PRESENTED BY:STUTI RUCHA (28045)

VINEY RAO (28051)

PRM-28INSTITUTE OF RURAL MANAGEMENT ANAND

Impact of High domestic and International buffalo meat

prices on the milk production in North India

Objectives/ Research Questions

To study the whole buffalo meat industryTo find out whether there a significant impact

of the increase in buffalo meat prices on the milk production in North India

If, yes its extentTo find out the future prospects of relative

economics of milk and meat industryTo identify the measures which could be

taken to reduce the shift of lactating animals towards slaughter

Methodology

Desk researchSnowball SamplingVisits to Slaughter houses, abattoirs, cold

storages, transporters, traders etc. for understanding the supply chain

Visits to the Livestock Markets (Mandis) Farmers’, slaughterers’ and intermediaries’

surveysVisits to the APEDA, Municipal corporation

and other district administration offices for collection of secondary data

Buffalo meat Industry (Cara beef)

Indian buffalo meat exports: 483000 MT (Rs.3500 crores)

95% of the total meat exported53% (90-93 million) of the world buffalo population55% of the milk production by buffaloesAround 11-15% slaughter rate, states variation (10-

23%)Consumer perception:

Low cholesterol, leanest among red meat White fat as carotene No differentiation in he and she buffalo meat Preference towards Veal

US & UK are biggest markets (Indian meat exports very limited) (Source: APEDA and FAO)

Rise of the Indian buffalo meat industry

Four bovine meat producing clusters: NA, SA, OC & EU EU:

Mad cow & BSE in 90’s Reduced agri subsidies Increasing prices & strengthening Euro, 1993 (83200 MT net export), 2003 (73000 MT net import)

Present Meat deficit regions: Central America, Caribbean, Russia and CIS, Africa, Middle East, and East Asia

FMD control programme in India (2003) Indian Meat: Nearly organic

Competitive price No Mad Cow Disease or Bovine Spongiform

Encephalopathy (BSE) Good proximity to ASEAN and Middle eastern countries Presence of integrated meat processing facilities

(Source: Agricultural summit 2005)

Thrust to meat industry

NMPPBInclusion of meat in VKGUYRestoration of DEPB rates11th Five year plan Meat & poultry: 10%,

dairy : 5%APEDA’s Support

Buffalo meat exportsOn A Rise!!!

Source: Export figures from APEDA

Industry structure

Integrated abattoirs: Export orientedMeat processing Plants: Export orientedUnorganized & unauthorized slaughter

slabs: Domestic consumption15 Integrated abattoirs, 171 Partially

integrated Meat processing plants, 3900 MC slaughter houses, >12000 slaughter slabs

(Source: Report of animal husbandry, planning commision.nic.in)Export oriented units: Certification from APEDA, Ante Mortem & Post Mortem tests

Industry (Source: APEDA)

S. No

Company Processing Plant Location Capacity Annual

Capacity (tones)

1. Allanasons Fully Integrated Partially integrated

UnnaoSahibabad

90,000 50,000

2. Hind Agro Industries Ltd

Fully IntegratedPartially Integrated-Do--Do--Do-

Aligarh, U.P. Sahibabad, UPMeerut, UPKhurja, UP Lawrence Road, New Delhi

120,000 50,00025,00020,00020,000

3. Fair Exports Fully Integrated Barabanki, UP 50,000

4. MKR (Abbott)

Fully Integrated Dera Bassi, Chandigarh, Punjab

40,000

5. Punjab Meat Limited

Fully Integrated Bassi, Punjab 50,000

Fore quarters

Hind quarters

Boneless buffalo meat products

Integrated abattoirs

Live animals procuredFarmers or traders, Own Farms or MandisVeterinary facilities in some areasIdentification codes to the traders Demand requirement in advanceApril- May is lean season for supply

(harvesting season)Peak period of demand is around Id and

Christmas.Lean season of demand March to July

Procurement rates (Source: PML as on 13-11-08)

Terms & Conditions Young veal should not be below 30 kilograms otherwise it

would be rejected for slaughtering. Payment is done twice in a week (on Monday and

Thursday. Animals above the age of 8 and below the weight of 30

kilograms are not accepted for slaughtering.

Weight (in kilograms) Rate(in rupees)

225 and above 64

191-225 63

171-190 61

151-170 58

100-150 52

Contd…

Charge of transportation is 3.6 rupees per kilogram from factory (Delhi) to Port (Mumbai)

Demand in the importing countries Factory meat prices

Allana Market Leader (Factory procurement price)

The other parts of buffalo are used: Bones: Poultry feed Hides & skin: Leather industry Horns: Decorative items, Button industry etc Fat: Soap industry, biofuel (proposed) Blood: Pharmaceutical industry

Operations of Integrated Abattoirs

Animals received

Examination& Washing

Halal by Mullah

Sterilisation from CBG

Removing of Horn & Hooves

Removal of Offal and Hides

Washing & Weighing

Removal of Unwanted Fat

Making pieces of Carcasses

Deboning & Deglanding

Chilling for 24 Hours

Packaging & Freezing

Final packing (Lamination)

Storage & Shipment

Meat processing plants (Intermediaries)

Slaughtered animal from MC slaughter houses (Via traders)

Declares the procurement price (Factory price) on each day

Able to export just because of seal of municipal corporation on carcass

Deals in all major productsSome owned by groups who also have

integrated abattoirs in other locations.

Operations at the MC Slaughter house & Meat Processing units

aAnimal is ‘Halaled’

Transported to factory

Animal is cut into 4 pieces (Head, Body, Hind Limb &

Fore Limb

Skin of animal is removed

Animals Received

Washed

Chilled for 2-3 hours (0-5

degree Celsius)

Deboning

Transportation to

Mumbai

Shipment to importing countries

Packaging

Butcher gets Rs.50

Trader gets a commission of 50 Paisa/Kg.

Slaughter slabs (Retail shops)

Situated in particular localities (Proximity to Mandis’)Buffaloes are procured from Mandi directly by

retailerButchered in very unhygienic conditions Price is determined by the arrivals in the Mandi and

the factory priceMeat with bones and fat Sizes as per the customer demandGenerally a margin up to Rs.3-5/Kg is involvedBesides that, hides, skin and other valuable part of an

adult buffalo is sold at around Rs.1600

Role of Municipal Corporation

Majority of the animals are slaughtered for domestic purposes

Just provides space for slaughtering and does not act as intermediary

Provision of anti-mortem and postmortem tests but not done

Limits of number of buffalo slaughtering are fixed by some high courts

Only registered butchers allowed to operateCollects Tax (hygiene fee) from the

butchers/traders

Role of livestock Mandis

Different Mandis or productive (lactating) and unproductive (‘Fantar’) animals

Mostly held on a particular week day or on a particular dates

Festive seasonsEither controlled by the district

administration or contractorsSeller: Entry fees, Buyer: 2-4% taxBuffalo for slaughter houses in ‘Fantar

Mandis’ Price is based on weight speculation

Contd…

15% are adult males, 10% are male calves and <1% female calves (Having any problem, mother dies)

10% lactating buffaloes (economically unviable)Price of a productive lactating buffalo is

determined by Frame- 15% Dairy Character- 20% Body Capacity- 10% Feet and Legs-15% Udder- 40%

Impact on meat industry on milk production

Milk production (in 000 tonnes)

(Source: APEDA)

Contd…

Milk production (in 000 tonnes)

(Source: APEDA)

Buffalo population in India (Source: Livestock Census)

Composition of buffalo population(Livestock Census 1987,1992 and 2003: Pan India and states

figures)

Group Percentage of total population

Male (Under 1 Year) 5-8%

Male (1-3 Years) 3-4%

Male (over3 Years) 6-8%

Total Male population 15-20% (1.75 for breeding)

Female (Under 1 Year) 12-16%

Female (1-3 Years) 10-15%

Female (Over 2.5 Years) In Milk 33-38%

Female (Over 2.5 Years) Dry 13-16%

Female (Over 10 years) 4-6%

Female (Over 2.5 Years) Not yet Calved

3-5%

Female (Over 2.5 Years) Mastitis or any other infertility problem

1%

Dairying and SlaughteringAny Effects!!!

Year

Buffalo population (In Million)

Total milk production (In 000 Tonnes) A

Buffalo meat export (In 000 tonnes) B

Buffalo meat production(In000 tonnes) C

1987 75.97 51.4 59.14 207

1992 84.21 58 82.51 1182

1997 89.92 72.1 176.38 1365

2003 97.92 86.2 297.9 1467

2004 - 88.1 343.82 1483

2005 - 92.5 337.78

2006 - 97.6 459.94

2007 98.7 100.9 494.11

Correlation coefficient between A & B is +0.979598053 Correlation coefficient between A & C is +0.819653

Source: FAO and Indiastat.com

Milk Production, Meat Production &Meat exports

Source: FAO and Indiastat.com

Buffalo rearing..Age Group

Requirement of Dry fodder (In Kgs.)

Requirement of Green Fodder (In Kgs.)

Requirement of Concentrates (In Kgs.)

Milk Yield (In Litres)

Approxim-ate weight

Daily Expenditure

Below 1 year

2.5 1 0 0 80-100 Kgs.

Rs.15

1-3years 5 2 .10 0 200-250 Kgs.

Rs.25

3-8 Years 8-10 10 5 13 250-400Kgs.

Rs.60

8 years & above

8-10 10 3 10 400-450Kgs.

Rs.60

Dry Fodder: Rs.2/Kg.Green fodder: 50Paisa/Kg.Concentrate: Rs.8/KgLabor charges: Rs.20-25 for adult & Rs.10-15 for young animal per day

Source: Survey of dairy farmers of U.P., Haryana & Punjab

Reproduction & Lactating cycle

3 Year Animal

310 days Pregnancy

2-3 months milking

AI Parturition

AI 6-7months milking

Dry for 2-3 months

Our field study…

Adult ‘Fantar’ buffalo: Rs.45-55/Kg. (Rs.6000 to 14000/animal)

Calf: Rs.2000 to 3000Lactating buffalo: Rs.25000-Rs.50000Separate Mandi’sMilk and Meat prices

Looking into future….

Year Supply Demand Deficit as a % of demand

Green Dry Green Dry Green Dry

2005 389.9 443 1025 569 61.96 22.08

2010 395.2 451 1061 589 62.76 23.46

2015 400.6 466 1097 609 63.5 23.56

2020 405.9 473 1134 630 64.21 24.81

2025 411.3 488 1170 650 64.87 24.92

Source: Kerala Livestock Development Board

Supply and demand of green and dry fodder in India (Estimates 2025) (in million MT)

Future forecasts

CAGR of buffalo meat prices for the last 4 years: 16.06%

Export meat price/kg. in 2010-11: Rs.114.79/Kg.Factory Price of buffalo meat in 2010-11: Rs.95-

97/KgCAGR of milk for last 4 years: 4.92%

(Source: Milk price index Indiastat.com )

Milk price in 2010-11: Rs. 28.8Improved livestock health, US & EU MarketsUSDA Production increase @5 per cent (2.8

million tonnes in 2009)

Domestic consumption Rise!!!

USDA report Increase @ 7 per cent in India"India’s exports are foreseen to remain firm

at 8.1 lakh tonnes, the bulk of the expansion is driven by increasing domestic consumption"

(Source: USDA and Asian buffalo magazine)

Conclusions

At present there is no significant impact of buffalo meat industry on milk production The correlation coefficient b/w buffalo meat production &

Milk production is +82% The correlation coefficient b/w buffalo meat exports & Milk

production is + 97 % Whole supply chain (Mandis’) of productive and

unproductive animals is different Milk: Rs.25/Kg, Daily expenditure: Rs.60/kg, Break even: 3

litres/day The present slaughter rate of 10.9% (Source: FAO

estimates) Pressure on limited resources Threat: Milk & meat prices Incentives to the buffalo meat industry New markets

Measures possible to adopt

Demand for equal thrust to dairy industry (Level playing field)

Animal registration, Proper education Only those buffaloes which are either non lactating

or economically unviable are sent for slaughtering. Buffaloes from all parts of country are sent for

slaughtering as soon as they become economically unviable.

Weight loss: Loss to farmer & Meat industry

Status in Gujarat

Same as in other parts of the countryMeat production for domestic demandMC Slaughter houses and slaughter slabs

Limitations of the study

Project coverageUnorganized industryIllegal activities (Secretive nature)Institutional support (outsider’s view)

Dying on the Edge….

Brutally Slaughtered

Aftermaths…

Supreme court Orders !!!!

Food Safety!!!

Thank You