This blog has been contributed by Mayank Dhingra.

Name India’s top 5 crops!

We’ve all answered this question in our schools. I am sure your answer would have included wheat, paddy, and other common crops but never milk. Nobody even considers milk as a crop in India, let alone the biggest crop.

The reason behind it is that the Government always considered dairying as a subsidiary activity to traditional agriculture. Now you might ask why did the government do that. Basically, it is because animals feed on what traditional agriculture produces. Wheat and paddy straw, sugarcane tops and residues of mustard and cottonseed oil extraction are some of the examples.

In spite of the popular opinion, milk has now become India’s biggest farm crop by value. It has even overtaken food grains (cereals and pulses) in terms of production. The value of milk produced stood at Rs 4,86,846 crore in FY18. Milk also stood way above the crop value of paddy or wheat, according to the latest figures released this month.

The other day, I was reading that in terms of farm incomes, the contribution of the White Revolution has exceeded that of the Green Revolution. Not only that but every fifth rupee generated in the farm sector comes from milk. Milk is contributing around 26% to total agricultural GDP. The dairy industry is even expected to beat the IT sector as the largest employment generator. The sector is expected to generate 2 crore jobs annually in the coming decade. Isn’t that something to rejoice in the current slowdown?

Given these facts, don’t you wonder why India falls behind in the global dairy export market? We even export various dairy products, such as whole milk powder, butter oil, ghee, whey products, dairy spread and cheese among others. It occurs because most of the dairy products produced in the country are consumed domestically. So, the export potential has not yet been tapped.  

Consumption of dairy products in India is quite different from western countries. It is primarily inclined towards traditional products such as ghee and buttermilk. However, westernized products such as processed cheese and flavored yogurt are gradually gaining momentum in urban areas.

Elaborating on the consumption trends, data confirms that the share of liquid milk has significantly increased in India. Apart from drinking milk directly, we all know how much Indians love their tea. So, a big proportion goes into preparing tea and coffee. Traditionally, liquid milk and ghee were the major forms consumed apart from sweets. With time, milk is being converted into other forms such as butter, milk powder, ice cream, cheese, and condensed milk. Today, only 46 percent of milk is consumed as liquid milk, while the remaining 54 percent is converted into various dairy products.

With changing lifestyles, our schedules have changed but the need for milk hasn't. We now want to receive everything at the doorstep. Catering to this need, companies have digitized their operations. They are now reaching the customer’s doorstep to deliver their product. A change in lifestyle has also altered the expected nutritional requirements from milk for different age groups and routines. As a result, we are spoilt for choices. Raw, farm-fresh, toned, pasteurized, full cream, skimmed, non-fat, etc. are just a few types available today.

If you ask me, this is a great time to be innovating and investing in the dairy industry. And, in order to survive and thrive in today’s market, the industry needs to consider a number of trends that are coming up in 2019. They are likely to impact the future consumption of dairy products. Here are the top four trends I see-

1. Sustainable and Organic Nutrition
Today, close to 30% of the world’s population, is either obese or overweight. We also realize the stress our consumption needs are putting on the environment. This is driving a ‘conscious consumerism wave’ across the globe.  Consumers are beginning  to consume what’s grown sustain-ably and organically.

This latest trend has become a healthy challenge for companies. We, as consumers, are loving the health and environmental benefits of the latest products. Companies are working on enhancing health and nutritional outcomes. Reducing the environmental impacts of the dairy products produced is another challenge faced. As a result, a number of dairy companies have adopted the idea of sustainable nutrition to attract consumers. This is helping us create a sustainable food system. It also fulfills the UN’s 2030 Sustainable Development Goals.

2. Dairy innovation for
The millennial generation is driving a new trend in both the developed and developing world. They want to consume natural foods that enable them to lead active and healthy lives. After all, our country is banking on them for our future.

This trend is actively being adopted by companies and has resulted in some intriguing insights. For example, identifying the role of gut microbes in health. Research and innovation in this field is growing. It is emphasizing on weight management, improved well-being, and reducing the occurrence of various diseases.

3. Trace-ability and transparency
The need for transparency is at an all-time high among today's consumers. Don’t we want to know every detail about the products we consume? We expect brands to share everything with us- from how the product is made to how it is delivered. In response to this, companies have begun sharing details like their raw material sources and even nutritional information about the product.

Companies have also started to adopt newer technologies such as block-chain for efficient working. It is a great opportunity for them to trace their products efficiently. Consumers can also have a better understanding of the various levels their product goes through.

4. A net positive approach to dairy agriculture
The burden to provide enough food, fuel, and fiber for an ever-growing population like ours is increasing on land. At the same time, the dairy industry is affected due to the changing climatic conditions of our planet. The change in climate affects the vegetation and eventually cattle because that’s what they feed on. We are also increasingly becoming aware of depleting soil quality, water stress and rapid rates of extinction of various plant species. Consequently, we expect our brands to support our cause to work towards the betterment of our environment.

To tackle the issue, businesses have started to move towards a more inclusive approach. Under this, they look at how they can restore local ecosystems around them. They also try to improve livelihood and community outcomes. New age businesses are now recognizing the need to be “net positive”.

As an ending note, I would like to mention that the majority of these trends are coming up due to increasing urbanization. Another reason is the sudden spread of modern communication systems like television and increasing emphasis on advertisements. As a result, the consumption trends for dairy products are fast-changing all over the country. Do you see these trends around you? Or do you have any interesting insights on dairy industry?

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