Agro-Food Processing : Technology Vision 2020 Cereals - Current Status & Vision

Current Status: Processing

Cereal processing sector consists of two segments, viz. the unorganized and the organized sectors. It is estimated that there were about 136,247 rice mills in India, but of this 66 percent was mainly huller and only 25 per cent was modern rime mills, however, in terms of total milling capacity, the huller accounted for only 36 per cent while the modern mills had a share of 55 per cent. The hullers were employment intensive, but they were also energy intensive and had a very poor recovery rate as compared to the shellers and modern mills as shown in the table below:

Table 1.2 Characteristics of Rice Milling (per Metric Tonne)

Type Average No. of persons employed Average HP used (percent) Rice recovery (percent) Broken rice
Huller 12 40 62-65 40-45
Sheller 10 30 65-70 10-12
Modern mills 6 20> 70-72 2-5

Studies carried out in the regions where the Operations Flood Programme has been implemented show that it has created a very favourable impact on the food intake, nutrition status, levels of income and standards of living of the households engaged in dairying activities as compared to those not engaged in dairying.

The programme has also produced many indirect benefits to the rural population. For instance, many interior villages have now telephone facilities at the milk cooperatives, a big communication gap which no one would have dreamt to bridge so easily. Similarly, dairying ha helped the economic emancipation of women in many villages.
Exclusive societies for women producers have been formed in some states like Tamil Nadu, where women have emerged as leaders and formed social groups to promote the welfare of women, especially those belonging to the economically weaker sections. All these developments clearly demonstrated that dairying can establish itself as a very effective instrument of socio-economic change in the rural areas.

The dairying sector has also the potential to remain as a fast growing sector. Milk is a very valued food in India. The income elasticity of expenditure on milk is estimated at 1.5. This figure could be even higher in the rural areas. With the rise in incomes, the population would consume more milk and milk products. Expenditure on milk and milk products accounted for a little over 9 per cent of the total household consumer expenditure for the economy as a whole. Even a marginal increase I expenditure on milk would provide a substantial boost to the milk production.

Global trade in 1992 was of the order of $11 billion in milk powder, $9 billion in butter and $ 3.5 million in cheese. India’s exports of dairy products are quite negligible. It is only in the last two years that small quantities of milk powder were exported as some surpluses were available.

However, the export opportunities are likely to become more brighter in the coming years in view of the phased reduction in subsidies given to milk producers in the developed countries and the opening up of their markets as a result of the new international trading arrangements envisaged after the Uruguay Round of trade negotiations.
There are, however, several constraints to increasing exports of our dairy products. The main constraints are poor Quality of raw milk, high level of pesticide residues, heavy metal content and the stringent packaging and labelling requirements in the international market. Hence, unless we are able to successfully overcome all these constraints, it would be difficult to exploit fully the newly emerging export opportunities even if surpluses are available.

The present study has carried out a detailed analysis of the current scenario in the mil sector. It has been found that further development in this sector is constrained by several factors which are listed below:

(i) Large number of unproductive cattle. Although India accounts for 344 per cent of the world cattle population, its share in global milk production is only 12 per cent.

(ii) Low milk yield: The average yield of milk per cattle in India is only 522 kgs as compared to 6555 kg in Denmark, 87067 kg in the United States and 9291 kg in Israel.

(iii) Absence of a national level breeding policy: Greater attention needs to be given to the up gradation of the quality of cows over wide areas in the southern and eastern regions of the country since milk yields of buffaloes have shown substantial, improvement, especially in the northern and north western regions. Scientific breeding of cows on a large scale is an important stake.

(iv) Many states are adopting inconsistent milk production policies which need to be rectified.

(v) Good quality feed is used only on a very limited scale due to faster increase in feed prices as compared to milk prices.

(vi) The facilities for animal health care are quite inadequate. Major diseases like under pest and FMD are yet to be eradicated. Expansion of veterinary services has to be give a high priority.

(vii) Dairying continues to remain as a secondary occupation, characterized by limited number of organized milk farms and limited adoption of scientific management techniques.

(viii) The chilling facilities are inadequate leading to higher frequency of collection.

(ix) Inadequate education and extension services are big handicaps to the farmers.

(x) The unorganized sector still dominates in milk production and distribution. The organized sector processes only 1.2 per cent of the total milk production.

(xi) The infrastructural facilities for collection and transportation of milk are quite poor.

The Operation Flood Programme has definitely played a vary important role in increasing the production and marketing of milk. There are nearly 67,000 cooperatives of milk producers in the country with a total membership of 8.7 million producers. Milk marketed under this programme has risen from 2,.8 million linters per day in 1980/81 to 8.6 million liters per day in 1993/94. on the other hand, the organized private sector has so far confined itself to the production of value-added milk products like infant milk food, milk powder, dairy whiteners, malted milk foods, chocolates, etc.,

The dairy industry has now been delicensed which enables the private sector to expand its share in the production and marketing of milk products.

The potential for the expansion of the organized sector exists since around 75 per cent of the milk marketed in the country is done through traditional private trade. The organized sector, mainly the cooperatives, has become the price/quality leader in the market which ahs ensured reasonable prices for both the milk producers and the consumers. This should facilitate the expansion of the organized sector in milk processing and marketing.

On the basis of the detailed examination of the current status of technology in production, processing, transportation and marketing of milk, the present study has made some detailed recommendations in the form of an action plan to facilitate the formulation of appropriate policy strategy in the short, medium and long term for the dairying sector. This action plan is given in Appendix 2.