Market Reports

Dairy Industry in India

1	Indian Dairy Sector: Quick Facts
2	Dairy Sector: Value Chain
3	Milk Production Overview of India
4	Overview: Dairy Sector in India
5	India’s Dairy Industry flows
6	Government & Milk Producer Initiatives

Indian Dairy Sector: Quick Facts

India is the world's largest milk producer

24% contribution to global milk production

India’s milk processing capacity is 126 million liters per day

For a decade, country’s milk industry has been growing at a CAGR of 5.8%

Milk production in India registered more than 50% increase during the last ten years

Globally, India exported 67,572 million tons of dairy products during the year 2022-2023

80 million people are employed in the dairy sector

The industry contributes 5% to the national economy

Per capita availability of milk is 459 grams per day

In 2022-2023, India's Butter, Ghee, and Dairy Spreads export stood at 8,106 MT

Major export destinations for milk products are Saudi Arabia, UAE, Malaysia, and Bangladesh

Milk production from buffaloes increased by 3.7% in 2023 as compared to the previous year

Top 5 milk producing states together contribute around 53% of total milk production in the country

India exported 9,262 MT of Cheese to the world. Major destinations are UAE, USA, Bhutan, Singapore, and Saudi Arab during the year 2022-2023

Dairy Sector: Value Chain

Inputs

Milch Animals
Cattle Feed
Dairy Feed
Fodder
Milking Technology

Aggregation

Collection Agents
Chillers
Firms
Milk Traders
Other Traders

Primary & Secondary Processing

Pasteurization
Packaging
Value added products
- Toned Milk
- Standard Milk

Distribution

Private Dairy
Dairy Cooperatives
Firms

Retailing & Export

E-commerce
Convenience Stores
Supermarkets
Department Stores
Export Houses

Milk Production Overview of India (in ‘000 tons)

States	2018-19	2022-23	Growth % (2018-19 Vs 2022-23)
Uttar Pradesh	30,519	36,242	18.8%
Rajasthan	23,668	33,307	40.7%
Madhya Pradesh	15,911	20,122	26.5%
Gujarat	14,493	17,281	19.2%
Andhra Pradesh	15,044	15,448	2.7%
Maharashtra	11,655	15,042	29.1%
Punjab	12,599	14,301	13.5%
Karnataka	7,901	12,829	62.4%
Bihar	9,818	12,503	27.3%
Haryana	10,726	11,966	11.6%
Tamil Nadu	8,362	10,317	23.4%
West Bengal	5,607	6,969	24.3%
Telangana	5,416	5,855	8.1%
Others	16,030	18,395	14.8%
Total Production	1,87,749	2,30,577	22.8%

Overview: Dairy Sector in India

Top 5 milk producing States are Uttar Pradesh, Rajasthan, Madhya Pradesh, Gujarat, and Andhra Pradesh. They together contribute around 53% of total milk production in the country.
The average yield per animal per day for exotic/crossbred is 8.55 Kg/day/Animal and for indigenous/non-descript is 3.44 Kg/day/Animal.
Milk production from exotic/crossbred cattle has increased by 3.75% and indigenous/ non-descript cattle has increased by 2.63% as compared to the previous year.
Top 13 states together contribute around 92% of total milk production in the country
India produced close to 50% more milk than the US and more than three times as much as China.

Overview of Dairy Sector in India

Top 5 milk producing States are Uttar Pradesh, Rajasthan, Madhya Pradesh, Gujarat, and Andhra Pradesh. They together contribute around 53% of total milk production in the country.
The average yield per animal per day for exotic/crossbred is 8.55 Kg/day/Animal and for indigenous/non-descript is 3.44 Kg/day/Animal.
Milk production from exotic/crossbred cattle has increased by 3.75% and indigenous/ non-descript cattle has increased by 2.63% as compared to the previous year.
Top 13 states together contribute around 92% of total milk production in the country
India produced close to 50% more milk than the US and more than three times as much as China.

Growth Drivers:

Shifting Dietary Preferences
Government Initiatives/Schemes
Increasing Health Consciousness
Rising Foreign Direct Investment (FDI)
Cold Chain Infrastructure Development
Technological Advancement in Milk Processing

Key Facts:

The Indian Government has set the goal to double India’s processing capacity up to 108 MMT by 2025. The Government also aims to increase India’s export share in the world from 0.36% to 10% by the end of 2025
Out of total dairy production, 65% of the milk is sold in liquid form
The value-added products such as ghee (clarified butter) and yogurt account for 8% of the dairy sector each
Baby food (milk-based) accounts for 5% of the dairy sector
Market for ice cream accounts for 4% of the dairy market
Butter, cream, cheese (including paneer), and dairy whitener collectively account for 10% of the Indian dairy sector

Market Share 2022 - 2023

India’s Dairy Industry Flow

The Indian dairy sector is divided into the organized and unorganized segments:
- Unorganized segment consists of traditional milkmen, vendors, and self-consumption at home
- Organized segment consists of cooperatives and private dairies
Indian dairy sector is dominated by an unorganized sector, selling 64% of the marketable surplus
Around 36% of the marketable milk is processed by the organized sector, with cooperatives & Government dairies, and private players contributing 50% each
Amul, the brand of Gujarat Coop Milk Marketing Federation (GCMMF) is the largest dairy co-operative and the largest organized player in India
It is the 9th largest dairy player in the world. It aims to be amongst the top 3 dairy players in the world. Amul plans to add 40-60 value-added products in the next 2 years.

Government & Milk Producers Initiatives

Government of India set up a 15,000 Cr fund for offering financial support to set up new units or expand existing units in areas of dairy processing & related value addition infrastructure, meat processing & related value addition infrastructure, and Animal Feed Plant. The benefits available are:

3% interest subvention on loans
2-year moratorium with 6-year repayment period
INR 750 Cr credit guarantee

The Rashtriya Gokul Mission has been extended till 2026 with INR 2,400 Cr commitment to boost productivity and milk output, making dairying more profitable for farmers.

50% Capital subsidy up to INR 2 Cr to eligible entrepreneurs, individuals, FPOs / FCOs, SHGs, JLGs, and Section 8 companies for the establishment of breed multiplication farms
Accelerated breed improvement program under the component subsidy of INR 5,000 for IVF pregnancy

National Program for Dairy Development (NPDD) scheme aims to enhance the quality of milk and milk products and increase the share of organized milk procurement, processing, value addition, and marketing. The scheme has two components:

Component ‘A’ focuses on creating/strengthening infrastructure for quality milk testing equipment as well as primary chilling facilities for State Cooperative Dairy Federations/ District Cooperative Milk Producers’ Union/SHG-run private dairy/Milk Producer Companies/Farmer Producer Organizations. The scheme will be implemented across the country for the period of five years from 2021-22 to 2025-26.
Component ‘B’ (Dairying Through Cooperatives) provides financial assistance from the Japan International Cooperation Agency (JICA) as per the project agreement already signed with them. It is an externally aided project, envisaged to be implemented during the period from 2021-22 to 2025-26 on a pilot basis in Uttar Pradesh and Bihar

In September 2023, AMUL had opened its 85^th branch in Kutch, Gujarat. This new branch ensures the distribution of the entire range of Amul’s dairy products

In March 2024, Mother Dairy announced that it will invest INR 650 crore to set up two new plants for the processing of milk. The company will also invest INR 100 crore to expand the capacities

In December 2023, Karnataka Milk Federation (KMF) announced that the Company will start buffalo milk sales from December 21 in the country