Macro Economic Variables affecting Dairy Industry

1. STUDY OF
MACROECONOMIC
VARIABLES ON DAIRY
PRODUCTS
•2020043 JITESH PARATE
•2020044 PRAKHAR GUPTA
•2020045 PRATYUSH CHAMARIA
•2020046 RACHNA GUPTA
•2020047 RITWIT SINGH
•2020048 ROSELLE DIAS
•2020063 VISHAN KHATAVKAR
Group-8

2. POLITICAL FACTORS AFFECTING DAIRY PRODUCTS
1. The Political History
Industries Development and Regulation Act 1951
Milk and Milk Product Order 1992
Amendments in MMPO in 2002
2. Regulatory Framework
Clean Milk Production Programme and its Objectives
3. Government Initiatives
National Programme for Dairy Development (NPDD)
National Dairy Plan (Phase-I)
Dairy Entrepreneurship Development Scheme (DEDS)
Support to Dairy Cooperatives
Dairy Processing and Infrastructure Development Fund (DIDF)

3. • Increase in income, is driving up consumption of dairy
products especially milk as it is become more of a necessity
than a luxury.
• With easing restrictions of COVID 19 and festive season
coming in, dairy producers expecting a rise in demand.
• If the Co-operatives obtain export subsidies to export
Skimmed Milk Product(SMP), Co-operatives, Private firms
and Dairy Farmers will find export avenues in foreign
markets.
1. Disposable Income of Consumers
Per capita income of India currently ​at Rs 11, 254 for the year 2019-
20.
Since March, demand for dairy products down by 60%
owing to restrictions​.
2. Export Avenues
India recorded exports worth Rs 1341.03 crores of dairy products
amounting to 51,421.85 million tonnes of dairy products.
Dairy Co-operatives currently seeking 20% export incentive
for Skimmed Milk Powder (SMP).
ECONOMIC FACTORS AFFECTING DAIRY PRODUCTS
Annual Dairy Exports

4. SOCIAL FACTORS IMPACTING DAIRY PRODUCTS
1.COVID-19 : 100% rise in demand observed as people went into ‘PANIC BUY’ mode in the
early days of lockdown.
2.Fake News: Shortly after lockdown one fake news about COVID spread from poultry
products forced people to shift their protein source to milk-based products like paneer.
•Now people are preferring UHT (Ultra Heat Treated) milk
over local milk vendors as this milk packet has longer shelf
life (when packed in tetra pack). This also reduces human to
human contact as compared to milk delivery from local milk
vendor.
•According to WHO reports, Coronavirus is here to stay. So
we can safely assume that future sales for pasteurized milk
(Packed in tetra pack) will either increase or will stay at this
high level for considerable amount of time.

5. The Technological Factors Affecting Dairy Products
The advances in technology changes how an industry operate and meet the demand. This environment factor affects
the dairy product category technologically
• Automation: - Use of Advance milking methods (AMS ,VMS)
• R&D Activity :- Artificial Insemination in Dairy animals is increasing to produce nutrient rich milk
• Level Of innovation :- Use of tetra pack instead of regular packs which have longer shell life and also
eco friendly packets. Canadian startup Soma Detect senses the health of the dairy animal along with
quality.
• Technological changes :- Milk-> Milk Powder, Online Dairy Products , GRAINZYME – Food For animals
• Sustainable Technology :- California Bioenergy - “barn to biogas” solution
0
20000
40000
60000
80000
12--13 13-14 14-15 15-16 16-17 17-18
57787 58839
63619 65567
70062 73070
Insemination000's
Years
Aritifical Insemination in Dairy Animals
Source :Basic Animal Husbandry Statistics, DAH,D&F, GOI

6. The Environmental Factors Affecting Dairy Products
• Greenhouse Gas (GHG) Emissions- Emissions from livestock account for about 14.5% globally and
roughly two thirds of those emissions come from cattle.
• Non-Renewable Primary Energy Use- About 60% of the energy used in feed production, fodder,
gazing and transport.
• Water Use- fodder production and cultivation needs water. acidification occur mostly in the dairy farm
phase which comes from ammonia due to fertilizer use.
• infectious diseases- Mastitis ,brucellosis, tuberculosis, Johne's disease are some examples of
infectious diseases.
• Unsustainable dairy farming- Dairy farming has a negative effect on ecological areas like prairies,
wetlands, and forests.

7. Demographic Factors Affecting Dairy Products
1- Change in India’s Share in Global Milk Production
1960- Milk Production was 17 to 22 million tonnes
2018- Milk production 176 million tonnes
Thus from a milk scarce nation to largest milk producing nation, India is now contributing 17% in total world milk
production
India ranks first in total milk production in world followed by the USA, China, Pakistan and Brazil since
1998.
2- Change in consumption pattern of milk and milk products in India:
The per capita consumption of milk has increased from 290 grams per day in 2011-12 to 375 grams per day in 2017-18.
•India exhibits an age old tradition of drinking milk. 89% of households in India consume loose milk whereas only 9% households use packaged
milk.
In past 10-15 years we have seen a drastic change in consumers preceptive towards packed milk and milk products, thus big milk brands like
AMUL, Mother Dairy, Nandini Milk etc have come up with various read-to-consume items such as:
•Probiotic Ice cream (Amul),
•Soya Milk
•Milk Powder
•Set curd,
•Good and long life UHT milk,
•Mastidahi,
•Ready to reconstitute basundi, kheer, rasmali, payyasam etc.
IN COVID SITUATION PEOPLE ARE TRUSTING MORE ON PACKED AND PASTEURIZED MILK.

8. LEGAL FACTORS IN DAIRY PRODUCTS
1. INFRINGEMENT MALPRACTICES
• Companies producing dairy products which are available Pan-India are facing the challenge of counterfeit from local regional players.
• In 2018, after two decades Amul wins a legal battle against Anul for selling pouched milk under the names of 'Anul Taza' and 'Anul Shakti.'
2. OTHER LEGAL ISSUES
• The company has faced legal issues in the recent past wherein Amul chose to advertise its products while disparaging the brand and products
of its rivals.
• In 2017, Hindustan Unilever filed and won a lawsuit against Amul in the Bombay High Court.
3. OVER USAGE OF MILK AS ANALOGUE
• The Food Safety and Standards Authority of India (FSSAI) has issued a new draft notification, proposing to prevent the use of the word on the
pack of non-dairy and plant-based dairy products. Its notification says the word milk should apply exclusively to animal-derived milk and its
products.