Dairy India is both the largest consumer and producer of milk in the world

Dairy india is both the largest consumer and producer

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DairyIndia is both the largest consumer and producer of milk in the world. Given the ubiquity of cattle, milk is an essential component ofthe dietary regime, resulting in high per capita consumption - at 47.4kg in 2016 - given the country's income level. Half a centuryago, India was the largest net importer of milk in the world, but a drive spearheaded byAmul Dairy, dubbed the 'white revolution',has made India self-sufficient in its dairy requirements.Expansion in the Indian dairy industry has been mainly led by private investors and cooperatives. Along with the rise of artificialinsemination services, herd numbers are boosted consistently. Given the ubiquity of cattle in India, milk forms a vital dietarycomponent, especially since most rural inhabitants own at least one cow. Buffalo are preferred for their high-fat milk content andtheir adaptability to Indian agricultural conditions. According to the National Dairy Development Board, consumer demand for milkand milk products is growing at approximately double the growth rate of production. As a result, strong dairy demand continues tofuel herd growth, and has also paved the way for improved management practices.We believe that these gains will be fuelled by per capita income and population growth, which will lead to greater demand for high-value dairy products such as cottage cheese and yoghurt, and higher per capita consumption of milk. Another growth driver will betargeted marketing campaigns from large multinationals such asWalmartseeking to establish their presence in the consumerfoods market.India's growing middle class and rising wages at lower income levels are leading to strong domestic consumption growth in thedairy sector. Reports suggest that the double-digit growth in the demand for value-added dairy products, such as cheese,dahi(yoghurt) and probiotic drinks, is quickly outpacing that of dairy production in India. On the back of this, Indian food conglomerateBritannia Industries is seeking a partner to strengthen its dairy business segment and to trim down the number of brands as part ofits strategy to focus on higher margin products.Our Agribusiness team forecasts milk production to remain strong over the next few years, fuelled by a continuous flow ofinvestment. Major international dairy producers have strengthened their presence in India over the past few quarters. In 2013,Nestlé India acquired a 26% stake inIndocon Agro and Allied Activities, a company engaged in milk collection in western India.In January 2014,Groupe Lactalisentered the market with the acquisition ofTirumala Milk Products, south India's secondlargest milk supplier. In addition, the private and public sectors are working towards increasing yields. In 2010, the government,together with the National Dairy Development Board, drew up a National Dairy Plan, which would see the investment of USD378mnaimed at doubling the country's milk output by 2020.
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  • Summer '18
  • Sagar Arora
  • ........., Alcoholic beverage, Food processing

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