Dairy sector to grow at over 6% in 2023-24: Government

The dairy sector is expected to growth at more than 6% in 2023-24, said Union Animal Husbandry and Dairying minister Parshottam Rupala on Tuesda.

“Milk production is growing at the annual growth rate (CAGR) of 6.1% over the last eight years, and in the coming season, it is expected to grow at over 6%,” the minister said while addressing reporters on nine-year achievements of Department of Animal Husbandry and Dairying.

Emphasising the domestic supply, Rupala said, “there is no supply constraint of milk in the country and there is ample quantity of milk powder.”

This comes after a buzz around supply crunch pushing up retail milk prices steeply in 2022-23.

Dairy is the single largest agricultural commodity that contributes 5% to India’s national economy and employ more than 8 crore farmers directly. In 2023, the average retail price of milk in the country has shot up by 10% in June year-on-year to ₹57.61 per litre.

With a contribution of 23% to global milk production, India holds the first production. However, the cost of production in the country has been going up steadily due to several factors including a rise in the cost of feed, which accounts for a significant portion of the expenses of dairy farmers. The cost of feed has been increasing due to a shortage of fodder and the spike in the price of raw materials such as corn and soybeans. This has made cattle feed expensive. Additionally, lower dairy yields as cows are inadequately fed amid rupturing demand during the pandemic. Unseasonal rain and heat waves have also caused a jump in feed prices.

Another factor behind the increase in milk prices is the rising cost of labor. Dairy farming is labor-intensive, and the wages of laborers have been increasing because of inflation and the implementation of minimum wage laws. The cost of transportation and storage of milk has also been going up, which has added to the overall cost of production.

The per capita availability of milk in 2021-22 was 444 grams per day as against the world average of 394 grams, Rupala said.

As far as the egg and meat production is concerned, India in 2021-22 produced 129.6 billion eggs as against 78.48 billion in 2014-15 and 9.29 million tonnes (mt) of meat compared with 6.69 mt in 2014-15.

India is one of the leading exporters of meat, dairy and poultry products. In 2022-23 financial year, the country exported meat, dairy and poultry products worth $4.03 billion, 2% lower than FY22.