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Case study: Dairy in Assam, NE India M. Lucila Lapar, Delia Grace, Asif Bin Qutub, Derek Baker, and Rameswar Deka A mini-symposium on Agribusiness and Food Safety 54 th AARES National Conference, Adelaide, SA 10 February 2010. Context (1). Rising demand for milk and dairy products.
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Case study: Dairy in Assam, NE India M. Lucila Lapar, Delia Grace, Asif Bin Qutub, Derek Baker, and Rameswar Deka A mini-symposium on Agribusiness and Food Safety 54th AARES National Conference, Adelaide, SA 10 February 2010
Context (1) • Rising demand for milk and dairy products. • Dairy development as a pathway out of poverty. • Operation Flood, successful white revolution in India, bypassed NE India. • Low levels of productivity (supply) and consumption (demand) in the region. • Agricultural diversification to address development challenge
Context (2) • Formal marketing of milk in Assam is relatively insignificant. • Traditional sector accounts for about 97% of the market opportunities for farmers. • For smallholder producers in areas with poor market access, there are likely to be no alternative market options besides the traditional market. • Thus, developments in the traditional market presents livelihood opportunities andcould complement current efforts to develop organized milk coops.
Background of the study • Comprehensive study of the dairy sector in Assam – WB, DDD, ILRI, national partners • Empirical information for Pro-Poor Dairy Development Plan for Assam • Three main components: • - study of consumers, • - study of milk market agents, • - study of milk producers
Market actors in the dairy value chain • Formal agents: dairy cooperatives societies, private and governments processors/ plants. These agents buy fresh milk, process some, and sell two types of products: liquid milk and dairy products. • Shops include milk shops, milk bars, sweet shops, grocery shops and supermarkets. These agents buy fresh milk, process some, and sell two types of products: liquid milk and dairy products. • Processors include small scale processors. These agents buy fresh milk and process it into other products. • Traders represent all types of traders, i.e. mobile traders, wholesalers etc.. These agents do NOT process fresh milk. They buy and sell fresh milk.
TRADERS PROCESSORS FORMAL LOCAL PRODUCTION (347 Million litres X 17% marketed= 59 Million litres ) IMPORTS ??? 3% 31% 66% 5% 2% 45% 48% 13% 12% 75% 72% 28% SHOPS 100% 27% <1% 26% 46% CONSUMERS (in litres milk equivalent) (???)
Per capita consumption of milk and dairy products in Assam is lower than national average.
Raw milk is the most preferred form of dairy in Assam.
Urban consumers spend more on dairy products than rural consumers.
Drinking milk or white poison? • Adulteration – adulterants added to increase SNF content (e.g., urea, detergents, chalk powder, vegetable oil, paint, rice flour, wheat flour, starch, baking soda) and/or preservatives (e.g., caustic soda, baking soda) • Pesticide residues from fodder consumed by cows (DDT, MCH) • Bacteria – milking cows in unhygienic conditions • Hormone injections – e.g., oxytocin to induce labor
The dairy value chain in Assam Raw milk processor Retail outlet consumer trader farmer Processed dairy products
“ I am well satisfied with the level of hygiene and quality of milk available.”
“ I am well satisfied with the purity of raw milk being sold by milk vendors.”
Hygiene score : incentives for hygiene increases the nearer to consumption point
Perfect test Consumer judgement Completely useless test Ability of consumers to judge adulteration
Consumer self-evaluation • Perception • 4% said excellent judges • 34% said good judges • 55% said fair judges • 7% said poor judges • Reality • Only 10% scored better than chance
Conclusion: milk quality • Adulteration widespread • Most milk sub-standard • Milk handling practices poor • Relation between handling and safety
Implications for dairy-based agribusiness • Taste preference a key factor for observed milk consumption patterns in Assam; raw milk consumption predominant, liking for processed dairy products increasing from a low base. • Potential for developing rural-based enterprises in traditional dairy products processing.
Implications for dairy-based agribusiness • Generic promotion campaign can increase consumer awareness of nutritional benefits from consuming milk. • Consumer preference for outlets that they trust, e.g., direct from producers or can guarantee quality and safety. • Certification scheme (+ training in milk handling) for informal milk vendors that are predominant outlets in urban areas.