Introduction

Abstract

Currently, India ranks first in the milk production throughout the world, which has increased from 20.8 million tonnes in 1970–1971 to 187.75 million tonnes in 2017–2018 with an increase of 88.9%. Among the states of the Indian subcontinent, Uttar Pradesh is the largest milk producer followed by Rajasthan and Madhya Pradesh (Table 1.1). The per capita availability in India increased from 178 gm/day in 1991–1992 to 394 gm/day in 2018–2019 (Table 1.2). Among the states, the per capita consumption of milk is highest for Punjab, i.e., 1181 g/day, followed by Haryana which is around 1087 g/day, while Mizoram has the least per capita availability which was recorded to be 64 g/day (Table 1.3). The agriculture and allied sectors contribute to around 17% to the total GDP while the livestock sector contributes to 4.9% as recorded in 2017–2018 (Table 1.4). The Indian milk processing industry is estimated to grow at a compound annual growth rate (CAGR) of ~14.8% between FY 2018 and FY 2023, and will reach INR 2458.7 billion in FY 2023. The India Dairy Industry is worth Rs. 5.4 trillion by value, having grown at a CAGR of 15% during 2010–2016. The major reason for the increase in the demand for milk in the country is owed to the increasing population and growing middle class. The majority of the milk produced in India is processed and marketed by the unorganized sector, which accounts for around ~81.1% of the Indian dairy and milk processing market in the FY 2018. The milk produced by the unorganized sector is generally produced in unhygienic environment that reduces the overall quality and nutrition levels of the milk produced. Apart from milk, value-added products such as butter, curd, paneer, ghee, whey, flavored milk, ultra-high temperature (UHT) milk, cheese, and yogurt also contribute to the revenue to the Indian dairy and milk processing industry. The market size of butter, curd, paneer, and ghee has grown by 14.5, 14.4, 14.1, and 14.4%, respectively, between 2016 and 2020. About 7% of the annual milk production is converted into Dahi. The market size for Dahi was INR 896 crores in 2008 while in 2015 it was INR 5038 crores with an annual growth rate of 28%. The current average growth rate of buttermilk worldwide is about 2–3%, the production recorded in 2011 was 1429 KMT which was increased to 1684 KMT in 2016. The forecasted CAGR of buttermilk is expected to be about 3.5% from 2016 to 2024 because of the increase in the demand of buttermilk powder. According to a recent report “Dairy Industry in India: 2013–2019,” the market of buttermilk has grown at a CAGR of approximately 21.4% in the period 2013–2019. The cheese industry in India is in its nascent stage, accounting to just around 1% of the total milk products and is consumed by the urban population. Cheese was first marketed in India under the brand name “Amul” in 1970s. The cheese industry is estimated to grow at about 10–12% per year in terms of volume and 16–17% per year in value terms. The per capita consumption of cheese in India is too low, i.e., 2.4 kg/annum as compared to that in the United States which is 20 kg/annum. The major variants of cheese in India are processed cheese, mozzarella, cheese spreads, flavored, and spiced cheese having a market value of ~Rs. 4.5 billion. Processed cheese has the maximum market share at 60% worth Rs. 2.7 billion, followed by cheese spread which accounts for 30% of market share. Currently, the market for cheese in India is worth Rs. 1250 crores and it is expected to grow at a CAGR of 18% during 2015–2020. The market for UHT milk has reached around INR 50.3 billion in 2018 with a CAGR of approximately 25% (2011–2018). This market is expected to grow and reach a value of INR 100 billion in 2021, which will grow further and reach up to INR 193.3 billion by 2024. Karnataka represents the largest market for UHT, followed by Maharashtra and Tamil Nadu. The major players involved in the market for UHT are the Gujarat Cooperative Milk Marketing Federation, Karnataka Milk Federation, Nestle, Tamil Nadu Cooperative, and Mother Dairy (Report by IMARC).