Dairy busines potential in pakistan
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Transcript of Dairy busines potential in pakistan
Dairy Business Potential in Pakistan Future Prospective and Possibilities
Dr. Muhammad Nasir JavedChief Executive Officer
Milko Foods0300-8432595
Presented by :
Faisalabad
Provincial Share in Milk Production
KPK
62%
12%
23%
3%
Punjab KPK Sindh Balochistan
Source : Pakistan Dairy Association Tetra Pak Pakistan internal data
4th largest milk producing nation
0%
10%
20%
30%
40%
50%
60%
70%
80%
90%
100%
Milk Production Urban - Rural Divide Milk Usage - Urban Urban Households'Consumption Split
9.25 Bio.Urban
consumption
19.65 Bio. Sold to market
7.64 Bio.Liquid Milk for
Urban household
consumption
1.5 Bio. Sold at loose Milk Shops
0.05 Bio.Pasteurized Milk Shops –
0.72 Bio. UHT in TP7.86 Bio.Wastage & calf
feeding
1.6Bio.Converted to milk products/sweets
11.8 Bio.Retained by
farmer
10.4 Bio.Rural consumption
0.17 Bio.Powder
39.3 Bio.
5.20 Bio. Gawala Milk
19.65 Bio. 9.25 Bio. 7.64 Bio.
15 % increas
e in Deman
d
3 % annual
increase in
Production
Farmer VMC
Sub Center
Gawala
Dairy Plant
Collection Point
ContractorsMini Suppliers
LooseMilk Shop
Consumer
Middleman is controlling majority of supply chain
79 %
Fragmented Farm Base
Livestock Census of Pakistan 2006
01 to 10, 74%
11 to 30, 10%
31 to 100; 13%
100 and above, 3%
10
CostQuantity Quality
Source: PDA & Market Feedback
Dairy Industry facing multiple challenges
► lowest yielding animals
► Small scattered farms
► Majority of animals owned by
poor smallholders
► Farmer has limited access to
formal markets
► Middlemen adulterate milk
► Poor storage & supply
infrastructure
► Feed prices increased by 16%
p.a. 2005-2008.
► Last 10 yrs. Milk and feed price
ratio not favorable
► Soaring inflation (current 24%)
11
010002000300040005000600070008000
NZ USA DEN PAK IND
NZ USA DEN PAK IND
Quantity Issues
Source: IFCN
0
50
100
150
200
250
NZ USA DEN PAK IND
NZ USA DEN PAK IND
► Small scattered farms
Animal Holding
80%
12%5%2%
0%10%20%30%40%50%60%70%80%90%
100%
Number of Animal per herd
0 to 5 5 to 10 10 to 20 20 & more
► 80% animals owned by poor smallholder
► Lowest Milk yield per animal
12
Quality Issues
Source: IFCN
► Limited farmers’ access to formal market
0
5
10
15
20
25
Punjab NWFP
Punjab Sindh NWFP Baluchistan
22.8B
illion
Liters
63%
► Supply demand gap is leading to adulteration
Supply deficit to be 6.6 bio lit. by 2020.
Tied up Animal ………Old Farming system
Current Progress in Dairy Sector
3000 + Commercial Farms with more than 200 animals
Top Corporate Dairy Farms in Punjab
Dairy Farms Milk Production LPD Supplying to Milk Price @ 13 % TS Rs.
Nishat Dairy 80,000 ENGRO/Haleeb 56.0/54.0Ever Fresh 18,000 ENGRO 54.0Interloop 30,000 ENGRO 54.0
Umer Dairy 24,000 Nestle 52.0Sharif Dairy 38,000 ENGRO 52.0Al- Tahure 18,000 ENGRO 54.0Dada Dairy 30,000 Nestle 54.0
Sapphire Dairy 40,000 Gourmet 56.0
ENGRO Farm 50,000 ENGRO 58.0
Total 273,000
History of Dairy Development in
Pakistan Investment in Private Dairy Sector 1982-84 ( 22 Dairy Plants)Agri-services concept by Private industry ( Halla , Nestle) in 1990Commercial dairy Farming and Private Artificial Insemination in
1994 Import of exotic dairy breeds by Private Industry ( Nestle) 1998New investors in Modern Dairy Farming Import of Exotic breeds Private dairy training centres/ Institutes 2008Extensive Development programs by Govt. and Private dairy Industry
and NGO 2005 - 2015
What is Way Forward
New Generation looking toward Policy Makers
Livelihood Through Livestock
Livestock Development Plan
Best Solution is Effective Extension Services
Support Community Development in the
area
Enable Skills Ideas, Information to be
mobilized
Promote Co-operation & collaboration
among Community
Commercial Sector
Village level CBO/
Societies
Farmers /Co-operatives
Universities or Research Institutes
NGO
Key Stakeholders for Extension Services
Impact on Pak Economy with only 500 ML milk increased by Extension services
Region Animal Population
Growth /Animal/day
Increase in Milk Production
(Annual)Value gain in PKR
45/Litre
Pakistan 54,000,000 500 ML 9,855,000,000 443,475,000,000
Milk Production impact Rs. 443 Billions
Equal to 50 years of Budget of Livestock development in Pakistan.
Nothing Is Impossible
Import of Dairy GeneticsTo fill the gap of milk shortages.Import of Friesian, Jersey and FxJ
cattle and embryos from Australia, Sweden and USA
More than 5000 cattle imported in 2011
Farm size from 50 to over 2500 cows18 Farms having environmental
control shedsChallenges of housing, summer
management, feeding and disease control
Any Question ???
UHT Product Costing
Losses (1%)
Processing Cost 4%
Sales & Marketing 4%
Distributor Margin 4%
Raw Milk 61%
Packaging 14%
Collection Cost 8%
Retailer Margin 4%