding the quality and consumer acceptability in central Kerala. Now they are in the process of getting ISO Certification, which boosts the image and quality of the products. 5.5 MILGRAM DAIRY DEVELOPMENT PROJECT Milgram, existing in Pazhanganad, Ernakulam District, is a standing testimony of human endeavour and understanding. It is the success story of a

19 146 co-operative effort. It believes in co-existance through co-operation. The vision of milgram is to grow with people consistently. Its moto is to be the cause of a White Revolution in our neighbourhood. 4 It started functioning in 1970 and the setting up of dairy units was launched in It has a pasturization plant with the capacity of 50,000 litres per day The Objectives of Milgram a. To produce the milk required for our state and to reduce reliance on milk brought from other states. b. To bring to the market quality milk, free from any adulteration. c. To procure the milk from the rural neighbourhood and thereby bringing about a social upliftment of the weaker section and to make them financially self reliant. d. To emerge as the market leader in the production of milk and milk products in the state. e. To evolve a profitable dairy business and to be a cause for the nation s development Activities of Milgram Milk Procurement It has three sources for procuring the milk viz. society units/ franchisees, own farm and outside purchase. They have 30 societies and 10 franchisees. The procurement is made two times in a day. Milk procured at 4 Milgram Annual Report, 2005, p. 1.

20 147 the society undergoes strict quality check before transporting them to the processing plant. It supplies quality milk in and around Ernakulam District Milgram Milk Specialities Private Limited It is a private limited company started in 1998 with modern ice cream manufacturing machineries incorporated. The ice cream plant has an installed capacity of 1000 litres per day. Its ice creams are marketed under the brand name Milgram - Scoop It Up Govardhini Traders It is a trading house that deals with the supply of all the feed to the farmers and franchisees of Milgram. They identify Govardhini Traders as a potential entity for development because the feed requirement of dairy farmers is enormous. The dairy unit provides to feed the farmers at a lower profit margin on account of their ability to initiate bulk purchases at reduced rates Milgram Farm Care Trust It is a trust created for charitable purposes. A veterinary centre by the name Milgram Veterinary Centre with experts from the College of Veterinary and Animal Sciences is functioning under this trust. The services of 2 veterinary doctors and 8 livestock Inspectors are available at the centre round the clock Social Activities Milgram is committed to involve in various social service activities too. Collection of milk is undertaken from the dairy farmers farm house at

21 148 prevalent prices. It initiates an agricultural loan scheme for the farmers who do both dairying and farming in tie-up with Bank of India. Assistance is provided for setting up of cost effective farm sheds and purchase of cows. It undertakes the supply of cattle feed and medicine for member farmers on credit basis. Milgram has appointed dedicated staff including those qualified in social works to provide the needed impetus to the development of society units/ franchisees. They organize various training programmes for the assistance of farmers. It initiated development schemes by joining hands with various Panchayat and Kudumbasree units. Special attention and emphasis are laid upon the schemes for the upliftment of women in rural areas. The Milgram team disseminates information on new developments in the area of dairy farming and on various possibilities of making dairy farming a more profitable venture. Apart from organizing meetings and seminars for the benefit of milk farmers it promotes recreational activities for the betterment of the rural cult Bank Involvement and Credit Facilities Milgram family is banking with Bank of India for realizing a White Revolution. The milgram acts as the link between the bank and numerous farmers who have obtained loan from the bank. The modus operandi of the loan scheme of Bank of India in respect of loan to individual farmers is explained below. (a) Milgram authorities target specific areas and identify potential farmers for the scheme. (b) Bank of India jointly with Milgram authorities appraises each farmer s loan application as a pre-sanction procedure.

22 149 (c) The total investment required by individual farmer is assessed and the major issues including the manner of disbursement and compliance of procedures regarding the loan are determined. (d) A tripartite agreement is executed among Milgram, individual farmers and the bank whereby the farmers agree to route the milk produced through the collection centres of Milgram and Milgram, in turn, will route the proceeds through Bank of India so that the installments due towards the individual loan of farmers can be realized by bank and balance proceeds credited to the farmer s account Insurance Scheme The milch animals are examined by veterinary doctors of Milgram and they are insured along with personal accident cover for the farmers. Due to the collective bargaining power from the side of Milgram, they are bringing the premium rate to as low as 5.25% while the prevailing industry rate touched around 12.75%. The insurance plan of Milgram for dairy farmers comes with an accident death policy of Rs. 1 lakhs, accident - mediclaim policy of Rs. 25,000/- and mediclaim policy of Rs. 10,000/-. Veterinary care is provided to the animals through the Milgram Farm Care Trust and supply of feed at reasonable rates on credit basis through M/s. Govardhani Traders Milk Products Today milgram is collecting daily litres of milk from the farmers spread over 48 sanghams. Price chart is given in the table 5.4.

23 150 CLR FAT SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE Table 5.4: Price Chart of Milk According to Fat and SNF by Milgram Dairy Development Project, Pazhanganad

24 151 CLR FAT SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE

25 152 CLR FAT SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE SNF RATE Source: Milgram Dairy Development Project

26 153 The processing facility of Milgram is under-utilized today on account of the gap in the demand and supply position of milk. To ensure cent per cent capacity utilization of the processing facility, the need of the hour is to ensure adequate milk collection by bringing more farmers under the fold of Milgram. Loan arrangement envisaged with Union Bank of India will attract more dairy farmers and this may solve the crisis of the scarcity of milk production at present. Conclusion The involvement of private sector in the field of dairying makes the sector more competitive and efficient. The private sector units challenge the co-opeartive agency Milma in quality of milk supplied to the consumers, incentives given to the dairy farmers, provision of reasonable price for milk, subsidized supply of feed and fodder etc. The private sector dairy units attract the ordinary farmers through their incentive packages which promote the economic development of the weaker sections in the interior villages of Ernakulam District.