Aavin plans schemes to bring down milk production cost

Dairy, which has been a second source of income for thousands of rural farmers in the state, faced an unprecedented situation in 2022-23. A section of dairy farmers associated with Aavin diverted their produce to private milk companies for a higher price.

As a result, Aavin’s milk procurement declined by eight to nine lakh litres per day, affecting supply in Chennai and other parts of the state. This served as a wake-up call for Aavin to strengthen its milk supplier network without increasing procurement price.

While Aavin procures cow’s milk at Rs 35 per litre and buffalo milk at Rs 44 per litre, private companies offer Rs 6 to Rs 8 more per litre. Farmers incur an expense of Rs 55 a litre for producing cow’ s milk, milk producers association sources said.

Aavin claimed the increase in milk demand was due to outbreak of lumpy skin disease in Karnataka, Andhra Pradesh, Maharashtra, and other states, which affected milk production. Nevertheless, the federation of district milk producers union has decided to reinforce its milk supply network and implement programmes to lower milk production cost.

Minister for Milk and Dairy Development S M Nasar said Aavin has started administrative work to purchase two lakh crossbred milch cows. “A tripartite agreement will be signed between the farmer, Aavin and bank. Priority will be given to farmers who regularly supply milk to Aavin and those who own up to three cows. Aavin will also facilitate loans for farmers to purchase cows that can yield up to 10 litres milk per day,”

A buffalo calf rearing programme will also be launched to support farmers. “We will be providing free fodder and mineral mixture to buffalo calves from the age of six months to 32 months, as rearing buffalo calves is more expensive due to high feed requirements. The initiative will bring down Aavin’s reliance on butter to increase fat content in milk and also boost buffalo milk production,” Nasar said.

Aavin sources said a scheme for oestrus synchronisation will be introduced to assist farmers who are unable to afford the expenses associated with infertility in cows. “Farmers often sell cows that are facing infertility issues to meat traders at a very low price. Under the new initiative, around 20,000 cows will be treated annually to address fertility issues. This service will also be available to only those who supply milk to Aavin,” an official said.

Currently, cattle feed is being provided to milk suppliers at a subsidised rate of Rs 21 per kg. “Expensive nutritious fodder pellets produced by the agriculture department and quality fodder seeds and slips will be supplied to milk producers,” the official added.

Aavin has also decided to provide a 50% subsidy in insurance premium to five lakh dairy farmers under National Livestock Mission. In the previous year, 1.2 lakh farmers were provided subsidy. “Aavin milk suppliers will have to pay 1.5% of the coverage amount towards premium, while those who opt for individual insurance will pay 6% of coverage amount. This will bring down input cost of milk production substantially,” Nasar said.

M G Rajendran, general secretary, TN Milk Producers Welfare Association, said, “The old cow-calf rearing scheme has been reintroduced for buffalo. Unlike milch cows, buffalo will not get pregnant easily and farmers will have to spend more money on maintenance. The outbreak of lumpy skin disease has affected lakhs of milch cows across the country. While purchasing new cows, Aavin should take precautionary steps,” Rajendran said.

395 milk producers’ cooperative societies newly registered, 116 revived: Minister

Deepavali sale of Aavin sweets and milk products stood at Rs 116 crore last year. The products are being exported to various countries and sale is being promoted using various methods such as using push carts across the state, Minister for Milk and Dairy Development S M Nasar tells TNIE. In a bid to prevent malpractice, Aavin is implementing digitisation of its milk cards and primary cooperative societies.

Aavin’s market share is less than 20 % and much lower than state-owned federations like Amul or Nandini… Last year, 395 milk producers’ co-operative societies were newly registered and 116 were revived. We have taken steps to incentivise milk supply to Aavin societies. This includes our decision to purchase two lakh crossbred jersey cows from other states by facilitating loans to dairy farmers through NABARD. We have initiated infrastructure augmentation projects to increase milk handling capacity of our dairies up to 60 lakh litres a day.

During 2021-22, Aavin invalidated 80,000 fraudulent milk cards. However, there have been misuse of milk cards in Tambaram and other regions in 2022-23.   Milk cards are meant solely for domestic consumers. Aavin’s decision to insist for a copy of ration card or Aadhaar to renew milk card for full cream milk (orange) which is cheaper by Rs 14 litre has helped to eliminate bogus cards. As a result, sale of 85 lakh litres of milk per month in commercial market at subsidised prices has ended. Aavin has decided to introduce e-milk cards that will be linked to the beneficiary’s proof of identity. Consumers will be able to recharge e-milk cards online.

 Reduction in milk prices by Rs 3 per litre has resulted in a loss of earnings for Aavin.  As a service-oriented sector, our goal is not to operate for commercial gain. During Deepavali season, Aavin sweets and other milk products generated sale of Rs 56 crore in 2020, which increased to `116 crore in 2022. This was primarily due to the introduction of 17 new Aavin milk products. Apart from exporting Aavin products to foreign countries, we have also provided 33 Aavin push carts to women to promote women entrepreneurship. We plan to extend the sale of ice creams through push carts across the state.

Aavin terminated 201 staff directly appointed in eight district milk producers’ unions during the AIADMK regime. An internal committee report recommended action against the officials involved in the recruitment.  Multiple cases have been filed in the high court challenging the decision of Aavin. Based on the outcome, we will take action. Direct recruitment for district unions and Aavin has been handed over to TNPSC.