A ten-animal unit will most probably become the necessity of the changing times. A farmer maintaining two-animal unit would think about increasing his herd size so that one of his family members can work full-time on it, while others can look after farming. Otherwise also, a ten-animal unit has the potential to generate income almost equal to what a school-qualified can get as monthly salary for a job in a nearby town. Therefore, there is definite scope for a ten-animal unit, managed by a farmer’s family having one hectare of land dedicated to fodder cultivation. Farmers themselves may take up this approach, or any dairy organisation in cooperative or private sector or a voluntary NGO may support a chain of such units. This would help the farming community to upgrade their socio-economic status, while dairy organisation would benefit by getting more milk—perhaps, good quality milk—from a fewer locations.

It is projected that the dairy unit would have ten crossbred cows (Holstein or Jersey) or ten-graded Murrah buffaloes and their followers. The total investment would be Rs 7 lakh in which maximum borrowing would be Rs 5.5 lakh or less and the rest of the fund contributed by the farmer towards housing and equipment. This does not include the cost of land for fodder cultivation and cattle shed.

The dairy unit would be located near the farm/village with a milk collection centre or near to a town/city where milk can fetch good price. The economics of such a unit has been worked out on the following assumptions:

  • The farmer opts for Crossbred Jerseys (CBJ) or Crossbred Holsteins (CBH) or Graded Murrah Buffaloes (GMB), depending on the family size, land holding, fodder and water availability. It is mentioned here that CBJ animals can be easily handled by women whereas in the case of buffaloes, more water would be required. So choice has to be exercised accordingly.
  • The cost of a CBJ animal is considered at Rs 45,000, for CBH animal at Rs 55,000 and for GMB animal at Rs 55,000, including transportation, etc.
  • The animals will be purchased during their second lactation and in the first month after calving. The animals will be carefully selected as per the standard guidelines of selection. The milch animals will be purchased in two lots. In the case of crossbred cows, the second lot of five cows will be purchased after three months from the purchase of the first lot. In the case of buffaloes, the second lot of five buffaloes will be brought in after six months. This is to ensure that animals are not purchased by compromising on quality. They are brought in a truckload at a time and the farmer gets time to start managing them without a heavy burden coming suddenly. Animals will also help in cash flow.
  • Investment in cattle-shed is projected at minimum requirements. Each animal would require 3 square metre area, calculated at 2 metres in length and 1.5 metres in breadth for standing. This can be provided for all ten animals in a single row or for five animals each in two rows. Accordingly, the manger will be single or double, but with standard width of 60 cm. On the backside of the animal-row, a channel of 30 cm width will run for flow of urine. Locally available material will be used to construct the standing place, manger and channel. The floor will be brought up to even surface, without cracks and crevices and with anti-slippery finish. The manger will be provided by using cement half-pipes properly embedded. A water tank will be provided in the shed. The roof will have thatching by straw to keep its cool. It would be supported by M.S. pipes (10 cm diameter, Grade II) and the top will be of A.C. sheets (or tiles). Towards the end of the shed/s, room/s will be provided to house the calves, heifers and for storage of feed. In case the option of animals in two rows is chosen (due to availability of space), it may be possible to provide area for loafing — on sharing basis — five animals loose at a time (see sketch). It is envisaged that the investment in the cattle-shed and other items will be kept within Rs 150,000 while providing essential features.
  • For the purpose of calculation, a year has been taken as of 360 days’ duration.
  • Average lactation period has been considered as 300 days for crossbred cows and 280 days in case of buffaloes. Similarly, the dry period has been taken as 100 days for crossbred cows and 140 days in case of buffaloes.
  • The lactation period of all milch animals during the first year of their purchase will be short by about one month.
  • The average milk yield per day has been considered as 10 litres for CBH cow, 8.3 litres for CBJ cow and 7.5 litres for GMB.
  • The average percentage of fat and SNF in milk in the case of CBH, CBJ and GMB has been considered as 3.8 and 8.5, 4.3 and 8.5 and 6.5 and 9 respectively.
  • The average price of milk per litre in the case of CBH, CBJ and GMB has been taken as Rs 50, Rs 24 and Rs 30.
  • It is envisaged that the milch animals will be fed with green fodder, dry fodder and concentrates during lactation and dry period. The feeding will be in proportion to their body weight (on dry matter basis) and requirement for maintenance and production. The amount of feeding will be reduced in dry period to minimize the cost.
  • The cost of green fodder, dry fodder and concentrate is taken at Rs 150, Rs 530 and Rs 1,300 per quintal.
  • It is envisaged that all the milch animals will be covered under good artificial insemination service and veterinary cover. A sum of Rs 2,000 to Rs 2,500 is provided per animal per year.
  • All the milch animals will be covered under insurance against mortality/permanent disability for which premium is projected at 4.5 per cent for crossbred cows and 4 per cent for buffaloes on purchase cost.
  • It is envisaged that the dairy unit will consume electricity and use sizable quantity of water (more in case of buffaloes) for which expenditure of Rs 5,000 and Rs 7,500 per year is provided for CBJ and CBH/GMB units respectively.
  • It is contemplated that the dairy unit will be managed by the family member/s.
  • Income from the sale of calves is not taken into account, as it will be offset by their rearing cost.
  • Income from manure is not taken into account, as the farmer will use it for fodder cultivation thereby reducing its production cost by saving the fertilizer use.
  • While considering the cost of concentrates, it is envisaged that the dairy unit will use balanced cattle feed and will also support it with locally available by-products.
  • While considering the cost of dry fodder, it is envisaged that even low-quality straw will be used to some extent after treating it with urea.
  • It is considered that the farmer would use power-operated chaff-cutter costing Rs 20,000 to cut the fodder so as to use it economically.

On the basis of the assumptions given above, Tables 1 to 5 are drawn which give projections on requirement of feeds and fodder, number of days in milk and dry days, operational expenditure, income and profit and loan repayment for a 10-animal dairy unit.

Figure 1.  Sketch showing various features of a 10-animal dairy unit

Table 1. Statement showing requirement of feed and fodder and expenditure per day.

I. While in Milk
Item

Rate

Rs per

kg

 CBH CBJ GMB
Kg

Cost

(Rs)

 Kg

Cost

(Rs)

 Kg

Cost

(Rs)
Green Fodder 1.50 25.0 37.50 20.0 30.00 20.0 30.00
Dry Fodder 5.30 3.5 18.55 3.5 18.55 6.0 31.80
Concentrates 13.00 5.0 65.00 3.5 45.50 3.0 39.00
Total (Rs) 121.05   94.05   100.80
II. While Dry
Green Fodder 1.50 15.0 22.50 15.0 22.50 10.0 15.00
Dry Fodder 5.30 6.0 31.80 5.0 26.50 8.0 42.40
Concentrates 13.00 1.5 19.50 1.0 13.00 1.0 13.00
Total (Rs) 73.80   62.00   70.40

 

Table 2. Statement showing number of days in milk and dry days, year-wise.

I. In Cows (CBH & CBJ)
Lot Days in Milk
1st Year 2nd Year 3rd Year 4th Year 5th Year
No. 1 1350 1500 1500 1350 1300
No. 2 1350 1350 1350 1350 1350
Total 2700 2850 2850 2700 2650
Dry Days
No. 1 450 300 300 450 500
No. 2 – 450 450 450 450
Total 450 750 750 900 950
II. In Buffaloes
  Days in Milk
No. 1 1250 1400 1350 1100 1100
No. 2 900 1100 1100 1100 1250
Total 2150 2500 2450 2200 2350
Dry Days
No. 1 550 400 450 700 700
No. 2 – 700 700 700 550
Total 550 1100 1150 1400 1250

 

Table 3. Statement showing recurring expenditure (Rs).

Expenditure on

 First Year Second Year Third Year Fourth Year Fifth Year
CBH CBJ GMB CBH CBJ GMB CBH CBJ GMB CBH CBJ GMB CBH CBJ GMB

 

Feed Cost

 During Days in milk 326700 253800 216720 344850 267900 252000 344850 267900 246960 326700 253800 221760 320650 249100 236880
During Dry Days 33210 27900 38720 55350 46500 77440 55350 46500 80960 66420 55800 98560 70110 58900 88000
Veterinary Aid/A.I. 25000 20000 20000 25000 20000 20000 25000 20000 20000 25000 20000 20000 25000 20000 20000
Insurance 21656 17718 16500 24750 20250 22000 24750 20250 22000 24750 20250 22000 24750 20250 22000
Electricity/Water 7500 5000 7500 7500 5000 7500 7500 5000 7500 7500 5000 7500 7500 5000 7500
Total 414066 324418 299440 457450 359650 378940 457450 359650 377420 450370 354850 369820 448010 353250 374380

 

Table 4. Statement showing income and profit before loan repayment (Rs).

  First Year Second Year Third Year Fourth Year Fifth Year
I. Income CBH CBJ GMB CBH CBJ GMB CBH CBJ GMB CBH CBJ GMB CBH CBJ GMB
Sale of Milk 607500 537840 483750 641250 567720 562500 641250 567720 551250 607500 537840 495000 596250 527880 528750
Less expenditure 414066 324418 299440 457450 359650 378940 459450 359650 377420 450370 354850 369820 448010 353250 374380
II. Profit
Profit for the Unit 193434 213422 184310 183800 208070 183560 181800 208070 173830 157130 182990 125180 148240 174630 154370
Profit per animal 19343 21342 18431 18380 20807 18356 18180 20807 1783 15713 18299 12518 14824 17463 15437
Profit per animal per month (Rs) 1611 1778 1535 1531 1733 1529 1515 1733 1448 1309 1525 1043 1335 1455 1286

 

Conclusion The farmer will be able to generate surplus during each year of the project after making repayment of loan instalments. The lower amount of surplus (-) in fourth year in GMB unit is because of maximum number of dry days. Also, in case of GMB unit, the repayment of loan will extend in the sixth year, but it is loaded over the period of five years. After five years, the surplus amount will be much more since there will not be any burden on account of repayment. Further, the farmer will have produced his own stock of farm-bred cows and heifers (around 30 numbers) during the project period. He will be in a position to retain the best animals and sell the surplus stock. However, all this will require every care in selecting the parent stock, economical feeding, control over breeding and diseases, apart from the assured milk prices assumed in the project proposal.