PROJECT REPORT ON

DAIRY FARMING (COW)

SUBMITTED BY:
Sanjay Gautam, Village Newada, Tehsil Ramgarh
District Alwar, Rajasthan

2016-17

Project Report on Dairy Farming by Lokeshwar Mathur & Co.

HIGHLIGHTS OF THE PROJECT REPORT

ABOUT THE PROMOTER

PARTICULARS
1.

P r o m o t e r Name

Sanjay Gautam

2.

Address

Village Newada, Tehsil Ramgarh, District Alwar, Rajasthan

3.

Contact

Number

9810543911

4.

Project

Location

Village Newada, Tehsil Ramgarh, District Alwar, Rajasthan

5.

Constitution

Individual Farmer

6.

Product

M i l k , Ghee, Urine, Cow Dung Cake, etc.

7. Breed
8. Unit Size

Pure Indian Breeds like Sahiwal, Rathi, Tharparkar

10 Cows

Page 2 of 15

Project Report on Dairy Farming by Lokeshwar Mathur & Co.

Page 3 of 15

PROJECT DESCRIPTION
Animal husbandry and agriculture are synergistically involved and are the important source of income and
employment in rural areas. Among them, dairying provides security to farmers, especially when agriculture fails. Dairy
farming is essential to millions of poor households across the country not only as a source of income but also as a
major source of protein, supplementary nutrition, fertilizer, fuel and a store of wealth.
Enhancement in milk processing has necessitated the increased demand for milk and this triggered the setting up of
many commercial dairy units in medium and small scale in different parts of the country. Introduction of improved
technologies, availability of compounded feed are the other factors responsible for this shift from traditional mixed
farming production to specialized dairy production system. Dairying with high yielding breeds has generated ample
scope for developing the dairy farming on commercial lines as a business enterprise.
Production Technology
Project Location:
Dairy farm is located in the area where assured market of milk round the year is available. It is easily accessible to the
main road and is very well connected to cities like New Delhi, Gurgaon, Jaipur, Alwar, etc.
Electricity:
Adequate supply of electricity is available.

MARKET POTENTIAL
Milk and milk products are widely and extensively used items in Indian cuisine throughout country. India has the
privilege to be the largest producer of liquid milk but still there is a huge gap in demand and supply.
The country production of milk is one hundred and twelve million ton and there is increase of production of milk in the
country at the rate of 3.5 million ton per year but it is not enough to meet the demand in the country of milk which is
increasing at the rate of six million ton per year. So this is massive gap of demand and supply of milk.
With milk product exports forming around 5 per cent of India's total milk production, and domestic demand for dairy
products remaining strong, there is the demand-supply gap. The demand for milk and value-added dairy products in
the domestic market has been growing at over 6 to 8 per cent per annum because of increasing income, rising
aspirations, and consequent growth in per capita milk consumption.
The demand for milk more than doubled on the religious occasion like Maha Shivratri. Apart from 'abhishek' rituals,
milk is also required for the preparation of thandai which is consumed as prasad by the devotees. A number of
vendors, thandai shop owners and sweet makers purchase milk in bulk one day in advance. There is good demand
of milk during peak wedding season also.
Milk and Ghee can be sold to milk cooperative societies as well as entrepreneur can develop his network of
consumers. Milk can be sold in the immediate market directly to customers, hotels, hospitals, sweet makers etc.
Hotels and some general customers (can be around 30%) prefer pure Cow milk. Hospitals, sanitariums also prefer
cows milk. One can reach long term purchase agreement with either district milk union or with private milk marketing
company.

CHAPTER - IV
SWOT ANALYSIS
Strengths:
Cow is Indias prime milking animal, accounting for more than half of the countrys milk production.
Urbanisation, burgeoning population, raise in per capita income and change in food habits which leads to increased
consumption of milk.
Whitening property of Cow milk makes it more suitable for manufacture of some dairy products and its acceptance
as fluid milk is high.
Provide regular income to the farmer.
Provide employment to rural population mainly women.
Dairy farming helps directly in increasing crop production by making available draught power, manure and cash
income on day- today basis.
Additional income improves the quality of life in rural areas.
Favorable Government policies for development of livestock sector.
Opportunities:
Cost of milk production in India is low.
Scope exists for higher milk yield through better use of crop residues and other feeds Upgrading cattle.
Improving availability of animal health care facilities. Improving availability of animal health care facilities.
Better returns because of increased awareness in consumers about quality.
Good scope exists for value-added products like desserts, puddings, custards, sauces, mousse, stirred yogurt,
nectars and sherbets.
Latest packaging technology can help retain nutritive value of packaged products and extend their shelf-life.
Weakness
Feed availability to cattle throughout the year is not adequate.
Frequent disease outbreaks.
Lower productivity of Animals.
Labour shortage and high wage rate in dairy farming.
Limited investment or delay in the availability of funds in setting up or expansion of milk procurement.
Poor infrastructure in many areas for transporting rurally-produced milk to major processing centers.
Threats
Natural calamities like floods, drought, diseases that can affect feed to cattle/cattle population.
Seasonal fluctuations in milk production.
Dwindling fodder resources.

ECONOMICS OF THE PROJECT

BASICS AND PRESUMPTIONS

PARTICULARS

QUANTITY

Techno-economic parameters

No. of Animals
No. of animals/batch
Cost of Animal (Rs./animal)
Average Milk Yield (litre/day)
Floor space (sqft) per adult animal
Floor space (sqft) per calf
Cost of construction per sqft (Rs.)
Cost of equipments, chaff cutter (Rs.)
Insurance premium (% per annum)
Veterinary aid/animal/ year (Rs.)
Cost of concentrate feed (Rs./kg)
Cost of dry fodder (Rs./kg)
Cost of green fodder (Rs./kg)
Salary of labour per month (Rs.)
Cost of electricity and water/animal/year (Rs.)
Margin (%)
Rate of interest (%)
Repayment period (years)
Selling price of milk/litre (Rs./litre)
Sale price of gunny bags (Rs.per bag)

10
5
50000
10
50
20
120
70000
5
1000
12
2
1
4500
150
25
12
5
26
10

CAPITAL COST:
Capital Cost (Cost of 10 Cows, including transportation)
Construction of shed
Cost of Equipments (Chaff cutter, etc.)
Total

INR 5,00,000/INR 84,000/INR 70,000/INR 6,54,000/-

FEED COST:
Type of Feed
Price (INR)
Concentrate
Green
Dry

12
1
2

Lactation
Qty (Kg)
Cost per Day
(INR)
5
60
25
25
4
8
93

Dry
Cost per Day
(INR)
24
20
10
54

Qty (Kg)
2
20
5

SALE & PROFIT:

Particulars
429000
1710
430710
153450

585000
2790
587790
209250

Years
3
585000
2790
587790
209250

8100

72900

72900

64800

64800

10000
54000
1500
25000
252050
178660

10000
54000
1500
25000
372650
215140

10000
54000
1500
25000
372650
215140

10000
54000
1500
25000
378500
209380

10000
54000
1500
25000
378500
248380

1
Sale of Milk
Sale of Bags
Total Sale
Cost of Feed
(Lactation)
Cost of Feed
(Dry)
Vet & Breeding
Labour
Electricity, etc.
Insurance
Total
Profit / Loss

4
624000
2880
626880
223200

MEANS OF FINANCE

Capital
Working Capital for Two months (Including Y1 Insurance)
Total -

PARTICULARS

UNIT

INR 6,54,000/INR 62,842/INR 7,16,842/-

UNIT RATE

585000
2880
587880
223200

AMOUNT Rs.

Term Loan

90

6,45,158/-

Own Contribution

10

71,684/-

TERM LOAN REPAYMENT

Year
1

Loan
Outstandi
ng
645158

516126.4

387094.8

258063.2

129031.6

Surplus
178660
215140
215140
209380
248380

Interest
77418.96

Principal
129031.6

61935.168

129031.6

46451.376

129031.6

30967.584

129031.6

15483.792

129031.6

Repaymen
t
206450.56
190966.76
8
175482.97
6
159999.18
4
144515.39
2

Net
Surplus
-27790.56
24173.232
39657.024
49380.816
103864.60
8

ASSUMPTIONS:
The above calculations are on the assumption that only milk is being sold.
To increase profitability, urine, cow-dunk cake, etc. will also be sold.
Also, cow-milk will be eventually be processed to make cheese, ghee, chhas, etc. for better profits.
To minimize input cost (working capital), fodder will be grown on farmers own farm and will not be bought from the
market.