PROJECT REPORT

ON
PROCESS OF DAIRY PRODUCTS

FARM
SY NO 4/3, KATRENIPADU VILLAGE AND
MANDAL, EAST GODAVARI DIST.
 EXECUTIVE SUMMARY OF THE PROJECT PROFILE

1. Name of the unit. : RAMBABU DAIRY FARM

2. Location of the Farm. : Sy No 4/3, Katrenipadu Village and Mandal,

East Godavari Dist

3. Line of activity. : Dairy Farming (Production of Milk)

4. Constitution. : Proprietory

5. Sector. : Agriculture.

6. Name of the Promoter. : Sri T Rambabu

6. Project Cost & Means of Finance

(Rs in lacs)
Particulars Amount Particulars Amount
Land Own Capital 29.80
Sheds construction 25.00 Term Loan 89.4
Animals & other 70.90
expenses
Recurring Expenses 23.30
Total 119.2 Total 119.2
 INTRODUCTION

Milk production assumes second priority after rice cultivation in India agriculture.
The village economy is incomplete for marginal farmers if they lack one or two bovine
animals. The fact the about 75% population of India is engaged in agricultural
activities has put the organized milk production on prime priorities of Government
and other organizations. In this context operation flood and consequent thresh-hold
of white revolution has come through the Co-Operative pattern of milk production
management. Consequently more than 5 million farmers are today organized into
about 0.5 lacks of village milk Co-Operatives and the turnover of Dairy sector has
reached to Rs. 30.00 crore per annum.

The milk production in Indian set up is largely a source of supplementary income

to the farmers who product milk basically for self consumption and may spare the
surplus for the market. The problem of Dairy industry the Indian context are unique
in the sense that through India account for probably the largest bovine population in
the world yet it Indian Dairy has been the low intensity dairying based on poor
yielding cattle fed on crop and labour intensive management.

However, with the efforts of different agencies in various states, the

development of Co-Operative system in the sector which has tried to integrate both
technology of milk production and its subsequent marketing had led to steady growth
of five percent per annum. Since the cost of production per litre of milk has been
found to have inverse relationship with the productivity, the aim of Co-Operative
movement in India has been no upgrade the productivity along with the efficient
marketing management so that a fruitful source and sink relationship is maintained to
benefit of marginal farmers.
 SCOPE OF THE PROJECT

The project envisages for Dairy form. The cost of the project is estimated at Rs.
119.20 lakhs the installed capacity of the plant is 1000 litres per day on 300 days
working. The capacity utilization is assumed to be at 70% in 1 st year, 80% in 2nd year
and 90% in 3rd year onwards.

SECTOR AND CONSTITUTIONS:

A Farm by name and style RAMBABU DAIRY FARM is a proprietary concern,

the main object of the farm is to Milk from Buffaloes. The Farm comes under
Agricultural sector and does not require any registration.
Name of the Promoter:
1. Sri T Rambabu

PROMOTERS BACKGROUND :

1. Sri T Rambabu , S/o. Sri T Achiyya, aged 42 years is residing at 1-70/1,

Katrenipadu Village and Mandal, East Godavari Dist. He is the Sole proprietor
of the firm. He is well versed in cultivations. His family are having good back
ground in Cultivation and Animal Husbandry. The promoter got good experience
in the animal farm. He has got knowledge in the raring of the Buffaloes and the
marketing of Buffaloes milk and its by-products. With this experience he can
manage the farm in a profitable manner. He is an income tax assesse.
 MARKETING PROTENTIAL

In India, every one demands milk, but doe not get it. The production of milk is
mainly a rural activity. Its output varies from region to region. The modernization of
dairying has had its impact in all levels from the production of milk in rural areas to
its handling, transportation, processing and retailing to other urban consumer. With
the increasing demand of milk production in the country, the surplus milk needs to be
converted to long self life production.

Operation flood project has emerged as a highly successful and a very promising
pro gramme of Indo Eec Co-Operation in the last 20 years.

The promoter has got tie-up with City milk for supply of the milk in bulk. The
promoter will sell all the milk produced in the farm to the said Dairy daily.

DAIRY PROCESSING:
Originally, milking and processing took place on the dairy farm itself. Later, cream was
separated from the milk by machine on the farm, and transported to a factory to be made
into butter. The skim milk was fed to pigs. This allowed for the high cost of transport (taking
the smallest volume high-value product), primitive trucks and the poor quality of roads. Only
farms close to factories could afford to take whole milk, which was essential for
cheesemaking in industrial quantities, to them.

Originally milk was originally distributed in 'pails', a lidded bucket with a handle. These
proved impractical for transport by road or rail, and so the milk churn was introduced, based
on the tall conical shape of the butter churn. Later large railway containers, such as
the British Railway Milk Tank Wagon were introduced, enabling the transport of larger
quantities of milk, and over longer distances.

The development of refrigeration and better road transport, in the late 1950s, has meant that
most farmers milk their buffaloes and only temporarily store the milk in large
refrigerated bulk tanks, from where it is later transported by truck to central processing
facilities.

In many European countries, particularly the United Kingdom, milk is then delivered direct to
customers' homes by a milk float.
Milking machines

The milking machine extracts milk from all teats.

Milking machines are used to harvest milk from buffaloes when manual milking becomes
inefficient or labour-intensive. One early model was patented in 1907. [10] The milking unit is
the portion of a milking machine for removing milk from an udder. It is made up of a claw,
four teatcups, (Shells and rubber liners) long milk tube, long pulsation tube, and a pulsator.
The claw is an assembly that connects the short pulse tubes and short milk tubes from the
teatcups to the long pulse tube and long milk tube. (Cluster assembly) Claws are commonly
made of stainless steel or plastic or both. Teatcups are composed of a rigid outer shell
(stainless steel or plastic) that holds a soft inner liner or inflation. Transparent sections in the
shell may allow viewing of liner collapse and milk flow. The annular space between the shell
and liner is called the pulse chamber.

Milking machines work in a way that is different from hand milking or calf suckling.
Continuous vacuum is applied inside the soft liner to massage milk from the teat by creating
a pressure difference across the teat canal (or opening at the end of the teat). Vacuum also
helps keep the machine attached to the cow. The vacuum applied to the teat causes
congestion of teat tissues (accumulation of blood and other fluids). Atmospheric air is
admitted into the pulsation chamber about once per second (the pulsation rate) to allow the
liner to collapse around the end of teat and relieve congestion in the teat tissue. The ratio of
the time that the liner is open (milking phase) and closed (rest phase) is called the pulsation
ratio.

The four streams of milk from the teatcups are usually combined in the claw and transported
to the milkline, or the collection bucket (usually sized to the output of one cow) in a single
milk hose. Milk is then transported (manually in buckets) or with a combination of airflow and
mechanical pump to a central storage vat or bulk tank. Milk is refrigerated on the farm in
most countries either by passing through a heat-exchanger or in the bulk tank, or both.

The photo to the right shows a bucket milking system with the stainless steel bucket visible
on the far side of the cow. The two rigid stainless steel teatcup shells applied to the front two
quarters of the udder are visible. The top of the flexible liner is visible at the top of the shells
as are the short milk tubes and short pulsation tubes extending from the bottom of the shells
to the claw. The bottom of the claw is transparent to allow observation of milk flow. When
milking is completed the vacuum to the milking unit is shut off and the teatcups are removed.

Milking machines keep the milk enclosed and safe from external contamination. The interior
'milk contact' surfaces of the machine are kept clean by a manual or automated washing
procedures implemented after milking is completed. Milk contact surfaces must comply with
regulations requiring food-grade materials (typically stainless steel and special plastics and
rubber compounds) and are easily cleaned.

Most milking machines are powered by electricity but, in case of electrical failure, there can
be an alternative means of motive power, often an internal combustion engine, for the
vacuum and milk pumps.
Milking shed layouts

Milking parlour at Pardes Hanna Agricultural High School, Israel

Bail-style sheds

This type of milking facility was the first development, after open-paddock milking, for many
farmers. The building was a long, narrow, lean-to shed that was open along one long side.
The buffaloes were held in a yard at the open side and when they were about to be milked
they were positioned in one of the bails (stalls). Usually the buffaloes were restrained in the
bail with a breech chain and a rope to restrain the outer back leg. The cow could not move
about excessively and the milker could expect not to be kicked or trampled while sitting on a
(three-legged) stool and milking into a bucket. When each cow was finished she backed out
into the yard again. The UK bail, initially developed by Wiltshire dairy farmer Arthur Hosier,
was a six standing mobile shed with steps that the cow mounted, so the herdsman didn't
have to bend so low. The milking equipment was much as today, a vacuum from a pump,
pulsators, a claw-piece with pipes leading to the four shells and liners that stimulate and suck
the milk from the teat. The milk went into churns, via a cooler.

As herd sizes increased a door was set into the front of each bail so that when the milking
was done for any cow the milker could, after undoing the leg-rope and with a remote link,
open the door and allow her to exit to the pasture. The door was closed, the next cow walked
into the bail and was secured. When milking machines were introduced bails were set in pairs
so that a cow was being milked in one paired bail while the other could be prepared for
milking. When one was finished the machine's cups are swapped to the other cow. This is the
same as for Swingover Milking Parlours as described below except that the cups are loaded
on the udder from the side. As herd numbers increased it was easier to double-up the cup-
sets and milk both buffaloes simultaneously than to increase the number of bails. About 50
buffaloes an hour can be milked in a shed with 8 bails by one person. Using the same teat
cups for successive buffaloes has the danger of transmitting infection, mastitis, from one cow
to another. Some farmers have devised their own ways to disinfect the clusters between
buffaloes.

Herringbone milking parlours

In herringbone milking sheds, or parlours, buffaloes enter, in single file, and line up almost
perpendicular to the central aisle of the milking parlour on both sides of a central pit in which
the milker works (you can visualise a fishbone with the ribs representing the buffaloes and
the spine being the milker's working area; the buffaloes face outward). After washing the
udder and teats the cups of the milking machine are applied to the buffaloes, from the rear of
their hind legs, on both sides of the working area. Large herringbone sheds can milk up to
600 buffaloes efficiently with two people.

Swingover milking Parlours

Swingover parlours are the same as herringbone parlours except they have only one set of
milking cups to be shared between the two rows of buffaloes, as one side is being milked the
buffaloes on the other side are moved out and replaced with unmilked ones. The advantage
of this system is that it is less costly to equip, however it operates at slightly better than half-
speed and one would not normally try to milk more than about 100 buffaloes with one
person.

80-stand rotary dairy that is fully computerised and records milk production
Rotary milking sheds

Rotary milking sheds (also known as Rotary milking parlor) consist of a turntable with about
12 to 100 individual stalls for buffaloes around the outer edge. A "good" rotary will be
operated with 24–32 (~48–50+) stalls by one (two) milkers. The turntable is turned by an
electric-motor drive at a rate that one turn is the time for a cow to be milked completely. As
an empty stall passes the entrance a cow steps on, facing the centre, and rotates with the
turntable. The next cow moves into the next vacant stall and so on. The operator, or milker,
cleans the teats, attaches the cups and does any other feeding or whatever husbanding
operations that are necessary. Buffaloes are milked as the platform rotates. The milker, or an
automatic device, removes the milking machine cups and the cow backs out and leaves at an
exit just before the entrance. The rotary system is capable of milking very large herds—over
a thousand buffaloes.

Automatic milking sheds

Automatic milking or 'robotic milking' sheds can be seen in Australia, New Zealand, the U.S.,
Canada, and many European countries. Current automatic milking sheds use the voluntary
milking (VM) method. These allow the buffaloes to voluntarily present themselves for milking
at any time of the day or night, although repeat visits may be limited by the farmer through
computer software. A robot arm is used to clean teats and apply milking equipment, while
automated gates direct cow traffic, eliminating the need for the farmer to be present during
the process. The entire process is computer controlled. [11]

Supplementary accessories in sheds

Farmers soon realised that a milking shed was a good place to feed buffaloes supplementary
foods that overcame local dietary deficiencies or added to the buffaloes' wellbeing and
production. Each bail might have a box into which such feed is delivered as the cow arrives so
that she is eating while being milked. A computer can read the eartag of each animal to
ration the correct individual supplement. A close alternative is to use 'out-of-parlour-feeders',
stalls that respond to a transponder around the cow's neck that is programmed to provide
each cow with a supplementary feed, the quantity dependent on her production, stage in
lactation, and the benefits of the main ration

The holding yard at the entrance of the shed is important as a means of keeping buffaloes
moving into the shed. Most yards have a powered gate that ensures that the buffaloes are
kept close to the shed.

Water is a vital commodity on a dairy farm: buffaloes drink about 20 gallons (80 litres) a day,
sheds need water to cool and clean them. Pumps and reservoirs are common at milking
facilities. Water can be warmed by heat transfer with milk.
Temporary milk storage

Milk coming from the cow is transported to a nearby storage vessel by the airflow leaking
around the cups on the cow or by a special "air inlet" (5-10 l/min free air) in the claw. From
there it is pumped by a mechanical pump and cooled by a heat exchanger. The milk is then
stored in a large vat, or bulk tank, which is usually refrigerated until collection for processing.
Dairy Development Programs: Benefits and Risks for
Smallholders - The Case of Andhra Pradesh, India

Andhra Pradesh is one of the agriculturally most advanced states

in India but still has high levels of rural poverty. Mixed crop-
livestock farming is the predominant farming system practiced by
over 80 percent of rural households in the state. Bovines account
for about 40 percent of the livestock population and milk is one of
the most important products of cattle and cow enterprises,
contributing over half of the value of total livestock output of the
state. Andhra Pradesh’s milk is produced by 5 million dairy
farmers, most of which own less than 2 hectares and 1 to 4 dairy
animals.

Although milk production has shown remarkable growth in Andhra

Pradesh over the past decade, the potential role of dairy farming
as a means to improve household incomes and create rural
employment is far from being fully exploited. For the dairy sector
to play a more prominent role in rural development there is an
urgent need to devise dairy development programs that are
affordable for and have significant impacts on the key production
and financial parameters of the predominantly small farms that are
typical for the region.

Current Situation of Dairy Farmers in Andhra Pradesh

Incomes of dairy households range from 1,000 to 4,000 US$ per

year. The share of off-farm income is relatively high for small
farms (80 percent) and decreases with increasing size of farm
holding. This clearly indicates that poor, often landless farm
households are mostly part-time farmers.

Total returns (cash and quantifiable non-cash benefits) per 100 kg

milk range from 18 to 27 US$. Farmers however incur total costs
of 16 to 38 US$ per 100 kg milk, when family labour (imputed at
local wage rates), land and capital are included. This means that
only a minority of farms make an entrepreneurial profit. On the
other hand, if family labour is excluded from the calculation, all
farms achieve a net dairy income of 5 to 10 US$ per 100 kg milk.
Due to the lack of better alternative uses of their production
factors, these returns to dairy production are sufficient for these
small farms to keep operating.

Returns to labour are inversely correlated to the cost of milk

production. While large farms (10 to 15 animals) achieve returns
to labour that are much higher than the local agricultural wage
rate, on the smaller farms returns to labour are around half of the
local wage rate.

Observed variation in performance of smallholder dairy farms,

however, indicates that there is significant potential to improve
livestock productivity in these production systems by improving
breeding, feeding and herd management, thereby increasing the
economic viability of the dairy enterprise.

At the farm level, initiatives that provide incentives to farmers to

keep more productive animals without compromising their ability
to work off-farm will be a necessary precondition to enhance dairy
development in the region. This will entail devising dairy
development strategies that are labour-saving, require little
investment and are of low risk.

Ex-Ante Assessment of Dairy Development Programs

Although large dairy farms represent a profitable enterprise in

Andhra Pradesh, the vast majority of smaller farms are
economically unattractive and would disappear as soon as farmers
have better alternatives. This critical situation of small-scale farms
persists in spite of numerous dairy development activities long in
existence in the state. Therefore, the farm-level impact of over 40
potential dairy development interventions covering feeding,
breeding, animal health and milk marketing on a typical 3-cow
farm was assessed through an iterative process that combined
detailed household and farm simulation with expert and farmers’
opinions and feedback. Several of the most promising
interventions were combined to a ‘Dairy Development Ladder’ to
assess whether the dairy competitiveness of small farms can be
brought up to that of the larger farms.

The assessment paid particular attention to the risks associated

with each of the programs by introducing stochastic variables into
the simulations, and thus also provided estimates of probabilities
of the programs leading to specified results.

Likely Program Impacts on Dairy Income

The ex-ante assessments reveal that most interventions indeed

raise dairy income and returns to labour, decrease the cost of milk
production and increase the likelihood of achieving selected
thresholds for the above parameters, thereby reducing the risk
inherent in dairy farming. For example, improved animal feeding is
likely to increase the return to dairy labour by an impressive 145
percent, lifting it above the regional wage level for unskilled
labour, while reducing the risk of falling below the current level of
returns from 0.45 to around 0.15. This implies that whichever
family member stays on the dairy farm, (s)he is likely to obtain a
higher notional wage than the family members working off-farm.
With such an attractive outcome the question of why not more
farmers are adopting better animal feeding practices arises.

The ex-ante assessment of the ‘Dairy Development Ladder’ shows

that smallholder dairy farms have the potential to become
competitive milk producers, reduce the risk inherent in farming
and substantially improve household income. As a consequence of
the sequence of interventions the farm develops in a gradual
manner, which should present a realistic development path, as it
draws on regional expertise and builds on local cases of
competitive milk producers.

The Importance of Risk and Diversification

Several factors may be the reason for the low adoption of dairy
improvement programs: (a) the low overall impact on household
income; (b) the risk associated with specialization in dairy and (c)
the higher requirement for working capital.

The dairy enterprise contributes 0.13 US$ or 16 percent to the

daily per capita household income. Consequently, even the most
promising dairy interventions are only expected to increase per
capita household income by 27 percent, whilst they require
substantial changes in farm management. Genetic improvement of
their dairy animals was provided by farmers as an example of how
they would have to stop grazing in public land and replace paddy,
their main staple food, with green fodder, while still producing for
a very unreliable market (milk vendors) or for a non-remunerative
milk price (from the cooperative), a risk they do not consider
worth taking.

Farmers participating in this study were not only highly risk averse
but they were also reluctant to make optimistic assumptions about
‘framework’ conditions for dairying such as more or better access
to water, working capital, health services and a remunerative and
reliable milk price. Smallholder farmers universally agreed that
without the above conditions in place to diminish or eliminate their
risk in adopting new technologies, they would not subscribe to the
main dairy development programs on offer, in spite of their
obvious potential benefits.

Implications for Dairy Development Programs

It is well-known that resource-poor farmers are, by necessity, risk

avoiders. Therefore, dairy development programs must
simultaneously improve the financial performance as well as the
risk profile of the targeted farms.

Dairy development programs are not normally conceived to

comprehensively address a wide range of factors, which however
determine their adoption and success. Undoubtedly, it is
questionable whether it would make practical sense for any one
program to tackle all of the identified issues, but a promising
approach could be to forge strategic partnerships among existing
programs which are likely to have strong complementary effects.

The need for one program to partner and build on another is

evident in the ‘Dairy Development Ladder’. The results indicate
that, gradually effective partnerships, among various programs
and with the farming community, can effectively lift small dairy
producers out of poverty through a competitive dairy farming
business, which provides not only an excellent wage level under
local conditions, but which is also well-positioned against
international competition in a global economy.
Dairy Entrepreneurship Development Scheme

Dairy Entrepreneurship Development Scheme is a Government of India

sponsored scheme to provide financial support to entrepreneurs to start
dairy and allied business. This scheme has come into effect from
1stSeptember, 2010.

Objectives

To promote setting up of modern dairy farms for the production of clean

milk,

To encourage heifer calf rearing thereby conserve good breeding stock,

To bring structural changes in the unorganized sector so that initial

processing of milk can be taken up at the village level itself,

To bring about up gradation of quality and traditional technology to handle

milk on a commercial scale,

To generate self-employment and provide infrastructure for unorganized

sector.

Activities covered and indicative unit costs:

Small dairy farms: Cross bred buffaloes, Indigenous descript breeds and
Graded buffaloes (up to 10 animals): Rs.10 lakh,

Vermi-compost (with milch animals unit): Rs 20,000/-

Heifer calf rearing- upto 20 calves - Rs 4.80 lakh

Purchase of milking machines/ milk testers/ bulk milk coolers (upto 2000
liter capacity)- Rs.18 lakh

Indigenous milk products manufacturing units- upto Rs.12 lakh

Dairy product transport facilities and cold chain - Rs. 24 lakh

Cold storage for milk/ milk products: Rs. 30 lakh

Private veterinary clinic: Rs.2.4 lakh - Mobile Units, Rs.1.80 lakh -
Stationary Units

Dairy parlour: Rs 56,000/-

Eligibility to get loan 

Any Farmers, individual entrepreneurs, NGOs, companies, groups of

unorganized and organized sector etc. 

Scheme funding/ Pattern of Investment

Entrepreneur’s Contribution:10% of total outlay- minimum

Back ended capital subsidy:25% (33.33% for SC/ST beneficiaries) of total

outlay, subject to a ceiling

Cold storage for milk/milk products: Rs.30 lakh.

Bank’s share: Balance portion- Minimum 40%.

Implementing Institutions: Department of Animal Husbandry Dairying and

Fisheries, Government of India is the focal department for the scheme.
NABARD is implementing this scheme through Commercial Banks, State
Cooperative Banks, SLDBs Regional Rural Banks and other agencies eligible
for refinance from NABARD.
 PROJECT COST & MEANS OF FINANCE
(Rs in lacs)
Particulars Amount Particulars Amount
Land Own Capital 29.80
Sheds construction 25.00 Term Loan 89.4
Animals & other 70.90
expenses
Recurring Expenses 23.30
Total 119.2 Total 119.2

DETAILS OF INDIVIDUAL HEADS OF PROJECT COST

Land : The promoter is proposing to start the Farm in his own land and for the dairy
and to cultivate the green grass on them at East Godavari (Dist). The location is
sufficient for proposed and future requirement unit and is very ideal for the farm.
Shed Construction :

On the above said land, the firm will construct buildings including sanitation and
water supply. The estimated civil works worth of Rs. 10.00 lacs.

1 Shed for buffaloes @ 40 Sq. ft. per animals @250 Rs. per Sq. 10,00,000
Ft
2 Fencing 2,00,000.00
3 Storage Tanks 5,00,000.00
4 Sump / Sewer 5,00,000.00
5 Electrification 3,00,000.00
Total 25,00,000.00
 Cost of Animals and Equipments

1 Cost of 100 graded buffaloes @ 60,000 lactation age 60,00,000

yielding 10 liter/day including transportation
2 Insurance @4% per animal. 240000
3 Milking Machine.5 No’s 4,00,000
4 Chaff Cutter machine 5 No’s 50,000
5 Milk Cans 4,00,000
TOTAL 70,90,000.00

Recurring capital for 3 months

Labour charges 1,00,000

Cost of concentrate Feed 7,00,000
Cost of green fodder 5,00,000
Cost dry fodder 3,50,000
Veterinary Aid 6,00,000
Eleectrical charges 40,000
Mise Expenses 40,000
23,30,000
 DETAILS OF INDIVIDUAL HEADS OF MEANS OF FINANCE

Share Capital :

The capital of the promoter is Rs. 29.80 lakhs. The promoter contribution works
out 25% of the project cost.

Term Loan :

The farm desires to avail term loan of Rs. 89.40 lakhs, to meet part cost of the
project of Rs. 119.20 lakhs which works out 75.00% of the project. The term loan will
be paid in 28 quarterly installations with holiday of six months.
 UTILITES AND SERVICES

Water :

The total water requirement of the unit is 1.2 KLD per day for watering/refilling
of husks sanitation and domestic for which required bore-well and water supply is also
provided in the project.

Power :

The total power requirement by the unit is 15 HP which comes under L.T.
Connection.

TRANSPORTATION :

The location is well connected by Road. So there is no problem for transport the
raw materials as well as well as Milk.

MAN-POWER:

The Firm will employ 30 both skilled and unskilled workers. All the persons will
requite locally.
TECHNICAL FEASIBILITY FOR 10-GRADED MILCH ANIMAL PROJECT

Dairy farming is on of the most important source of income for urban, semi-
urban and rural areas. This is because of very high demand for milk and milk
products. The composition of milk is as follows.

Species Fat % Protein % Lactose % Ash % Total Solids

%
cow 5.5 3.9 4.9 0.70 15.0

The total milk production in the country for the year 2011-12 was estimated at 165.2
million metric tones. At this production, the per capital availability was to be 452
grams per day against the minimum requirement of 250 grams per day as
recommended by ICMR. Thus, there is a tremendous scope/potential for increasing
the milk production. The population of breeding buffaloes and buffaloes in milk over 3
years of age was 125.2 million and 84.8 million, respectively (199 census The per
capita availability of milk at present is 432 gms/day as against the minimum
requirement of 500 gms/day as recommended by Indian council of medical research.

A recent survey conducted by Visakha Dairy and Dolphin Dairy has revealed
that there is demand for fifteen lack liters per day in East Godavari city alone,
whereas the availability of milk is only 18 lac liters.. Further, the demand is increasing
day -by-day on account of large-scale urbanization and increasing population.

The land is situated 30 km from East Godavari and 75 kms from

Vizianagaram ,.. So there is no problem for marketing of milk.

1. Land :
Land is available for construction of shed and also for grazing of animals. Land
is well connected to road
2. Electricity:
Electricity connection is available on the site of farm.

3. Water Facility:
Water is available in ample amount for routine work and for irrigation of land.

4. Labour:
Labour is available on chief rate through out the year itself in the village.

5. Construction of Shed:
For Construction of shed high and well-drained land is available. The site is
away from wother logging area and also nearer to road.

6. House Keeping Management:

For housing of animal tail to tail system is used. The shed constructed like this
manner-The wall
 of shed should be 5 feet high. The roof should be 10-12 feet high. A floor area
of 25 sq.ft per calf and 60 sq.ft per cow is provided 2 feet broad drain at the
rare of standing. The floor is pucca and non slippery by using grits. The
asbestos roof should be used.

7. Breed of animals:
A. Cow-Graded with 10 liter milk/day

Very good animal with a minimum Potentiality of 10 liters per day (for
Buffaloes)) and which are in second lactation be purchased under expert
guidance of Veterinary Doctor and Bank Officer.

.
 Feeding Management:
Feed can be grown on farm itself with a acre irrigated land.

The following feed will be used -

a) Dry fodder: Chaffed Jower dry fodder (Kutti)
b) Green Fodder; the green grown on own land. The following crops
grown
Hybrid Napier-N B2
Luceme-Selection No.9
S.S.C. 9 Multi Cut jowar
African Maize
SOO_Subabul trees on the bunds and other uncultivable land.
c) Concentrate Mixture: Proposed Dairy Provide concentrate mixtures. 5kg.
Concentrates like crucial grains, De Oiled Cakes, Beans, Ground Nut Cake, Cotton
Cake prepared. The concentrates mixture thoroughly in Kutti and given to animal
with a gap of 3-4 hours daily.

 Breeding of Animal:
The Productive efficiency of next generation depends on breeding practices so
careful breeding practices being used by Artificial insemination Method. Dairy
animal came to heat at an interval of 17 to 24 days with an avg. of 21 days.
The duration of estrous ranges between knows about the heat symptoms and
they daily inspect animal at early mornings and late evening hours. Veterinary
facility available for A.I. Accurate Records of maintenance of health variations,
date of service and pregnancy conformation made by qualified Veterinary
Doctor.

10. In Alamanda primary Veterinary aid clinic is functioning, the unit visited
by veterinary in case of emergency cases like Dystokia, Retention of Placenta,
Anoestrous, repeat breeding cases, for A.I the borrower know the importance
of vaccination. All vaccination programmed, deforming made by borrower
know the importance of vaccination. All vaccination programmed, de worming
made by borrower under suggestions of the experts. The main objective is to
maintain wet, ration of 75:25

11. Health Care:

The proposed dairy unit is having telephone facility for immediately reporting to
veterinarian in case of emergency. All the routine medicine like Skin
ointments, Tincture of Iodine, turpentine oil, cotton, Antibiotic, Allergy drugs
kept at the farm. All vaccination pro gramme for Foot and mouth Disease,
 Black quarter, Hemorregic Septisemial etc. Undertaken regularly and skin test
for T.B. And Brucellosis must be undertaken under expert guidance of
veterinary doctor.

12. General Management Practices:

The animal and cattle shed thoroughly cleaned every day morning and evening,
with disinfectants. The manure disposal will be kept away from shed. Proper
feeding daily 3 times and before milking animal washed with water and also
used potassium per magnate for cleaning under. Hand Milking is done.

 Milking:
Machine milking system used. Milking is done, twice daily i.e. Morning evening.

14. Marketing of Milk:

Rebaka Village situated 30 Km from East Godavari , 75 kms from Vizianagaram.
So there is no problem for marketing of milk.

15. Identification of Animal:

For Identification of animal ear tagging method used.

16. Insurance:
All animal insurance is done @ 4% cost of animal. It may change from time to
time.

17. General:
5 acres of irrigated land is available with promoters for raising fodder grass and
fodder trees. The entrepreneurs are having family history of rearing of
dairy animals since generations. Facility like water, electricity and transport
are available at the proposed farm site.
The entrepreneur also gained experience in marketing dairy and dairy products.
Project at Glance

1 Unit Size 100 Animals

2 Breed 100
3 Name of Borrower
4 Location of Farm Dairy Farm
5 Margin Money (Rs) 29,80,000.00
6 Bank Loan (Rs) 89,40,000.00
7 Interest rate (%) 12.5%
8 Repayment period 7 years including 6 month gestation
period
9 Inspection Once in a month by the Branch
10 BCR at 15% DF 2.10
11 IRR (%) >50%

Feed and Fodder Requirements of animals per day

Green Fodder Dry Fodder Concentrates

Lactating buffaloes 12 Kg 1.6 Kg 1.6 Kg
Dry buffaloes 8 Kg 2.4 Kg 0.8 Kg

Particulars Rate Rs. / KG Milking CBC Dry

Buffaloes
Kg Kg
Cost Cost
Green Fodder
Dry Fodder 3.00 08 12
12 18
Concentrates 12.00 08 04
48 24
Total Rs./day 6
0 42
Expenditure Cost
Total Expenditure I II III IV V VI
Cost of feeding dry 0.808 1.03 0.808 0.99 0.99 0.99
fodder during
lactating days
Cost of Feeding dry 0.104 0.28 0.28 0.28 0.28 0.28
fodder during dry
period
Cost of feeding 0.136 0.18 0.14 0.164 0.164 0.164
concentrates during
lactating days
Cost of feeding 0.4 0.4 0.4 0.4 0.4 0.4
concentrates during
dry period
Veterinary aid 0.12 0.12 0.12 0.12 0.12 0.12
&breeding cover @
Rs. 300/animal
Cost of Labour 6 0.72 0.72 0.72 0.72 0.72 0.72
labour/day @
Rs.100/day
Cost of electricity 0.048 0.048 0.048 0.048 0.048 0.048
&water
Miscellaneous 0.24 0.24 0.24 0.24 0.24 0.24

Total Expenditure 2.576 3.018 2.756 2.962 2.962 2.962

 milk sold at a price of Rs.18.00/liter ( Yield 10 liter/day)

Sr.No Particulars Years

I II III IV V VI
a) Location Days
b) 10 buffaloes 2700 3450 2760 3300 3300 3300

Income Statement for 10 animals

(Value in lacs.)

Particulars I II III IV V VI
Milk 5.664 5.664 5.664 5.664 5.664 5.664
Sale of Gunny bag@ Rs. 0.04 0.04 0.04 0.04 0.04 0.04
6/bag
Sale of manure @ Rs.500/ 0.06 0.06 0.06 0.06 0.06 0.06
animal
Total Income 5.764 5.764 5.764 5.764 5.764 5.764
NOTE: The calves and heifers were not included in the income
Gross Profit

Total 5.764 5.764 5.764 5.764 5.764 5.764

Income
Total 2.576 3.018 2.756 2.962 2.962 2.962
Expenditur
e
Gross Profit 3.188 2.746 3.008 3.802 3.802 3.802

Net Profit

Gross profit 3.188 2.746 3.008 3.802 3.802 3.802

Bank
interest 0.93 0.96 0.81 0.65 0.49 0.33
Insurance 0.40 0.40 0.40 0.40 0.40 0.40
Adm 0.24 0.24 0.24 0.24 0.24 0.24
Expenses
Depreciatio
n 2.27 1.78 1.40 1.11 0.89 0.72
Net Profit 1.62 1.15 1.56 2.51 2.67 2.83
The following technical aspects to be taken care of-
All concerned to the following aspects must pay special Attention for:
Shed must be constructed on a high and well-drained land.
A separate shed for, buffaloes and calf must be constructed.
A suitable arrangement should be made with the Veterinary Doctor consultants to ensure
health of animals and in case of emergency.
It is proposed that buffaloes yielding 10 liters and liters of milk every day should buy from
market having good pedigree record or buy animals after 2-3 days after calving yielding that
much of milk.
The purchased animals should be in 2nd or 3rd lactation.
Bank may consider sanctioning of additional working capital to the unit in the event of the
unit running successfully and want to increase the number of animals for more milk
production.

RECOMMENDATIONS

 The scheme as described above is considered to be technically feasible and

economically viable.
 Hence, it is recommended for sanction of the scheme on the lines of the lending and
other norms as suggested in the scheme and as per bank's other usual systems and
procedures.

The applicant is credit worthy and trust worthy is having experience in this field . The
applicant is offering collateral security and residential building market value will be
around Rs 0.00 lacs per acr,

Keeping in view of the above, technical and finance perimeters, tie past dealing of the co
obligant and the value of the security offer, we recomend for sanction of term loan of Rs
89.40 lacs, repayable in 22 quaterly instilments with six months
 TECHNO ECONOMIC PARAMETERS

ii) Cost of milch animals buffaloes @ Rs.60,000

Iii) Lactation period (days) buffaloes -270 days

iv) Dry period (days) buffaloes -90 days

v) Milk yield (its./day) buffaloes -10 lit/day

vi) Sale price of milk (Rs./Lt) buffaloes Rs. 40.00/lit

vii) Sale of manure/animal/year (Rs.) 500

viii) Insurance premium for five years 5%
(%)
ix) Veterinary aid/animal/year (Rs.) 1000
x) Labour (Rs) 6 labour per day @100/day
xi) Cost of electricity &water 1000/month
(Rs./animal)
xii) Interest rate (%) 12.50
xiii) Repayment period (years) 6 years including 6 month
gestation period
xiv) Income from sale of gunny bags
10 bags/tonne @ gunny bag 100
xv) Feeding schedule

Sr.No. Type of fodder/feed Price (Rs./kg) (Quantity in kg/day)

Lactation Period/ Dry

Period
a) Green fodder Cultivated on own land
b) Dry fodder 4.00 4kg x 1.00=04
6kgx1.00=06
c) Concentrate 12.00 4kgx5.00=20 2kg
x5.00=10
Total Rs.24.00