The Amul dairy plant at Anand in Gujarat

Guwahati, July 21: The dairy sector in Assam may be in for better times, as the country’s market leader, Amul, is starting operations in the state.

“We shall replicate the Amul model in Assam to help local dairy farmers and will launch our products within three months,” Amul Dairy managing director Rahul Kumar told The Telegraph.

The Amul model of dairy development is a three-tier structure with dairy cooperative societies at the village level federated under a milk union at the district level and a federation of member unions at the state level. This ensures establishment of a direct linkage between milk producers and consumers by eliminating middlemen, while milk producers (farmers) control procurement, processing and marketing of their produce. Professionals manage the branding and sales processes.

The Gujarat Cooperative Milk Marketing Federation Ltd — India’s largest food product marketing organisation with an annual turnover (2012-13) of US$ 2.54 billion — is the apex organisation that controls marketing and sales, including exports, of Amul and Sagar products. Its daily milk procurement is approx 13 million litres per day from 16,914 village milk cooperative societies, 17 member unions covering 24 districts, and 3.18 million milk producer members. It operates through 48 sales offices and a dealer network of 5,000 dealers and 10 lakh retailers — one of the largest such networks in India.

Assam is the second state in the Northeast after Sikkim where Amul is starting operations.

Kumar said this came about after officials from Assam dairy development and cooperation departments had visited them and urged them to help enhance local milk production using the Amul model.

Siddeque Ahmad, minister of state (independent charge) for cooperation, had visited Amul Dairy on August 11, 2011, accompanied by V.K. Pipersenia, principal secretary, cooperation, and other officials to study Amul’s success story. They also discussed the prospects of a similar model in Assam.

Kumar said they would start production in the Prithvi Dairy plant here. The plant, which started its operations in 2007, has a capacity of processing 50,000 litres of milk per day. “My officials have been visiting Prithvi Dairy and a business model is being worked out. It is too early to say whether we will take over the plant but we will definitely make our entry from here,” he said, adding that Amul milk and paneer would be launched initially.

Sources said Prithvi Dairy, a unit of Prithvi Group of Industries, had not been performing well since its inception and they were willing to hand the plant over to a good company.

Kumar said Amul would work with local farmers under the well-established Amul model. “Amul would take care of the farmers by supplying them with good quality cattle feed, veterinary services and other major inputs to boost milk production. However, the main focus would be to create village-level cooperative societies that would be managed by duly elected farmer organisations only. We would also be working closely with Assam dairy development department officials,” he said.

“Amul prices are always value for money,” Kumar said when asked about the pricing of its products.

The total milk production in Assam in 2010-11 is 833 million litres, a slight increase from the 830 litres in 2009-10, but the requirement is much more. It was 2,308 million litres per day in 2010-11 and 2,286 million litres in 2009-10.

The per capita availability of milk in Assam during 2010-11 was, however, 74grams, which is far below the Indian Council of Medical Research recommended quota of 208grams per day.

According to Economic Survey of Assam (2012-13), the dairy development department has been focussing on increasing milk production as well as creating processing facilities for economic uplift of rural dairy farmers.

On entry of Amul in Assam, West Assam Milk Producers’ Cooperative Union Limited (Wamul) managing director M. Thakur said they had to prepare for competition.

Wamul sells its products under the brand name Purabi, which has become a household name and has met with some success in recent years after going through a rough patch since its inception. Its average milk sale per day was about 1,800 litres in 2007-08 that reached 32,700 litres in 2011-12. The present sales figure is around 42,000 litres per day. At present, Wamul’s distribution network consists of 44 routes, 1,477 retailers in 27 towns.