Chapter IV LIVESTOCK AND DAIRY SECTOR : A STATISTICAL PROFILE

Chapter IV LIVESTOCK AND DAIRY SECTOR : A STATISTICAL PROFILE 4.1 Indian Scenario 4.1.1 Trend in Livestock Population 4.1.2 Milk Production 4.1.3 Feed and Fodder Base 4.1.4 Trend in the Production of Livestock Products 4.1.5 Animal Health Care 4.1.6 Breeding Support 4.1.7 Import and Export of Milk and Milk Products 4.2 Kerala Scenario 4.2.1 Livestock Population 4.2.2 Milk Production 4.2.3 Breeding Support 4.2.4 Cattle Feed 4.2.5 Production of Fodder 4.2.6 Better Management of Younger Calves 4.2.7 Kamadhenu Insurance Scheme 4.2.8 Milk Marketing 4.2.9 Pricing Pattern of Milk

Chapter IV LIVESTOCK AND DAIRY SECTOR : A STATISTICAL PROFILE INTRODUCTION In India the dairy sector is a fast growing sector of the economy. An analysis of trends over the last two decades indicates that growth in this sector has far exceeded the growth in cereal production mainly due to rapid urbanization, rise in levels of income and less proportional growth in the prices of livestock products. The growth of the sector implies far reaching results in rural India in poverty alleviation and in improving the health status of rural people. This chapter highlights the dairy scenario of India, in general, and of Kerala in particular. 4.1 INDIAN SCENARIO 4.1.1 Trend in Livestock Population As per the figures of 2003 livestock census, India has 187.38 million cattle population which is about 15 per cent of the world cattle population. 1 Out of the 187.38 million cattle population, 22.63 million are crossbred, which is 12.07 per cent of the total cattle population. Between 1997 and 2003 1 Economic Review 2004, State Planning Board, Thiruvanathapuram, 2005, p.74.

98 crossbred population increased by 12.6 per cent. The states of Tamil Nadu, Maharastra, Kerala, Uttar Pradesh, Karnataka and Punjab account for about 60 per cent of the crossbred cattle population. The country has 96.62 million buffalo population which is about 56 per cent of the world buffalo population. Between 1997 and 2003 the buffalo population increased by 7.5 percent. Inspite of India s position as the highest producer of milk, productivity per animal is rather low. It is only 987 Kgs/lactation as compared to the world average of 2038 Kgs/lactation. This is mainly due to the poor level of nutrition as well as low genetic potential for milk production and health care. 4.1.2 Milk Production India is currently the largest producer of milk in the world, producing approximately 91.1 million tonnes of milk. The following table highlights the gradual increase of milk production from 1993 to 2004. Table 4.1 : Yearwise Production of Milk in India from 1993 to 2004 Milk Production in India Year Milk (Million tonnes) 1993-94 60.6 1994-95 63.8 1995-96 66.3 1996-97 68.3 1997-98 70.5 1998-99 75.2 1999-00 78.1 2000-01 81.0 2001-02 84.8 2002-03 87.3 2003-04 91.1 Source: Economic Review 2002, pp. 70-71. Economic Review 2004, p.80.

99 The table shows, that there is a gradual increase in the production of milk in the national level. This is mainly because of the various dairy development programes initiated by the Central and State Governments during the Operation Flood. 4.1.3 Feed and Fodder Base There is an alarming gap between demand and supply of feed and fodder in the country. The National Commission on Agriculture (1976) has estimated the demand of fodder in the country for the year 2000 A.D at 256.8 million tonnes dry fodder and 575 million tonnes green fodder. The future scenario of demand and supply position, as shown in the Tenth Plan Working Group Report of the Planning Commission on Animal Husbandry and Dairying, reveals a huge deficit of green fodder in the country in the near future. The available fodder can meet the demand of only 46.7 per cent of the total livestock. 2 Estimated demand and supply of green and dry fodder in the country is given in the following table. 2 Ibid., p. 76.

100 Table 4.2 : Estimated Supply and Demand of Green and Dry Fodder from 1995 to 2025 Supply Demand Deficit as Percentage of Demand Year Green Dry Green Dry Green Dry 1995 379.3 421 947 526 59.95 19.95 2000 384.5 428 988 549 61.10 21.93 2005 389.9 443 1025 569 61.96 22.08 2010 395.2 451 1061 589 62.76 23.46 2015 400.6 466 1097 609 63.50 23.56 2020 405.9 473 1134 630 64.21 24.81 2025 411.3 488 1170 650 64.87 24.92 Source: Economic Review 2004, p. 77. The projected gap between demand and supply of green and dry fodder invites an attention to frame perspective planning, time bound strategies, and concerted efforts to meet this challenge. 4.1.4 Trend in the Production of Livestock Products As per Centre for Statistical Organization (CSO) estimates the value of output from livestock sector to Indian economy during 2001-02 contributes Rs. 150240 crores, which is about 23.65 percentage of the value of output of Rs. 635395 crores from agriculture and allied sectors. A comparison of the contribution of livestock sub sector to GDP over the period 1980-81 to 1999-2000 shows steady increase from Rs. 59 billion to 984 billion. 3 3. Ibid., p. 78.

101 As per a study conducted by National Dairy Development Board, based on the production of milk in 1999, of the total milk produced 45 per cent is consumed as liquid milk followed by ghee (28 per cent) butter (6 per cent) dahi (7 per cent) and milk powder (2.6 per cent). In general, the monthly private consumption expenditure on milk and milk products is next to cereals and is rising steadily over the years. Milk and milk products are both income and price elastic in India and the demand elasticity estimates of the Indian dairy industry for milk and milk products combined are 1.65 in rural and 1.15 in urban India. 4 Thus rising income will maintain a high demand growth in dairy sector. 4.1.5 Animal Health Care With the introduction of extensive cross breeding programmes and improvement of quality of cross bred cattle, the susceptibility of these to various diseases has increased. In order to reduce morbidity and mortality, a network of 26,540 polyclinics/hospitals/dispensaries and 25,430 veterinary and centres supported by 250 disease diagnostic laboratories are functioning in the country. These institutions employ 36000 professional staff and over 70,000 para veterinarians. 5 For the production of vaccines there are 26 veterinary vaccine production units. The limited emphasis on preventive services 4 Ibid., p. 78. 5 Ibid., p. 84.

102 contributes to India s inability to eradicate animal epidemics which limits the country s competitive advantage in the global market. During the tenth Five Year Plan Government of India has initiated central assistance to States and Union Territories for controlling various animal diseases through certain schemes. They include Assistance to States for Control of Animal Diseases (ASCAD), National Project on Rinderpest Erradication (NPRE) and Foot and Mouth Disease Control Programme (FMD-CP) 4.1.6 Breeding Support Regarding breeding infrastructure India is the largest in the world with 64 frozen semen bull stations and more than 54,000 artificial insemination centres. Artificial insemination conducted in the country increased from 20 million in 1999-2000 to 28 million in 2003-2004. Due to poor quality semen produced by most of the semen stations in the country, the conception rate ranges from 20 per cent to 45 per cent only whereas in the developed countries the rate is more than 50 per cent. By the end of 2000 there were about 4.2 artificial insemination centres/10000 breedable bovines in the country with Kerala appearing on the top of the list with 10.3 artificial insemination centres. 6 6. Ibid., p. 86.

103 4.1.7 Import and Export of Milk and Milk Products The Export of Milk Products Rule (Quality control, Inspection and Monitoring ) 2000, sets out the requirements related to quality of milk products destined for export and mechanisms to ensure pre shipment inspection as well as approval of establishment for export. Quality requirements include animal health at farm level and hygiene requirements at farm, collection centre, processing establishments, storage and transportation. At the end of March, 1993, 38 establishments had obtained certification from the authority for undertaking exports. Government of India has amended the Livestock Importation Act, 1998, under which import of all livestock products are allowed against Sanitary Import Permits (SIP) which are issued after conducting risk analysis with regard to the disease status of the exporting country in accordance with the international scientific principles. The number of Sanitary Import Permits issued are 218 in 2001, 1002 in 2002 and 1514 in 2003. 7 Details of exports and imports of milk and milk products from India are given in the following table. 7 Ibid., p. 83.

104 Table 4.3: Export and Import of Dairy Products Category 2000-01 2001-02 ( 000 MT ) Exports Skimmed milk powder 7.3 14.4 Whole milk powder 1.5 2.1 Other milk powder 1.0 1.5 Butter 0.1 0.2 Butter oil/melted butter 1.0 1.5 Imports Skimmed milk powder 0 0.6 Butter oil 1 3.2 Source: Economic Review 2004, p. 83. The above data revealed that there is an increase in the export of milk products from 2000 to 2002. The export of the skimmed milk powder was doubled and in all other categories we observe an increase in quantity. With regard to import high rate of increase was noted in butter oil. Another observation is that skimmed milk powder export has almost doubled in 2001-02 from the previous year and increase occured in imports is rather marginal. But in the case of butter oil import has increased more than 200 per cent and export has increased only by 50 per cent.. 4.2 KERALA SCENARIO Livestock sector plays an important role in the economy of Kerala because in rural parts of Kerala it helps to overcome poverty and unemployment

105 to a great extent. It ensures a regular flow of income to weaker section of population. The efforts of Kerala Government and other non-government organizations to enhance dairy sector through various programmes are noteworthy. 4.2.1 Livestock Population Kerala accounts for 1.13 per cent of the total cattle population in the country. 8 The total live stock population as per the 2000 livestock census is 42,93,925 as against 55,76,917 in the 1996 livestock census, which makes a decrease of 23.01 per cent. The main species of livestock found in the state of Kerala are cows, buffaloes, goats and pigs. Out of the total livestock, 58.01 per cent are cows, 2.60 per cent buffaloes, 37.22 per cent goats and 2.05 per cent pigs. Trichur District ranks first, holding the largest number of livestock followed by Palakkad District and Wayanad District ranks last. 9 The cattle population as per the 2000 census is 24,90,707, which indicates a decrease of 26.76 per cent from the 1996 census figure. The cattle population of the state comprises of 22,75,569 females (91.36 per cent) and 2,15,138 males. This means that sex ratio is 10,557 females for 1000 males. Another significant factor is that out of the total cattle, 61.13 per cent are adult females. Again, 78.59 per cent of cattle population are crossbred cattle. Among the crossbred cattle, 92.64 per cent are females out of which 65.18 8 Ibid., p. 75. 9 Livestock Census 2000, Directorate of Animal Husbandry, Trivandrum, p.5.

106 per cent are adult cows and 41.69 per cent are lactating cows. The indigeneous cattle population has decreased by 52 per cent from the year 1996. In the indigeneous cattle population 86.68 per cent are females out of which 73.67 per cent are adults and 42.32 per cent are lactating cows. The buffalo population in the state as per 2000 census is 1,11,465 as against 1,65,125 in the last census. Thus, there has been a decrease of 32.50 per cent during the period. Of the total buffaloes, 48.84 per cent are females of which 58.57 per cent are adults and 63.98 per cent are lactating buffaloes. The following table highlights the growth of cattle population in Kerala during 1996-2000. * Table 4.4: Distribution of Cattle Population in Kerala in 1996 and in 2000. No Category 1996 2000 Percentage of Variation 1 Total crossbred males 231781 144093-37.83 2 Total crossbred females 2055095 1813264-11.77 3 Total indigeneous males 152282 71045-53.35 4 Total indigeneous females 957177 462305-51.70 5 Total crossbred cattle (1+2) 2286876 1957357-14.41 6 Total indigeneous cattle (3+4) 1109459 533350-51.93 7 Total cattle population (5+6) 3396335 2490707-26.66 Source: Livestock Census, 2000, p. 8. There is a decrease in the number of cattle population, both indigeneous and crossbred, in the state. The high decrease is noted in the case of indigeneous cattle and low rate of decrease is observed in the case of crossbred females. * While explaining the milk production of Kerala in Table 4.7 [P. 109] the reason for the decrease is explained sufficiently.

107 In Kerala we observe a great attraction to crossbred cattle in the last few years. The result of the popular crossbreeding technology can be noted from the following table. Table 4.5 : Distribution of Crossbred Cattle Population in Kerala, in 1996 and in 2000. No Category 1996 2000 Variation 1 Percentage of crossbred in adult males 53.54 51.64-1.9 2 Percentage of crossbred in adult females 68.29 77.63 9.34 3 Percengage of crossbred animals inmilk 70.43 79.44 9.01 4 Percentage of crossbred dry cows 64.44 79.60 15.16 5 Percentage of male stock in crossbreds 10.14 7.36-2.78 6 Percentage of female stock in crossbreds 67.33 78.59 11.26 7 Percentage off crossbred cows in animals inmilk 68.22 77.77 9.55 8 Percentage of indigeneous cows in animals inmilk 28.64 20.13-8.51 Source: Livestock Census, 2000, p. 9. There was a decrease noted in indigeneous cows and crossbred males. High increase was observed in the possession of crossbred cows. are the following: The major reasons for the decrease of male stock in cattle population (a) The high popularity of artificial insemination facility at a low cost / no cost level (some private sector dairy units do it freely) and it is available at the door step of the dairy farmer.

108 (b) The high cost involved in the maintenance of bulls; they need special compounded feed. (c) There is scarcity of fodder and free grazing land. Due to urbanization, in rural areas too, the free grazing lands are now, converted into residential complexes. in the state. The following table gives information about the buffalo population Table 4.6: Distribution of Buffaloes in the State in 1996 and in 2000 Census No Category 1996 2000 Percentage of variation 1 Total male buffaloes 67480.00 57021.00-15.50 2 Total female buffaloes 97645.00 54444.00-44.24 3 Total buffaloes (1+2) 165125.00 111465.00-32.50 4 Percentage of buffaloes in animals inmilk 3.14 2.10 Source: Livestock Census, 2000, p. 9. The above table indicates that there is high decrease in the buffalo population from 1996 to 2000. The main reason is the farmers attraction to crossbred cows which are easy to lookafter, when compared to buffaloes. The decrease in free grazing land and increase in the cost of cattle feed are other reasons of this phenomenon.

109 4.2.2 Milk Production In milk production the compound annual average growth rate recorded during the last decade was 4.2 per cent. The index of milk production in Kerala from 1993-94 to 2003-04 is given in the following table. Table 4.7: Milk Production of Kerala from 1993-94 to 2003-04 Milk Production Percentage Percentage Year in Kerala Change Over Contribution (Million tonnes) _Previous Year of Kerala 1993-94 2.0 -- 3.3 1994-95 2.12 5.84 3.3 1995-96 2.19 3.49 3.3 1996-97 2.25 3.01 3.3 1997-98 2.34 3.76 3.3 1998-99 2.42 3.29 3.2 1999-00 2.52 4.34 3.2 2000-01 2.60 3.17 3.2 2001-02 2.72 4.34 3.2 2002-03 2.42-10.96 2.8 2003-04 2.11-12.76 2.3 Source: Economic Review 2004, p. 79. The main reason for the decrease in the production of milk in recent years is the availability of milk from other states, especially from Tamil Nadu, at a cheaper rate in the state. The competition of low cost milk from Tamil Nadu compelled many farmers in the border area of Tamil Nadu to stop dairy farming altogether. At the same time, in Kerala, there are some factors that play against the dairy industry in general. They include hike in the price of

110 cattle feed and fodder, decrease in the free grazing land for animals and comparatively low cost availability of milk and milk products. The genetic upgradation attained through the artificial programmes launched by the state with the support of the frozen semen technology has helped to attain new heights in milk production. Despite considerable increase in the proportion of high yielding crossbred cattle, average milk yield per animal per day remains low at 6 litres compared to its potential of 8 to 10 litres. However, the average productivity attained by Kerala state is higher than the national average (2.78 litres) and has been increasing. Yearwise milk production for the period from 1993-94 to 2003-04 is given in the figure 4.1. Figure 4.1: Yearwise Production of Milk in Kerala from 1993-94 to 2003-04 Milk (in million tonnes) 3 2.5 2 1.5 1 2 2.12 2.19 2.25 2.34 2.42 2.52 2.6 2.72 2.42 2.11 0.5 0 1993-94 1994-95 1995-96 1996-97 1997-98 1998-99 1999-00 2000-01 2001-02 2002-03 2003-04 Year

111 When we study the trends in the requirement and availability of milk in Kerala, we see a big gap between them. This is highlighted in the table 4.8. Table 4.8 : Distribution of the Requirement and Availability of Milk in Kerala in Selected Years Year Milk (Lakh MT) Requirement Availability 1981 18.62 9.82 1991 21.24 17.85 2001 23.20 27.18 2002 23.74 24.19 2003 24.16 21.11 Source: Economic Review 2004, p.78. The data show that in 1981 there was a high shortage of milk and in 2001 there was a high surplus of milk. But in 2003, again a shortage of milk was recorded. From the first five year plan period to the year 2000, the average annual growth rate of milk production in Kerala was higher than that of the national average. But today it is less than the national average. The table is given below.

112 Table 4.9: Distribution of the Growth Rate of Milk Production in Kerala and in India from 1950-51 to 2000-01 Period Growth Rate of Milk Production Kerala India 1950-51 to 1960-61 2.50 1.64 1960-61 to 1970-71 2.52 1.15 1970-71 to 1980-81 12.52 4.51 1980-81 to 1990-91 6.41 5.50 1990-91 to 2000-01 4.24 4.16 1996-97 to 2001-02 3.78 4.37 Source: Economic Review 2004, p.79 It shows that Kerala recorded a growth rate higher than that of India till the Eighth Plan period. But during the Ninth Plan period ( 1996-97 - 2001-02 ) it came down to 3.78 per cent while that of India increased to 4.37 per cent. During 1990s flow of milk from Tamil Nadu to Kerala has highly increased. It contributes to the decrease in the production of milk in Kerala. Another reason is the changed life style in Kerala and less and less people are attracted to agriculture and dairy farming. In villages, too, there is a tendency to go out of the state in search of job because of the spread of education in villages. 4.2.3 Breeding Support Kerala Livestock Development Board (KLDB) is involved in the production and distribution of frozen semen and maintains three bull stations at Mattupatty, Dhoni and Kulathupuzha for the production of crossbred and

113 purebred cattle and buffalo bulls. Production of frozen semen during 2001-02 increased to 28.94 lakh doses from 24.78 lakh doses in 1996, the terminal year of the 8th Five Year Plan. Production and distribution of frozen semen in Kerala from 1993-94 to 2003-04 are furnished in the table 4.10. Table 4.10 : Production and Distribution of Frozen Semen from 1993-94 to 2003-04 (lakh doses) Year Production Distribution Distribution Total of Frozen Inside the Outside Distribution Semen State the State 1993-94 26.81 14.99 9.99 24.98 1994-95 24.85 15.36 10.97 26.33 1995-96 14.93 16.27 6.61 22.88 1996-97 24.78 15.39 7.83 23.22 1997-98 24.49 15.04 7.95 22.99 1998-99 25.57 15.75 7.70 23.45 1999-00 26.17 15.74 6.80 22.54 2000-01 20.13 15.83 7.60 23.43 2001-02 28.94 15.52 5.50 21.02 2002-03 23.79 15.32 6.45 21.77 2003-04 24.33 15.05 1.24 16.29 Source: Economic Review 2004, p. S 50. The table indicates that the total distribution of semen reached the peak during 1994-95 and reached the ebb during 2003-04. All other years it keeps almost stable performance. During 2003-04, though the production of frozen semen was increased, there was a high decrease noted in total distribution. This is due to the high decrease happened in the distribution outside the state. This happened

114 because of the intensive production of frozen semen started in the neighbouring states especially in Tamil Nadu. The Department of Animal Husbandry is responsible for providing Artificial Insemination (AI) support. The number of AI centres under animal husbandry department increased to 2440 in 1999-2000 and to 2537 in 2000-01, and decreased to 2505 in 2001-02. It increased to 2553 in 2002-03 and declined to 2538 in 2003-04. Along with 464 centres operated by other agencies, the total number of AI centres operational is 3002. 10 It is given in the table 4.11. Table 4.11 : Number of Artificial Insemination Centres in the State Under Various Agencies in 2003-2004 Department/Institution No. of AI Centres Department of Animal Husbandry 2538 Department of Dairy Development 11 Other Voluntary Organization (Pvt.) 211 APCOs 215 Tata Tea 27 Total 3002 Source: Economic Review, 2004, p.s 50. From the data it is observed that 84.5 per cent of the artificial insemination centres in Kerala are under the Department of Animal Husbandry in the state and other agencies hold only less number of centres. This is because in 1971 Department of Animal Husbandry entered into a close 10 Economic Review 2004, op. cit., p. 86.

115 collaboration with Indo-Swiss Project, a forerunner in artiticial insemination programme in the state. 4.2.4 Cattle Feed Based on cattle population the potential daily requirement for concentrated cattle feed in Kerala has been estimated at 5372 MT. At present the state has three cattle feed plants functioning at Pattanakkad, Malampuzha and Kallettumkara. The cattle feed plant at Pattanakkad (300 MT per day capacity) and Malampuzha (200 MT per day capacity) are under KCMMF, whereas Kerala Feeds Ltd., Kallettumkara with an installed capacity of 500 MT per day commissioned in 1999 is operating under a separate management. Due to the heavy demand of the pellet feed from farmers a custom packing arrangement has been set up at Erode, in Tamil Nadu, and about 1000 MT/month of cattle feed is catered from there. A project to augment the capacity of Malampuzha plant from 200 MT to 300 MT is in progress. Process upgradation automation and modernization in Pattanakad plant are in progress. During 2003-04 the two plants and custom packing operations under KCMMF produced and sold 1.07 lakh MT of cattlefeed. A mineral mixture plant was set up at cattle feed plant Malampuzha with technical support from NDDB and was commissioned in 2003. The mineral supplement produced is marketed as feed supplement under the brand name Milmamin. Production and sales details of the cattle feed plants are given in the table 4.12.

116 Table 4.12 : Distribution of Production and Sales of Cattle Feed in Various Production Units Production Sales Factory 2000-01 2001-02 2002-03 2003-04 2000-01 2001-02 2002-032003-04 Pattanakadu (KCMMF) 0.71 NA NA NA 0.67 0.71 0.68 0.64 Malampuzha 0.55 1.17 1.08 1.07 0.57 0.45 0.40 0.33 (KCMMF) Erode (Custom Packing ) - - - - - - - 0.10 Kerala Feeds Ltd. 0.72 0.82 1.06 1.16 0.71 0.83 1.07 1.16 Total 1.98 1.99 2.15 2.23 1.95 1.99 2.15 2.23 Source: Economic Review 2004, p.88. The Kerala Feeds Ltd. has received ISO 9001: 2000 quality system certification and is the only cattle feed manufacturing unit in India which has received the above certification. The company has a good marketing network which includes 400 dealers and 450 co-oepratives. It has also launched a mineral food supplement during March, 2004 under brand name Keramin. 11 4.2.5 Production of Fodder Most of the reports regarding the availability of fodder in Kerala project an alarming gap between demand and supply. Earlier cattle rearing has been integrated with rice farming system to the advantage of both. With the shift in cropping pattern the area under rice cultivation has come down by 50 11. Ibid., p. 88

117 per cent over the last two decades leading to drastic reduction in the availability of straw for feeding cattle. It is estimated that the state produces only 60 per cent of the roughage requirement for cattle in Kerala. Regarding the cattle feed concentrate, state is not producing even half of the requirement. Greenfodder cultivation is not as profitable as that of other crops. Nonavailability of land for fodder cultivation also stands as a major hindrance. The cost of concentrated feed is ever on the increase making it almost impossible for the dairy farmers in the state especially those with limited financial resources to maintain cattle. The present price of compounded feed ranges from Rs. 7.00 to Rs. 71.50 per Kg. There was a gradual decrease in the area of fodder cultivation in Kerala. The detailed data are given in the table 4.13. Table 4.13 : Distribution of the Area of Fodder Cultivation from 1997-98 to 2003-04 (in Hectares) Year Area covered under Fodder Cultivation 1997-98 10125.00 1998-99 10026.00 1999-00 5400.00 2000-01 4820.00 2001-02 4315.00 2002-03 2800.00 2003-04 3210..50 Source: Economic Review 2004, p.91 Compared to 1997-98, area under fodder cultivation exhibits a very high decrase in 2002-03. But a little progress has occured during 2003-04.

118 High decrease in the area of cultivation is the major reason for the scarcity of fodder in the state. Realizing the importance of fodder development in optimizing economic return from the dairy activity, the KLDB produced 10.80 MT of fodder seeds during 2003-04. The quantity of seed supplied by KLDB during 2003-04 is 15.65 MT. Detailed presentation of data is given in the table 4.14 Table 4.14 : Distribution of Fodder Seeds by KLDB from 1997-98 to 2003-04 Year Quantity of Seeds Quantity of Seeds Produced (MT) Supplied (MT) 1997-98 31.64 28.96 1998-99 26.50 30.48 1999-00 30.21 28.36 2000-01 16.20 35.09 2001-02 15.98 20.68 2002-03 13.51 12.57 2003-04 10.80 15.65 Source: Economic Review 2004, p.91 The Dairy Development Department is implementing a fodder cultivation promotion programme using root slips/stem cuttings of high yielding perennial fodder varieties like Hybrid Napier and Guinea which is widely acceptable by farmers. But during the year 2003-04 Dairy Development Department procured and supplied only 4.80 MT of fodder seeds as against 60 MT fodder seeds during 2002-03. The Department supplied 282.5 lakh root slips/stem cuttings during 2003-04 against 160 lakh during the previous year. They are given in the table 4.15.

119 Table 4.15 : Yearwise Distribution of Fodder Seeds and Root Slips by Dairy Development Department in the State and the Area Under Cultivation Year Procurement Total Area Fodder Root Area of Seeds Quantity of Covered Slips/Stem Covered Seeds Cuttings Supplied to Supplied Farmers (in MT) (in MT) (in Hectares) (in Lakhs) (in Hectares) 1997-98 310.45 310.45 9326 200.00 799.00 1998-99 307.40 307.40 9026 250.00 1000.00 1999-00 91.00 91.00 3560 460.00 1840.00 2000-01 72.80 72.80 2820 400.00 2000.00 2001-02 51.30 51.30 2315 400.00 2000.00 2002-03 60.00 60.00 2000 160.00 800.00 2003-04 4.80 4.48 1798 282.50 1412.50 Source: Economic Review 2004, p. 91 4.2.6 Better Management of Younger Calves Bringing down the age at first calving and reduction in the inter calving period of cross-breeds have been recognized as the most effective measure for augmenting milk production. With this objective a calf rearing programme by subsidizing cattle feed upto 32 months along with health cover and insurance was under implementation during eighth plan through dairy cooperatives. From the first year of the Ninth Five Year Plan (1997-98), this scheme is being implemented by local government bodies as a state sponsored programme. This is one of the effective programmes of Animal Husbandry Department and it has helped in reducing the age at maturity and inter calving period and improving milk production. Eventhough 56480 calves were enrolled

120 during Ninth Plan period enrolments during the last three years were comparatively lower than in the first two years of the Ninth Plan period. Details are given in the table 4.16. Table 4.16 : Year-wise Details of Calves Enrolled Under Special Livestock Development Programme in the State from 1997-98 to 2003-04 Year No. of Calves Enrolled Under SLDP 1997-98 30000 1998-99 10000 1999-00 8917 2000-01 7339 2001-02 4485 2002-03 6700 2003-04 23683 Source: Economic Review 2004, p.88 There was a high increase in enrolment during 2003-04. The reason is the publicity given to this programme in the Panchayat level due to the spread of Foot and Mouth Disease (caused by Picornaviridae Virus ) in the state. 4.2.7 Kamadhenu Insurance Scheme The Animal Husbandry Department in collaboration with United Insurance Company has formulated a Kamadhenu Insurance Scheme to insure the family of the farmers and their crossbred milch cows. The scheme is under implementation from 1998-99 onwards with the target of covering 400 crossbred cows per panchayat. The Animal Husbandry Department provides

121 technical assistance and the local governments are subsidizing the premium at varying rates. The number of cows insured during 2002-03 was 6245 and during 2003-04 was 5058. Details regarding number of farmers insured, amount of premium remitted and claims settled are given in the table 4.17.. Table 4.17 : Yearwise Performance of Kamadhenu Insurance Scheme from 1998-99 to 2003-04. Progress of Implementation Cattle Insurance Claims Settled Accident Death Medical Reimbursement Year Number Number Amount of Number Amount Number Amount Number Amount of Cows of Farmers Premium (in Lakh (in Lakh (in Lakh Insured Insured (in Lakh Rupeees) Rupees) Rupees) Rupeees) 1998-99 42583 69003 339.99 NA NA NA NA NA NA 1999-00 37008 61288 277.24 NA NA NA NA NA NA 2000-01 28677 45607 160.25 754 52.86 16 12.36 781 12.20 2001-02 3037 3796 70.62 1009 70.55 16 0.84 761 20.32 2002-03 6245 8838 58.25 875 73.58 52 5.60 746 25.55 2003-04 5058 8220 34.76 475 45.34 139 9.90 295 13.27 Source: Economic Review 2004, p.89. The table highlights the impact of insurance scheme in the state. But a gradual decrease is noted in the total number of cows, total number of farmers and in the amount of premium remitted in 2003-04 compared to the data in 1998-99. But there is an increase in the number of accident deaths and the amount claimed. Since the insurance scheme provides security to farmers it acts as an incentive to the dairy farmers to continue their dairy activity without anxiety and tension. It naturally motivates others to enter into the field of dairying.

122 4.2.8 Milk Marketing With the advent of Operation Flood Programme, under the aegis of the KCMMF, a well established system for regular procurement of milk from farmers and distribution to regular consumers became a reality. With the implementation of North Kerala Dairy Project supported by Swiss Development Agency, the entire state is under the network of Anand Pattern Dairy Cooperatives (APCOs). As on September 2004, the Federation was operating through 2577 APCOs with a total membership of 7.28 lakhs. The average milk procured per day by APCOs during 2004 was 7.05 lakh litres against the previous year average of 6.72 lakh litres. 12 In Kerala, where the production of milk is concentrated in the small farm sector and supply is dependent on seasonal factors, maintaining uninterrupted supply particularly during lean period is very difficult. The federation is thus forced to import milk from the neighbouring states during lean periods of August - September and January - May. The total import during 2003-04 was 604 lakh litres against 230 lakh litres during 2002-03. Seasonwise milk production in Kerala is given in the table 4.18. 12. Ibid., p. 91

123 Table 4.18 : Seasonwise Production of Milk in Kerala from 1996-97 to 2003-04 Summer Rainy Winter Year Quantity % to total Quantity % to total Quantity % to total Total 1996-97 7.49 33.17 7.71 34.15 7.38 32.68 22.58 1997-98 7.81 33.33 7.94 33.89 7.68 32.78 23.43 1998-99 8.14 33.64 8.26 34.13 7.80 32.23 24.20 1999-00 7.83 31.01 9.48 37.54 7.94 31.43 25.25 2000-01 8.21 31.52 9.39 36.05 8.45 32.43 26.05 2001-02 8.43 31.02 9.74 35.84 9.01 33.14 27.18 2002-03 7.77 32.12 8.50 35.51 7.83 32.17 24.19 2003-04 6.88 32.59 7.46 35.34 6.77 32.07 21.11 Source: Economic Review 2004, p.92 The table revealed that there was a decrease in the production of milk during summer season compared to rainy and winter seasons. Generally, it is observed that production is higher during rainy season than during winter season. Procurement and sale of milk by KCMMF stood at 1611 and 2098 lakh litres respectively as on September, 2004. Data on procurement and sale of milk by different dairies of KCMMF during 2001 to 2004 are presented in the table 4.19.

Table 4.19: Performance of the Dairies Under Kerala Co-opeative Milk Marketing Federation from 2001 to 2004. Sl Dairy Capacity Procurement (Lakh Ltrs.) Sales (Lakh Ltrs.) No. Lakh Ltr/day 2001 2002 2003 2004* 2001 2002 2003 2004* 1 Thiruvananthapuram 2.00 449.97 428.55 356.54 273.51 458.67 552.11 551.31 440.60 2 Kollam 1.00 432.95 431.68 281.83 151.78 304.55 340.55 407.19 318.57 3. Alappuzha 0.66 96.37 91.51 68.33 45.58 160.54 193.91 206.15 166.84 4 Kottayam 0.40 86.92 79.82 67.38 57.25 99.13 119.02 124.22 100.74 5 Ernakulam 1.50 403.52 377.62 353.34 287.85 316.68 381.14 401.10 331.20 6 Thrissur 0.60 175.97 149.82 137.69 85.25 101.98 121.92 122.15 91.00 7 Palakkad 1.00 358.90 342.23 331.80 287.98 132.96 160.24 165.00 134..71 8 Kannur 1.00 296.14 336.67 343.66 279.68 248.54 284.64 238.85 189.18 9. Kozhikode 1.50 183.17 169.64 156.40 121.24 257.12 309.03 331.81 244.60 10 Kasaragod 0.30 0.00 4.47 23.61 20.99 0.00 15.69 102.71 80.36 124 Total 9.96 2483.91 2412.01 2120.58 1611.11 2080.17 2478.65 2650.49 2097.80 Source: Economic Review 2004, p. 54. * as on September, 2004

125 It is observed that in 2004, there was a decrease in the procurement and sale of milk by all dairy units of KCMMF in the state. The main reason is that in the table, as indicated below the table, data as on September 2004, are included. In 2003 there was a decrease occured in the procurement of milk, compared to 2002, but in sale there was an increase recorded in 2003, compared to 2002. This is mainly due to the procurement of milk from other states. The number of functional milk co-operatives has increased from 1621 in 1994 to 2341 in 2004. Similarly there is an increase in the total procurement of milk too. The details are highlighted in the table 4.20. Table 4.20 : Yearwise Distribution of the Number of Functional Societies and Total Procurement of Milk from 1994 to 2004 Year No. of Functional Total Procurement/ Societies Day (Litres) 1994 1621 414730 1995 1722 465294 1996 1784 484969 1997 1826 464998 1998 1985 566247 1999 2040 629114 2000 2092 688864 2001 2130 714301 2002 2250 708137 2003 2308 671720 2004 2341 704716 Source: Economic Review 2004, p.s.55

126 We noticed an increase in the number of functional societies during 1994 to 2004. Though there was a little variation, on the whole, there was an increase in total procurement of milk too. 4.2.9 Pricing Pattern of Milk The price of milk paid to the producer is based upon FAT and SNF content in the milk. Till 2000 there existed a common price structure for the milk collected by KCMMF. But from 2000-01 onwards different price structures were adopted in the 3 regional milk unions, namely, Trivandrum Cooperative Milk Producers Union, Ernakulam Co-operative Milk Producers Union and Malabar Co-operative Milk Prdoucers Union. The details are highlighted in the table 4.21.

127 Table 4.21: Yearwise Price Revision Details of Milk from 1995 to 2003 Date of FAT SNF Purchase Price Sales Price Revision/ (Rs./Kg) (Rs./Kg) (Rs./Kg) (Rs./Kg) 21.01.1995 62.50 62.50 7.19 10.00 31.01.1996 69.90 69.90 8.04 11.00 01.01.1997 80.15 77.01 8.95 12.00 01.04.1999 95.70 78.30 9.73 13.00 TRCMPU 01.04.2001 95.70 78.30 9.73 13.00 01.07.2001 91.30 74.70 9.09 13.00 11.08.2001 95.70 78.30 9.73 13.00 01.11.2001 95.70 79.55 9.71 13.00 21.11.2001 103.54 85.90 10.40 14.00 ERCMPU 11.05.2000 95.70 78.30 9.23 13.00 11.07.2001 91.30 74.70 9.09 13.00 21.11.2003 98.99 80.99 9.85 14.00 MRCMPU 21.05.2000 95.70 78.30 9.23 13.00 11.10.2000 95.70 78.30 9.23 12.50 21.05.2001 95.70 78.30 8.63 12.50 01.10.2001 95.70 79.55 9.21 12.50 21.11.2003 103.34 85.90 10.40 14.00 Source: Economic Review 2004, p.s.55 From the table it is observed that there is a gradual increase in the purchase price of milk from the dairy farmers. It is essential because the prices of various inputs especially the cost of feed are increasing year after year. Provision of a fair price to the dairy farmer is essential for the existence of the dairy sector.

128 Conclusion The statistical analysis, both in the national level and in the Kerala State level, highlight the performance of the dairy sector in general and the various programmes implemented for the growth of the sector in particular. The statistical indicators provide the development that has taken place in dairy sector after the implementation of Five Year Plans and particularly the implementation of Operation Flood Programme in the country. While the development has been quite phenomenal at the National level, it is not upto expected levels in Kerala. It also points out other areas where proper attention and concerted efforts are required for further growth of the sector.