CASE STUDY

TAILOR MADE PRODUCTS AND PROCESSES FOR DAIRY
VALUE CHAIN

The Dairy value chain can be defined as the full range of activities required to bring milk or a milk product to final consumers passing through the different phases of production, processing and delivery. It can also be defined as a market-focused collaboration among different stakeholders who produce and market milk and related value-added products. When Swikriti Agro commenced its operations in Bhojpur district in Bihar, the research showed that Dairying was an important secondary source of income for more than 70% of families in the district and had assumed the most important role in providing employment and income generating opportunities particularly for women. At the same time, the milk processing infrastructure and capacity set up in the district remained underutilized. Swikriti found this value chain to be promising; where it could make a difference to the dairy value chain actors by its financial services interventions.

Increase in scale of operations and financing needs

Decrease in number of players

Dairy Value chain Players

1
Finance for business expansion
2
WC for inventory
3
Finance for purchase of animals
4
WC to cover feed cost (payments received in batches) No specific financial need
WC to cover feed cost (payments received in batches) No specific financial need
  • Offer credit to producers at effective rate of 50% p.a.
  • No specific needs
  • Receive milk on credit of 7-15 days. NA In put suppliers Primary producers
  • Collection agents Dairy processing unit Sales Small local retailers Urban
    wholesalers
  • Small scale producers (<5 animals)
  • Medium scale producers (5-10 animals)
  • Dairy owners (>10 animals)
  • Agents for cooperative societies
  • Agents for private dairies
  • Chilling centre
  • Processing plant liquid milk
  • Processing plant- milk and by products
  • Sales team of diary units
  • Sales network Profile of value chain players Decrease in number of players
  • What are the financial needs of these players
SWIKRITI AGRO’S INTERVENTION IN DAIRY VALUE CHAIN.
1
Short term loans for input suppliers and milk aggregators/collection agents.
2
Asset finance loans for purchase of cattle, commercial vehicles, and equipments. 

Swikriti’s Objectives

To promote increasing milch animals per household or setting up of modern dairy farms for the production of clean milk; To encourage self employment and to encourage set up of small businesses around milk like tea shops, ice creams manufacturing units, khoya plants; To encourage setting up of milk transportation activity by financing LCVs; To facilitate up-gradation of quality using advanced technological equipment to handle milk on a commercial scale. In addition to the above, risk mitigation products (insurance for lives and cattles, vehicle insurance etc) were introduced to de-risk the value chain from external events. Swikriti Agro, through its catalytic interventions in dairy farming, milk automation and measurement systems, network of transporters and bulk milk chilling plants, will strengthen the milk value chain and take it to a higher equilibrium than what it currently operates.

product img
Translate To Hindi»