In a bid to expand procurement base among dairy farmers, state owned-Odisha State Cooperative Milk Producers Federation (OMFED) has decided to double its milk processing capacity in the next three to four years.
The move comes after many farmers spilled milk on road a few months back in protest against the state federation’s refusal to accept all the milk brought by the farmers to the collection centres of OMFED.
An OMFED official told FE that it had to scale down investments in milk processing capacities due to net losses from operations. This has resulted in one of the biggest milk federation in eastern India, affiliated to National Dairy Development Board (NDDB), reporting a huge loss of Rs 24 crore in FY16 against a profit of Rs 2.2 crore in 2014-15.
Recently, Nabard had sanctioned Rs 245 crore under the Rural Infrastructure Development Fund (RIDF) to the state government for augmenting milk processing capacity of OMFED by five lakh kg daily. Currently the state federation processes similar volume of milk daily in four plants — Bhubaneswar, Bargarh, Sambalpur and Rourkela.
Following Nabard’s soft loan, OMFED will set up the new processing plants in Cuttack district in the next couple of years. Besides, consultancy firm MPCON has agreed to set up a one lakh litres daily milk processing capacity for OMFED in the next two years. “By 2020, we should be able to handle more than 10 lakh kg of milk daily,” Madhusudan Padhi, managing director, OMFED, said.
Earlier, for increasing milk processing capacity of OMFED a detailed project report was prepared by IDMC, a subsidiary of NDDB. The project will be completed within a period of two to three years. Milk, curd, ghee, indigenous milk products, flavoured milk, paneer, and milk powder will be produced in the plant proposed at Choudwar in Cuttack district.
During 2011-12 to 2015-16, the daily procurement of milk by OMFED has increased by 42% to 5.2 lakh kg from 3.7 lakh kg. OMFED at present has the capacity to process around 5 lakh kg of milk daily. “Without increasing processing capacities we can not increase procurement of milk,” Padhi said.
According to OMFED officials, the federation collects 5.2 kg of milk a day from dairy farmers through 3,762 village cooperative societies. Around 80% of the OMFED’s income from selling milk is disbursed among the 2.8 lakh dairy farmers in the state. The federation has a target to collect an average of 5.9 lakh kg of milk daily from farmers during the current year against 5.26 lakh kg collected per day during the last fiscal.