 "R S Sodhi")
How important is the expansion into Punjab?
We plan to procure 200,000 litres a day from dairy farmers there. The milk will be screened, chilled in bulk coolers and transported to our processing plant at Batala in the state. While our daily procurement will be lower than the cooperative network of Verka (brand name of The Punjab State Cooperative Milk Producers’ Federation; it procures 1.1-1.2 million litres a day), I see our expansion into the state as a significant step. Farmers will have choice on the cooperative they wish to associate with. This will mean better prices for them. We benefit and the cooperative movement as a whole is also strengthened.
What is your view of ITC’s impending entry into the dairy segment?
Competition in dairy is welcome. Milk farmers will benefit with the entry of organised, large players. However, our observation is that most entities are (only) keen to harvest the product. None seem inclined to look at areas such as improving of milk productivity. That is something only the cooperatives are doing. That gives us an edge over competition.
But, with the many years ITC has been cultivating its network on the agri-commodity front, thanks to trading platforms such as e-choupal, won’t it be easy for them to replicate this model on the milk front?
It is possible. However, we have a head start in milk procurement over the others. We have 3.5 mn farmers from 17 district unions associated with us. This did not happen overnight. It took us time to convince them of our pricing, to be part of our network.
Amul had raised milk prices by three per cent in May. Is a new round (of price rises) likely, given food inflation has not moderated significantly in recent months?
I do not foresee a price rise in the near term. Milk prices are in line with inflation at the moment and we don’t intend to burden consumers with an additional hike any time soon. In the past one year, milk prices have risen by four to five per cent, which is substantial. We took a marginal hike in May. This is enough for now.
Any new products in the offing this year?
We came up with a premium ice-cream range this summer. Yes, there are more products in the pipeline. I cannot disclose anything at the moment for competitive reasons.
What will be your turnover this financial year?
We expect to close 2014-15 with a turnover of Rs 22,000 crore, growth of 20-21 per cent over last year (FY14 turnover is Rs 18,143 crore). While our sales growth in 2013-14 was 32 per cent, when you take an average over the past five years, it works out to around 23 per cent (annually). So, we should be close to our average growth rate when we close the current financial year.
Tomorrow (26 November) is the birth anniversary of Verghese Kurien. How will GCMMF be celebrating it?
From this year onwards, 26 November will be celebrated as National Milk Day. The proposal to do so came from the National Dairy Development Board and the Indian Dairy Association about a month ago. We began promoting the event about a week ago on our milk packets.We distribute 2 crore (or 20 million) packets a day, which is not a small number. We will also run television commercials and print ads tomorrow to commemorate the occasion. At the same time, we will also organise rallies for farmers (in Gujarat) tomorrow and attempt to highlight the work of Dr Kurien. DVDs of the 1976 movie Manthan that GCMMF produced has been made available on Amazon.com by us. And the pre-orders so far have been good. So yes, we are using all levers to promote the occasion.
