Business Daily from THE HINDU group of publications
Tuesday, Feb 20, 2007
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Business Daily from THE HINDU group of publications Tuesday, Feb 20, 2007 ePaper |
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Agri-Biz & Commodities
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Dairy & Dairy Products Corporate - Outlook Hatsun Agro targets 4,000 `pure' dairy farms Harish Damodaran
White Gold project But that could well change. The Chennai-based Hatsun Agro Product Ltd is looking at creating around 300 `pure' dairy farmers within the next year, to be scaled up to 4,000 as part of an ambitious five-year White Gold project. "Each of them will keep 30-40 cows, giving an average 10-12 litres milk daily over 300 days. At Rs 10 a litre and a margin of Rs 3-3.50, they can net Rs 25,000-30,000 per month", said Mr R.G. Chandramogan, Managing Director of the Rs 550-crore company that procures 13 lakh litres per day (LLPD) on an average, making it India's largest private sector dairy concern.
Huge farms
So, would these be huge European or New Zealand-type farms? "Not at all. We are talking of five-acre farms, in which 3.5 acres will be set aside to grow Co3 (a bajra-napier hybrid fodder), one acre for desmanthes (a lucerne fodder with twice the protein content) and half acre for multi-cut sorghum. In addition, you need about 0.1 acres to house the stalls and milking parlour space for 40 cows, at 90 square feet (436 square feet equals 0.01 acres) per animal," he noted. "We are targeting 5-6 acre farmers, who will predominantly grow fodder and add value to their crop by converting into milk using cows". But how viable is this model, which Hatsun claims to have tried out successfully so far on 28 farms in Salem and Namakkal districts? "In our model, an average 35-cow farmer rakes in an annual return of Rs 3.75 lakh or Rs 75,000 per acre. Even in sugarcane, you rarely get more than Rs 25,000", Mr Chandramohan said.
Project objective
The White Gold project aims to establish the profitability of five-acre `pure' dairy farms and bring down milk production costs through a mix of high herd size, better feeding practices and selective mechanisation. "For our conditions, 35-40 animals is the right size, beyond which supervision costs and other overheads go up", he added. "By increasing the daily Co3 ration from 25 kg to 40 kg per animal and feeding them seven kg of desmanthes and an extra 0.25 kg of groundnut cake, milk productivity can rise from 10 to 15 litres. Also, by raising fodder yields and using rain-guns, brush cutters and milking machines, we have demonstrated up to 50 per cent savings in water and labour, and reduction in feed costs alone from Rs 7.1 to Rs 5.1 a litre. The total cost can be kept inside Rs 6.50 a litre, giving a Rs 3.50 margin on a Rs 10 sale price", explained Dr M. Subash Chandra Bose, a fodder consultant with Hatsun. Hatsun currently procures milk from three lakh-odd farmers. The 4,000 model farms that Mr Chandramohan hopes to have in place over five years would deliver roughly the 12-13 LLPD it is already collecting. "It costs me Rs 1.10-1.20 to transport every litre from so many farms to the plant. I hope to bring this down now by at least 35 paise," said Mr Chandramohan. The model dairies involve farmers investing about Rs nine lakh, of which Rs six lakh is on the animals and rest on sheds and assorted machinery. "We have arranged loans from ICICI, City Union and Indian Bank and also cost-effective bulk purchases from equipment suppliers", he added.
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