Shah emphasised that the dairy sector’s adaptability has enabled it to thrive in an in any other case difficult consumption atmosphere. Nonetheless, she additionally famous that fluctuations in uncooked milk costs stay a big problem for the trade. Edited excerpts:
The Financial Occasions (ET): India’s milk manufacturing stood at 239.30 million tonnes (MT) in 2023-24, a 3.78% enhance from the earlier 12 months. Nonetheless, this progress price alerts a slowdown in opposition to earlier years, with a 5.77% rise in 2021-22 and a 3.83% enhance in 2022-23. How do you clarify this?
Akshali Shah (AS) The slowdown in India’s milk manufacturing progress from 5.77% in 2021-22 to three.78% in 2023-24 displays rising feed prices pushed by inflation, provide chain disruptions, and stagnant farm-level productiveness. The restricted entry to fashionable breeding packages and farming methods additional compounds these challenges. Amid these challenges, the dairy sector’s resilience is notable. Rising well being consciousness and the shift towards protein-rich diets drive demand.
Globally, the dairy trade is projected to develop at a 3.8% CAGR between 2024 and 2032, in keeping with the IMARC report. India’s dairy trade has considerably outpaced this, rising at a ten.7% CAGR from 2018 to 2023, with the organised section increasing at 13.5%. It’s anticipated to keep up a CAGR of 14% from 2024 to 2032, fueled by urbanisation and shopper preferences for value-added merchandise.
ET: The Quick-Shifting Shopper Items (FMCG) sector has confronted challenges in current quarters attributable to sluggish consumption progress, impacting gross sales and income. How has India’s dairy market carried out over the previous few quarters?
AS: Whereas the FMCG sector has confronted challenges attributable to muted consumption progress in current quarters, India’s dairy market has demonstrated notable resilience. Regardless of inflationary pressures and fluctuating uncooked milk costs, the dairy trade has continued to develop, pushed by the rising demand for well being targeted, protein-rich diets and value-added merchandise.
Parag Milk Meals has successfully leveraged these traits via diversification and innovation. Whereas conventional merchandise like Gowardhan Ghee and Go Cheese stay staples in Indian households, the corporate has expanded its portfolio with premium choices resembling Satisfaction of Cows, a single-origin milk model catering to city shoppers looking for purity and traceability. Moreover, the introduction of lifestyle-oriented merchandise like Avvatar whey protein has addressed the rising demand for useful and health-driven meals choices.
By addressing various shopper wants from on a regular basis necessities to premium and health-centric choices, India’s dairy sector stays a powerful performer in an in any other case subdued consumption atmosphere. These methods mirror the shift in momentum in the direction of branded and value-added dairy merchandise, even amidst headwinds confronted by the FMCG trade.
Akshali Shah, Government Director of Parag Milk.
ET: How is the Indian dairy trade addressing the difficulty of fluctuating uncooked milk costs?
AS: Fluctuations in uncooked milk costs stay one of many greatest challenges for the dairy trade. At Parag Milk Meals, we’ve got taken a multi-pronged method to mitigate these results. By leveraging long-term farmer partnerships and adopting honest pricing mechanisms, we guarantee stability in procurement prices. Moreover, fashionable technological instruments like SAP HANA permit us to optimise provide chains, monitor procurement in actual time, and scale back wastage, straight tackling value volatility.
We additionally work intently with the farmer group to implement finest practices on the farm stage, resembling selling balanced feed formulations and environment friendly herd administration. These initiatives not solely enhance milk high quality, benefiting farmers but additionally assist to keep up relationships which finally resulted in milk procurement.
AS: What position does know-how play in boosting dairy effectivity and scalability?
ET: Expertise is revolutionising the Indian dairy trade, and at Parag Milk Meals, it’s integral to our operations. Instruments like SAP HANA present end-to-end visibility throughout the availability chain, enabling us to handle procurement, manufacturing, and distribution extra effectively. Predictive analytics helps us monitor milk yield traits and anticipate market demand, making certain that manufacturing is completely aligned with shopper wants.
Furthermore, automation in high quality management, resembling superior milk testing tools, ensures that solely the very best merchandise attain shoppers. On a broader scale, improvements like IoT-enabled sensors and AI-driven farm administration options are serving to farmers enhance yield and scale back environmental influence, laying the muse for a extra scalable and sustainable dairy ecosystem.
ET: How are milk producers addressing the demand for adulteration-free merchandise?
AS: Shopper demand for adulteration-free dairy merchandise has grown considerably in recent times. At Parag Milk Meals, we’ve got embraced this development by strengthening our give attention to transparency and high quality assurance. Our merchandise bear rigorous testing at each stage of the availability chain, and we work with farmers who adhere to sustainable farming practices to offer good high quality merchandise to our esteemed shoppers.
