Hariyali Kisaan Bazaar (HKB), the rural retail arm of DCM Shriram Consolidated Ltd (DSCL), has entered the milk procurement business in Uttar Pradesh and is looking to expand to Rajasthan next month. The milk is being supplied to dairy units and is being mainly used to produce milk powder.
The programme has been initiated under HKB’s farm output services. The company has started a pilot dairy operation in Hardoi and Lakhimpur Kheri districts of central UP, where it has four sugar mills. The company has also made arrangements with regional rural banks to facilitate farmers in getting finance for cattle purchase.
The model envisages the setting up of an efficient milk supply chain between the farmer and the dairy industry. “Hariyali has been working with an objective to increase the productivity and profitability of the farmers. So far, we had been focusing more on our agronomy services to help farmers but now have identified milk procurement as an area to enhance farmers’ income, since both small and big farmers have cattle. We collect around 3,500 litres of milk per day in UP and by December we hope to collect 5,000 litres,” said Vikram Shriram, vice chairman and managing director, DSCL. The company makes a rupee on every litre.
Following the successful launch in UP, the company plans to expand the procurement business to other states. It has set up operations in 70 villages of Rajasthan around the districts of Alwar and Hanumangarh. It aims to collect around 10,000 litres per day in December and about 25,000 litres in January.
“The initial response from farmers has been very positive because of timely payment and transparent practices. We are hopeful of extending the procurement business to all the states where Hariyali operates,” he said. HKB is the country’s largest rural retail chain, with 302 stores across the states of UP, Punjab, Haryana, MP, Rajasthan, Maharashtra, Chhattisgarh and Andhra Pradesh.
Along with the physical infrastructure, farmers are provided with veterinary services. Farmer meetings are being held regularly for training in good animal husbandry practices. Quality cattle feed is also being provided and this has resulted in productivity improvement, he said. Since this area is traditionally not a large commercial producer of milk, extension activities will be done on an ongoing basis to build awareness and improve productivity, he added.
