It is yet to conduct market survey to assess demand for products
At a time when cooperative milk societies and unions are facing tough competition from the private sector, the Belgaum District Milk Producers' Societies Union has not even carried out a market survey to assess the demand for its milk and other products sold under the brand name ‘Nandini'.
C. Channakrishnaiah, managing director of the union, who has claimed there is additional requirement for Nandini milk, has no figures to show the demand-supply gap.
Market share
However, he said the market share of Nandini milk in the district was about 25 per cent.
The rest of the requirement was met by private establishments, including ones from Maharashtra.
He did not have a convincing reply as to why, despite selling milk at a much higher price, the union had not been making any notable profit.
Talking to presspersons here on Tuesday, he said the union was procuring 97,500 litres of milk every day, of which 79,000 litres was sold. Of this, more than 45,000 litres was sold in Goa and the rest in Belgaum district. It was also selling 1,500 litres of curd every day, a large portion of it in Goa.
Costs
The union sold full-cream milk at Rs. 36 a litre in Goa, which was Rs. 8 more than in Belgaum.
Similarly, standardised milk was sold for Rs. 34 a litre in Goa, whereas it was only Rs. 26 in Belgaum.
Yet, the union's profit margin was on a par with the margin earned in Belgaum.
This was due to transportation and maintenance costs, and higher commission levels in Goa, according to Mr. Channakrishnaiah.
He said that unlike private milk suppliers, the union worked as a social enterprise to help farmers improve their economic condition, sometimes even at negative profits. Yet, the union had marked a growth of 10 to 12 per cent in milk procurement and 7 to 8 per cent in sales during the current financial year.
In 2010-11, the net profit amounted to Rs. 26.97 lakh. The union has already made a profit of Rs. 53.64 lakh by September-end this year, he added.
He said the reason for the low profits was the high procurement prices given to farmers — Rs. 25.35 for a litre of buffalo milk and Rs. 16.85 for a litre of cow's milk apart from the Rs. 2 per litre subsidy provided by the Government.
Also, though there was good demand for Nandini milk in the district, the union was finding it difficult to reach out to consumers due to the presence of dealers who promoted other milk brands to get higher commissions.
He said the union had, therefore, planned to boost its market by opening more dealer outlets and outlets for direct sale.
It will also carry out door-to-door campaign to popularise Nandini.
Cooperative Week
Union chairman B.B. Galagali and member Sanjaygouda R. Patil said the union will celebrate its 58th Cooperative Week at Dharmanath Bhavan in the city on November 16.
They said the union had planned expansion programmes for which the State Government had granted Rs. 275 lakh.
