Table 5.3 Experience of households in milk-production
activities
|
Small |
Medium |
Large |
Commercial |
All |
Northern Region
|
| Experience
in dairy farming (years) |
22
|
22
|
25
|
17
|
20
|
| Households
with |
| £ 5 years |
3
|
2
|
2
|
12
|
4
|
| 5-10 years |
14
|
13
|
9
|
23
|
14
|
| 10-15
years |
18
|
10
|
12
|
9
|
13
|
| 15-20
years |
29
|
32
|
31
|
35
|
31
|
| > 20
years |
36
|
43
|
47
|
21
|
38
|
Western Region
|
| Experience
in dairy farming (years) |
20
|
21
|
19
|
17
|
20
|
| Households
with |
| £ 5 years |
5
|
11
|
14
|
13
|
9
|
| 5-10 years |
21
|
19
|
12
|
23
|
19
|
| 10-15
years |
23
|
16
|
20
|
14
|
19
|
| 15-20
years |
11
|
9
|
20
|
17
|
13
|
| > 20
years |
40
|
45
|
34
|
33
|
40
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
Table 5.4 Distribution of households according to main
source of occupation
|
Small
|
Medium
|
Large
|
Commercial
|
All
|
Northern Region
|
| Main
occupation of head of household (%) |
| Crop
farming |
31
|
79
|
83
|
30
|
55
|
| Dairy
farming |
0
|
2
|
8
|
68
|
11
|
| Wage
earning |
12
|
7
|
7
|
0
|
9
|
| Service |
42
|
10
|
2
|
0
|
19
|
| Others |
15
|
2
|
0
|
32
|
7
|
| Spouse
of head of household (%) |
| Crop
farming |
1
|
1
|
5
|
29
|
6
|
| Dairy
farming |
98
|
97
|
95
|
71
|
94
|
| Wage
earning |
1
|
0
|
0
|
0
|
0
|
| Service |
0
|
0
|
0
|
0
|
0
|
| Others |
0
|
1
|
0
|
0
|
0
|
Western Region
|
| Main
occupation of head of household (%) |
| Crop
farming |
42
|
41
|
16
|
7
|
33
|
| Dairy
farming |
44
|
59
|
80
|
93
|
61
|
| Wage
earning |
10
|
0
|
4
|
0
|
5
|
| Service |
3
|
0
|
0
|
0
|
1
|
| Others |
1
|
0
|
0
|
0
|
1
|
| Spouse
of head of household (%) |
| Crop farming |
1
|
54
|
78
|
90
|
55
|
| Dairy
farming |
98
|
42
|
18
|
7
|
40
|
| Wage
earning |
0
|
3
|
4
|
0
|
2
|
| Service |
0
|
1
|
0
|
0
|
1
|
| Others |
1
|
0
|
0
|
3
|
2
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
Table 5.5 Distance to market, milk collection center,
and road
|
Small
|
Medium
|
Large
|
Commercial
|
All
|
Northern
Region
|
| Households
(%) with average distance to milk collection center |
| £ 1 km |
72
|
75
|
88
|
44
|
76
|
| 1-2 km |
3
|
0
|
2
|
53
|
1
|
| > 2 km |
25
|
25
|
10
|
3
|
22
|
| Households
(%) with average distance to nearest market |
| £ 1 km |
0
|
|
0
|
79
|
10
|
| 1-3 km |
14
|
|
0
|
6
|
12
|
| 3-5 km |
12
|
|
14
|
3
|
11
|
| > 5km |
74
|
|
86
|
12
|
67
|
| Households
(%) with average distance to paved road |
| £ 1 km |
62
|
60
|
62
|
76
|
63
|
| 1-3 km |
0
|
0
|
0
|
24
|
3
|
| 3-5 km |
13
|
13
|
10
|
0
|
11
|
| > 5 km |
25
|
27
|
2
|
0
|
23
|
Western
Region
|
| Households
(%) with average distance to milk collection center |
| £ 1 km |
72
|
97
|
94
|
90
|
95
|
| 1-2 km |
3
|
3
|
6
|
10
|
5
|
| > 2 km |
25
|
0
|
0
|
0
|
0
|
| Households
(%) with average distance to nearest market |
| £ 1 km |
0
|
0
|
0
|
0
|
0
|
| 1-3 km |
15
|
13
|
6
|
17
|
11
|
| 3-5 km |
46
|
37
|
34
|
70
|
38
|
| > 5km |
39
|
50
|
60
|
13
|
51
|
| Households
(%) with average distance to paved road |
| £ 1 km |
62
|
98
|
98
|
97
|
98
|
| 1-3 km |
0
|
2
|
2
|
3
|
2
|
| 3-5 km |
13
|
0
|
0
|
0
|
0
|
| > 5 km |
25
|
0
|
0
|
0
|
0
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
5.2 Asset Ownership and Distribution
Land is an important asset of farmers, although in the
case of dairy production, purchased or exchanged feed and fodder can be
substituted for land holdings. The average size of land holdings was smaller
(1.06 hectares) in the northern region than in the western region (1.85
hectares). It ranged from about 0.43 hectares in the case of small farms to
about 2.60 hectares in the case of large farms in the northern region (Table
5.6). In the western region, it ranged from 0.85 hectares for small farms to
4.08 hectares for commercial farms. However, land productivity in the northern
region is higher than in the western region due to better irrigation facilities
and other resources. Most of the commercial farms are landless and highly
dependent on market-purchased feeds and fodder.
Table 5.6 Land ownership pattern in sample households
|
Own Land (ha)
|
Leased-in
(ha) |
Leased-out
(ha) |
Total
Operational Area |
Irrigated
|
Non-irrigated
|
Northern
Region
|
| Small
Farms |
0.36
|
-
|
0.10
|
0.03
|
0.43
|
| Medium
Farms |
1.10
|
-
|
0.16
|
0.02
|
1.24
|
| Large
Farms |
1.38
|
-
|
0.26
|
0.04
|
1.60
|
| Commercial |
1.23
|
-
|
0.39
|
-
|
1.62
|
| All Farms |
0.89
|
-
|
0.19
|
0.02
|
1.06
|
Western
Region
|
| Small
Farms |
0.77
|
0.03
|
0.09
|
0.04
|
0.85
|
| Medium
Farms |
1.66
|
0.10
|
0.36
|
0.02
|
2.10
|
| Large
Farms |
2.06
|
0.22
|
0.18
|
0.09
|
2.37
|
| Commercial |
2.68
|
1.14
|
0.37
|
0.11
|
4.08
|
| All Farms |
1.52
|
0.18
|
0.20
|
0.05
|
1.85
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
The size distribution of households showed that about
42 percent of households in the north and 38 percent in the west had less than
one hectare of land for cultivation (Table 5.7). More than one-fourth of
smallholder dairy farmers in the north were landless laborers, while the share
of such households in the western region was 11 percent (Table 5.8). Nearly 26
percent of households in the north and 17 percent in the west had taken land on
lease from other farmers. The terms of lease were mainly a fixed amount per
unit of land and varied depending on the quality of the land. Only a small
proportion of households rented out their land, mainly due to small
landholdings.
Table 5.7 Distribution of selected households
according to farm size
|
Small
|
Medium
|
Large
|
Commercial
|
All
|
| Northern
Region (%) |
| < 0.5
ha |
38
|
5
|
15
|
23
|
22
|
| 0.5-1.0 ha |
28
|
17
|
9
|
11
|
20
|
| 1.0-2.0 ha |
16
|
48
|
42
|
29
|
35
|
| 2.0-3.0 ha |
12
|
17
|
17
|
20
|
11
|
| > 3 ha |
6
|
14
|
17
|
17
|
12
|
| Western
Region (%) |
| < 0.5
ha |
42
|
4
|
5
|
44
|
23
|
| 0.5-1.0 ha |
28
|
6
|
7
|
6
|
15
|
| 1.0-2.0 ha |
16
|
24
|
22
|
0
|
17
|
| 2.0-3.0 ha |
12
|
31
|
12
|
9
|
17
|
| > 3 ha |
6
|
35
|
53
|
41
|
29
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
Table 5.8 Proportion of farmers leasing-in and
leasing-out land
|
Small
|
Medium
|
Large
|
Commercial
|
All
|
| Northern Region (%) |
|
| Landless |
28
|
3
|
7
|
41
|
18
|
|
| Lease-in |
30
|
21
|
24
|
24
|
26
|
|
| Lease-out |
3
|
3
|
2
|
0
|
2
|
|
| Western Region (%) |
|
| Landless |
11
|
4
|
6
|
3
|
7
|
|
| Lease-in |
9
|
10
|
14
|
30
|
17
|
|
| Lease-out |
5
|
1
|
4
|
3
|
3
|
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
Farmers grow a variety of crops in the study area. (Table 5.9). In
the western region, rice (17%) is a main crop during kharif season and wheat (19%) in rabi season, accounting for nearly
two-thirds of the total cropped area. Bajra and cotton were two other important kharif crops, occupying about 11 percent of
gross cropped area. Jowar, maize, and lucern were important fodder crops. The
average area allocated for fodder crops ranged from about 13 percent on small
farms to about 22 percent on commercial farms.
The cropping pattern in the northern region is also dominated by rice
in kharif and wheat in rabi season, accounting for over
three-fourths of the gross cropped area. The area under fodder crops ranged
from 8.7 percent on small farms to about 20 percent on commercial farms, with
an average of 13.4 percent for all categories. Maize, jowar, and berseem were
important fodder crops. In addition, farmers grow berseem (fodder) as a mixed
crop with mustard in the region.
Livestock
is an important component of farming systems in India. The distribution of the
bovine population in the selected households in given in Table 5.10.
Table 5.9 Cropping pattern in the study area
| Crops/Regions |
Small
|
Medium
|
Large
|
Commercial
|
All
|
| Western Region (%) |
| Paddy |
11.29
|
15.14
|
16.55
|
25.89
|
17.05
|
| Wheat |
19.25
|
18.78
|
20.17
|
17.68
|
18.96
|
| Bajra |
20.12
|
15.26
|
11.53
|
8.61
|
13.88
|
| Mustard |
3.62
|
2.54
|
1.59
|
0.81
|
2.15
|
| Fodder |
26.32
|
29.28
|
31.38
|
36.66
|
30.8
|
| Kharif |
9.98
|
10.11
|
11.76
|
13.97
|
11.31
|
| Rabi |
8.70
|
8.83
|
10.55
|
10.84
|
9.64
|
| Summer |
7.64
|
10.34
|
9.07
|
11.85
|
9.85
|
| Others |
19.40
|
19.00
|
18.78
|
10.35
|
17.16
|
| Northern Region (%) |
| Paddy |
40.40
|
42.30
|
37.80
|
34.80
|
38.90
|
| Wheat |
41.30
|
43.00
|
38.20
|
35.40
|
39.50
|
| Fodder |
8.70
|
9.00
|
14.80
|
20.40
|
13.40
|
| Kharif |
5.80
|
6.40
|
9.60
|
11.50
|
8.60
|
| Rabi |
1.60
|
0.10
|
2.40
|
0.00
|
1.30
|
| Summer |
1.30
|
2.50
|
2.80
|
8.90
|
3.50
|
| Berseem+Mustard |
6.20
|
5.40
|
7.40
|
9.40
|
7.00
|
| Others |
3.40
|
0.30
|
1.80
|
0.00
|
1.20
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
The average number of animals per household varies with the size
of the farm; however, there were striking differences in terms of milk animal
population composition across regions and categories of households. Buffalo was
a main source of milk production in the western region, but its importance
differed across farm size. Among small and medium farmers, about 90 percent of
milk animals were buffaloes, while large farmers kept about 79 percent milk
buffaloes and 21 percent crossbred cows. In the case of commercial farms,
buffaloes constituted about two-thirds of milk animal population; the rest were
crossbred cows. In the northern region, the share of crossbred cows was higher
than buffaloes. Buffaloes constituted about 32 percent of total milk animal
population. Commercial farmers' herd composition consisted of about 32 percent
buffaloes and 68 percent crossbred cows.
Table 5.10 Average number of bovines in the study area
| Farm
Size |
Cows
|
Buffaloes
|
In-milk
|
Dry
|
Heifers
|
Calves
|
In-milk
|
Dry
|
Heifers
|
Calves
|
| Northern Region |
| Small |
-
|
-
|
-
|
-
|
1
|
-
|
-
|
-
|
| Medium |
-
|
-
|
-
|
-
|
3
|
1
|
1
|
2
|
| Large |
2
|
1
|
-
|
-
|
5
|
2
|
2
|
3
|
| Commercial |
9
|
2
|
1
|
4
|
7
|
1
|
1
|
3
|
| All Farms |
2
|
-
|
-
|
1
|
3
|
1
|
1
|
2
|
| Western Region |
| Small |
2
|
-
|
-
|
2
|
1
|
-
|
-
|
2
|
| Medium |
4
|
2
|
-
|
3
|
2
|
1
|
-
|
3
|
| Large |
7
|
2
|
2
|
5
|
2
|
1
|
2
|
4
|
| Commercial |
15
|
4
|
3
|
8
|
7
|
2
|
2
|
3
|
| All Farms |
6
|
4
|
5
|
3
|
3
|
2
|
1
|
4
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
More than half of the selected households had 1-3 milk animals;
fewer than 10 percent kept more than 15 milk animals (Table 5.11). In India,
about 70 percent of households keep one to three milk animals, and there are
very few large herds. Since the objective of this study is to examine the
impact of livestock industrialization on the welfare of rural households, we
purposely selected households with large herd sizes. In certain villages, it
was difficult to find dairy farmers with 10 or more milk animals; however, in
parts of Punjab and Haryana, the average size of dairy herds has increased
significantly during the past few years. Since no reliable data are available
at the state or national levels about changes in the structure of dairy herds,
we tried to get some estimates from the selected households about the changes
in herd size milk over the past 15 years on the basis of respondents' memory
(Table 5.12).
The
average number of animals kept by smallholders did not change much during the
last two decades, and ranged between two and four. Two of the reasons given by
the respondents were shortage of land for growing fodder crops and
market-related problems. Similarly, in the case of medium farmers, there was
not much increase in dairy herd size. However, there appeared to be a
ramping-up of herd size in large and commercial farms during the 1990s, especially
in the case of commercial farms. These estimates are on the basis of the memory
of the respondents, and therefore need to be interpreted carefully and not
generalized.
Table 5.11 Distribution of households according to
milk animal herd size
| Size |
Percent of households
|
North
|
West
|
| £ 2
animals |
27
|
26
|
| 3-5
animals |
26
|
30
|
| 6-8
animals |
14
|
21
|
| 9-10
animals |
4
|
9
|
| 10-15
animals |
21
|
8
|
| > 15
animals |
8
|
6
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
Table 5.12 Changes in dairy herd size: 1980s and 1990s
(1980-2002)
|
Early 1980s/Start
|
1990
|
1995
|
2002
|
| Northern Region |
| Small |
3
|
4
|
3
|
2
|
| Medium |
6
|
7
|
8
|
8
|
| Large |
7
|
9
|
11
|
12
|
| Commercial |
7
|
8
|
12
|
22
|
| All |
6
|
7
|
8
|
9
|
| Western Region |
| Small |
3
|
4
|
4
|
3
|
| Medium |
5
|
5
|
6
|
7
|
| Large |
8
|
10
|
11
|
13
|
| Commercial |
13
|
14
|
21
|
28
|
| All |
6
|
7
|
8
|
10
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
The performance of milk animals depends on many factors, such as
genetic potential, quality of feed, availability of animal health and breeding
services, and management practices. Production traits of milk animals play a
crucial role and have a profound influence on the cost and returns of any dairy
enterprise. Important traits such as age at first calving, lactation length,
dry period, and milk yield per animal on different categories of farms are
given in Tables 5.13 and 5.14.
The late maturity of dairy animals, resulting in high cost of
rearing animals to the age of first calving, was one of the major causes for
the uneconomic nature of dairying in India. The age at first calving is
governed by biological factors such as age at maturity and conception rate,
which are again influenced by breeding, feeding, management, and environmental
factors. The average age at first calving was higher for buffaloes than for
crossbred cattle. In general, for the study area as a whole, the average age at
first calving for buffaloes and crossbred cattle was found to be 43 and 33
months, respectively, in the northern region; the corresponding figures for the
western region were 45 and 35 months. In general, the age at first calving of
buffaloes and crossbred cows was less in the small and commercial groups of
farms.
The
lactation length affects total milk production and, consequently, the returns
from dairy animals. A prolonged dry period puts the dairy farmer at a
disadvantage, since the animals must be fed and taken care of during this
period, increasing the cost of maintenance. The inter-calving period is the sum
of in-milk and dry days or the period between two successive calvings. Short
inter-calving periods lead to higher numbers of lactations in the productive
life of animals, which result in higher income from the sale of milk and
calves. In some cases, farmers may choose to extend lactation beyond the
economically optimal period due to need for cash flow or perceived risks associated
with calving.
Table 5.13 Economic traits of milk animals on selected
households
Farm Size
|
Cows
|
Buffaloes
|
Age at Ist calving (months)
|
Lactation length (days)
|
Dry period (days)
|
Age at Ist calving
(months)
|
Lactation length (days)
|
Dry period (days)
|
| Northern Region |
| Small |
36
|
300
|
85
|
42
|
365
|
120
|
| Medium |
40
|
280
|
90
|
41
|
350
|
110
|
| Large |
34
|
275
|
75
|
43
|
385
|
105
|
| Commercial |
32
|
290
|
60
|
40
|
345
|
115
|
| All Farms |
33
|
287
|
73
|
42
|
352
|
112
|
| Western Region |
| Small |
34
|
283
|
60
|
39
|
350
|
135
|
| Medium |
34
|
276
|
70
|
42
|
339
|
130
|
| Large |
36
|
278
|
65
|
43
|
335
|
124
|
| Commercial |
35
|
276
|
57
|
44
|
360
|
138
|
| All Farms |
35
|
275
|
63
|
43
|
340
|
134
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
The average lactation length in buffaloes was about 352 days in
the northern region and 340 days in the western region. The dry period ranged
from 112 days in the Northern region to 134 days in the western region. In the
case of crossbred cows, the lactation length did not vary significantly across
regions or categories of farms. The average lactation length ranged from 287 days
in the northern region to 275 days in the western region. There has been a
marked decrease in dry periods and inter-calving periods in both buffaloes and
crossbred cows, which may be attributed to improvement in farm-level
technological management and access to breeding services.
The quantity of milk production on a dairy farm does not depend on
the total number of animals in the herd but on the number of animals in milk.
The higher the proportion of animals in milk, the lower the cost of milk
production. The proportion of animals in milk was generally higher in
commercial farms than in small and medium-sized farms.
The
productivity of milk animals is of vital importance to livestock owners because
it has a direct influence on costs and returns. Therefore, the average milk
yield of lactating animals was worked out (Table 5.14). The average milk yield
per day of lactating cows and buffaloes was higher in the northern region than
in the western region. The average productivity of crossbred cows was significantly
higher than that of buffaloes. Commercial farmers have marginally higher yields
in the northern region, while in the western region there were not large
variations across different size groups. One of the reasons for less variation
in the western region could be good networking of cooperatives, which are more
beneficial for small farmers in terms of access to output markets and animal
health care facilities. There are flush and lean seasons in milk production,
which differ for cows and buffaloes. The average productivity during a lean
season is substantially lower than during a flush season. The average
productivity in cows during a flush season was as high as 16 liters in the
western region and 15.2 liters in the northern region.
Table 5.14 Average milk yield per lactating animal in
different categories of households (liters/day)
| Farm
Size |
Cows
|
Buffaloes
|
Peak
|
Average
|
Peak
|
Average
|
| Northern
Region |
| Small |
14.6
|
9.0
|
101
|
6.0
|
| Medium |
13.8
|
9.4
|
9.8
|
6.7
|
| Large |
14.5
|
10.6
|
9.6
|
7.2
|
| Commercial |
17.0
|
12.4
|
11.8
|
9.0
|
| All Farms |
15.2
|
10.2
|
10.1
|
6.9
|
| Western
Region |
| Small |
14.1
|
7.2
|
8.9
|
4.6
|
| Medium |
15.4
|
6.8
|
10.3
|
4.8
|
| Large |
15.2
|
7.4
|
10.9
|
4.8
|
| Commercial |
17.6
|
7.6
|
11.4
|
5.2
|
| All Farms |
16.0
|
7.3
|
10.7
|
4.9
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
5.3 Milk Production, Consumption, and Disposal
Patterns
Milk is an important and comparatively cheap source of
nutrition in rural areas of the country. The smallholder dairy farming system
provides a variety of outputs, such as milk, organic manure, draft power, and
cash income. The farmers retain part of the milk for home consumption (liquid
milk and milk products) and sell the rest in the market to get cash income. The
milk production, consumption, and disposal pattern is given in Table 5.15. The
average milk production per household has a direct relationship to farm size.
The average share of milk sold is higher in the western region than in the
northern region. The average per capita consumption of milk per day is higher
in the northern region than in the western region owing to dietary habits. In
the western region, some of the farmers sell a large proportion of their milk
to dairy cooperatives and purchase ghee (clarified butter) from them for home
consumption, because when ghee is made through traditional methods at home there
is waste of by-products that can be used in the modern dairy product
manufacturing plants. This has all happened due to the efforts of cooperative
organizations in the area. In the western region, smallholders sell about 88
percent of total milk produced, which is higher than the northern region
(68.2%). Part of this difference might be distress sales due to the need for
immediate cash (based on informal discussion with sample households). The share
of milk sold was high among commercial farms, mainly due to their larger
production base and more market-oriented production objectives.
Table 5.15 Milk production, consumption, and disposal
pattern (liters per day)
| Size |
Production
|
Home consumption
|
Sold
|
% share of milk sold
|
| Northern Region |
| Small |
8.8
|
2.8
|
6.0
|
68.2
|
| Medium |
20.5
|
6.5
|
13.0
|
63.4
|
| Large |
54.9
|
7.7
|
47.2
|
86.0
|
| Commercial |
171.0
|
6.2
|
164.8
|
96.4
|
| All |
43.4
|
6.1
|
37.3
|
85.3
|
| Western Region |
| Small |
15.3
|
1.9
|
13.4
|
87.6
|
| Medium |
43.7
|
4.5
|
39.2
|
89.7
|
| Large |
75.4
|
5.1
|
70.3
|
93.2
|
| Commercial |
183.7
|
4.6
|
179.1
|
97.5
|
| All |
58.1
|
4.2
|
53.9
|
92.8
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
The average per capita availability/consumption of milk and milk
products was much higher in the northern region (1,016 grams/day) than in the
western region (700 gm/day). The average per capita consumption ranged from 560
grams per day for small households to nearly 1,100 grams for large households.
The average per capita consumption in the western region was lowest (380
grams/day) among smallholders and highest among commercial farms (766
grams/day). These consumption estimates might be slightly high, as we could not
get information about quantity of milk and milk products given as gifts to
neighbors and relatives, which is a common practice in rural areas.
Information on the average milk yields on the day before the
survey and information about the prices received by the sample households is
summarized in Table 5.16. There was no significant difference in buffalo milk
yield between the northern and western regions, but there were variations
across different sizes of farms. The difference in cow milk yield was
significant between the regions. The average price received by the household
for buffalo milk was about Rs. 11.6 per liter in both regions, while the price
received for cow milk was higher in the northern region. However, this table
gives more insights about the organizational structure of the dairy sector. One
of the interesting points that is evident from Table 5.16 is that smallholders
get lower milk prices in the northern region than in the western region. The
explanation for this could be the strong presence and networking in the western
region of cooperatives, which do not discriminate between small and large
producers and procure milk at a price based on fat and solid-not-fat (SNF)
content, irrespective of quantity of milk sold. In the northern region, the
presence of the organized/cooperative sector is very limited and producers are
at the mercy of the unorganized sector, mainly consisting of milk vendors/dudhias,
which give smallholders less bargaining power. One of the important inferences
that could be made from this observation is that in order to protect
smallholder milk producers, farmer-managed organizations and links between
producers and processors through formal or informal contracts should be
promoted.
Farmers sell milk to different agencies; important marketing
channels are presented in Figure 5.1. In the western region, dairy cooperatives
are a major agency for procuring milk from farmers; however, a small proportion
of milk produced is also sold to consumers, sweet shops, milk vendors/dudhias, and private dairies. The proportion of
dairy farmers selling milk to the unorganized sector is quite high and accounts
for a large share of marketed surplus in the northern region. We investigated
the reasons for selling to a particular agency. The household was asked to rank
the first three important reasons for selling milk to a particular agency, and
weights were assigned per the importance of the reason (most important = 3; second
important = 2; least important = 1). An index was constructed on the basis of
these weights. The results are given in Table 5.17. Dairy farmers in the
northern region cited price as the most important reason for selling milk to a
particular agency, followed by timely payment. In the western region, regular
procurement (2.45) was the most important factor in choosing the marketing
agency, followed by timely payment (2.33) and provision of animal health and
breeding facilities (2.12). One of the important points is that farmers in the
western region did not consider the price received as an important factor.
Other, less important, reasons given by households for selling milk to a
particular agency were correct measurement, pricing based
on fat and SNF, provision
of credit, and advance payments.
Table 5.16 Productivity levels and prices received by farmers
| Size |
Buffalo milk
|
Cow milk
|
Yield (lit./day)
|
Price (Rs./lit.)
|
Yield (lit./day)
|
Price (Rs./lit.)
|
| Northern Region |
| Small |
5.8
|
11.26
|
8.4
|
7.50
|
| Medium |
6.1
|
11.18
|
8.7
|
8.29
|
| Large |
6.7
|
11.94
|
11.7
|
8.56
|
| Commercial |
8.2
|
13.16
|
13.1
|
8.58
|
| All |
6.9
|
11.63
|
12.3
|
8.29
|
| Western Region |
| Small |
5.7
|
11.28
|
8.8
|
7.40
|
| Medium |
5.6
|
11.22
|
8.9
|
7.45
|
| Large |
5.9
|
11.64
|
9.5
|
7.50
|
| Commercial |
6.7
|
12.88
|
10.7
|
7.72
|
| All |
6.1
|
11.61
|
9.8
|
7.48
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
Figure 5.1 Milk marketing channels
Farmers were also asked about their future plans to increase milk
production. Fewer than half the farmers in the northern region planned to
increase milk production, while the proportion of households planning to
increase milk production in the western region was very high (82%) (Table
5.18). There, the proportion of farmers reporting plans to increase milk
production had an inverse relationship to the size of household, which might be
due to relatively large herd size among the large and commercial farmers in the
study area. Farmers who had plans to increase milk production were asked to
give three important ways to increase milk production, and an index was
constructed. In the western region, feed and fodder availability is a factor in
expanding milk-production activities (2.36), followed by better management
practices (2.27). In the northern region, farmers had plans to increase milk
production through better management, and their preference for buffaloes was
quite evident (Table 5.19). Farmers in the study area had good milk animal
breeds, so breed improvement does not seem to be an important issue in either
region.
Table
5.17 Reasons for selling to a particular agency
|
Remunerative price
|
Timely payment
|
Regular procurement
|
Pricing on fat & SNF
|
Correct measurement
|
Provision of services
|
Provision of credit
|
Advance payment
|
| Northern Region |
| Small
Farms |
3.00
|
2.83
|
1.50
|
1.87
|
1.71
|
-
|
-
|
1.35
|
| Medium
Farms |
2.83
|
2.72
|
1.30
|
1.58
|
1.83
|
1.00
|
-
|
1.06
|
| Large
Farms |
2.85
|
2.53
|
1.05
|
1.92
|
1.85
|
-
|
-
|
1.06
|
| Commercial |
2.76
|
1.00
|
2.45
|
-
|
1.88
|
-
|
-
|
1.33
|
| All Farms |
2.81
|
2.65
|
1.17
|
1.80
|
1.82
|
1.00
|
-
|
1.17
|
| Western Region |
| Small
Farms |
2.25
|
2.37
|
2.32
|
1.54
|
1.00
|
2.27
|
1.03
|
-
|
| Medium
Farms |
1.50
|
2.27
|
2.52
|
1.50
|
1.33
|
2.24
|
1.04
|
-
|
| Large
Farms |
1.71
|
2.46
|
2.45
|
1.24
|
1.00
|
2.04
|
1.15
|
-
|
| Commercial |
2.33
|
2.14
|
2.69
|
1.18
|
-
|
1.87
|
1.25
|
-
|
| All Farms |
1.92
|
2.33
|
2.45
|
1.44
|
1.00
|
1.12
|
1.09
|
-
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
Table 5.18 Households' plan to increase milk production
(%)
| Response |
Small
|
Medium
|
Large
|
Commercial
|
All
|
| Northern Region |
| Yes |
57
|
52
|
45
|
38
|
48
|
| No |
43
|
48
|
55
|
62
|
52
|
| Western Region |
| Yes |
84
|
90
|
79
|
60
|
82
|
| No |
16
|
10
|
21
|
40
|
18
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
Finally, farmers were asked to rank the three most
important constraints in dairy farming they had experienced, and an index was
constructed for different farm categories. The constraints were categorized
into technological, marketing, institutional, infrastructure, diseases, feeds,
and environmental constraints (Table 5.20). In the western region, shortage of
feed-particularly fodder-turned out to be the most important constraint (2.40),
followed by institutional constraints (2.20) and incidence of animal diseases
(2.12). In the northern region, technological constraints were the most
important (2.71), followed by institutional constraints (2.40), and
infrastructure (2.39). The institutional and infrastructural problems were
mostly related to the quality of infrastructure and institutional services in
general and public sector utilities in particular. Environmental issues were at
the bottom of the list.
Table 5.19 Ways to increase milk production
| Size |
Better breed
|
Increasing # of crossbred cows
|
Increase in number of buffaloes
|
More feeds & fodders
|
Better management
|
| Northern Region |
| Small |
1.61
|
1.85
|
1.89
|
1.38
|
2.16
|
| Medium |
1.66
|
1.89
|
2.04
|
1.50
|
2.14
|
| Large |
1.56
|
1.75
|
2.19
|
1.50
|
2.00
|
| Commercial |
1.30
|
1.73
|
3.00
|
1.33
|
1.89
|
| All |
1.53
|
1.83
|
2.06
|
1.43
|
2.07
|
| Western Region |
| Small |
1.79
|
2.22
|
1.86
|
2.41
|
2.31
|
| Medium |
1.20
|
1.95
|
1.40
|
2.06
|
2.30
|
| Large |
1.31
|
2.08
|
-
|
2.13
|
2.30
|
| Commercial |
1.26
|
2.43
|
1.00
|
2.55
|
2.00
|
| All |
1.32
|
2.18
|
1.67
|
2.36
|
2.27
|
Source:
IIM/IFPRI India Dairy Field Survey, 2002-2003
Table: 5.20 Constraints perceived by farmers in dairy
farming
| Size |
Technological
|
Marketing
|
Institutional
|
Infrastructure
|
Diseases
|
Feed
|
Environmental
|
| Northern Region |
| Small
Farms |
2.76
|
2.56
|
2.52
|
2.44
|
2.23
|
2.10
|
0.99
|
| Medium
Farms |
2.64
|
2.13
|
2.27
|
2.23
|
2.25
|
2.03
|
1.10
|
| Large
Farms |
2.73
|
2.15
|
2.30
|
2.46
|
2.21
|
2.00
|
1.42
|
| Commercial |
2.70
|
2.01
|
2.46
|
2.43
|
2.16
|
2.40
|
1.74
|
| All Farms |
2.71
|
2.28
|
2.40
|
2.39
|
2.22
|
2.14
|
1.39
|
| Western Region |
| Small
Farms |
2.12
|
1.83
|
2.04
|
2.13
|
2.08
|
2.40
|
0.99
|
| Medium
Farms |
2.07
|
1.59
|
2.22
|
1.94
|
2.14
|
2.25
|
0.99
|
| Large
Farms |
1.83
|
1.57
|
2.39
|
2.00
|
2.33
|
2.41
|
1.00
|
| Commercial |
1.82
|
1.52
|
2.42
|
1.98
|
2.42
|
2.77
|
1.63
|
| All Farms |
2.02
|
1.67
|
2.20
|
2.03
|
2.18
|
2.40
|
1.07
|
Source: IIM/IFPRI India Dairy Field Survey, 2002-2003.
5.4
Animal Health, Breeding, and Extension Services
Livestock services come mainly from the State Department of Animal
Husbandry, supplemented by cooperatives, the private sector, and non-government
organizations. There are veterinary polyclinics, veterinary dispensaries, first
aid veterinary centers, and mobile veterinary dispensaries in the country that
provide animal health care and breeding facilities. In addition, certain
central and centrally sponsored schemes/projects, such as the Intensive Cattle
Development Project (ICDP), provide services to farmers. The veterinary
institutions deliver curative veterinary services for all species of livestock
and artificial insemination (AI) for cattle and buffaloes. All services offered
by the department are delivered at the center, and livestock owners have to
take their animals to the center for treatment or for AI services. All services
offered by the department are supposed to be free or subsidized, but a study by
Ahuja et al. (2001) revealed that farmers pay a fairly high price for all these
services, and the quality of the services is poor. Budget constraints have
reduced government support to these institutions for salaries and establishment
costs. The Department of Animal Husbandry spends nearly 95 percent of its
annual budget allocations (public funds) on salaries and establishment costs.
In the northern region, government veterinary hospitals are the
most important providers of animal health and breeding services. Some of the
farmers are also getting these services from the private sector and, to a
limited extent, from cooperatives. Farmers are getting information about
prices, markets, and feeding and management practices through personal
contacts, followed by government extension agencies, state agricultural
universities, and traders/intermediaries. In the western region, a majority of
the sample households receive these services from the dairy cooperatives and
the State Department of Animal Husbandry; a few private sector veterinarians
supplemented these efforts.
