CHENNAI: Aavin has undergone a major transformation over the past two years through a systematic approach, says Minister of Milk and Dairy Development, T Mano Thangaraj. “We have improved our product quality by enhancing work culture, organisational ethics, skill development, efficiency, and more,” he notes.
Achieving growth in milk procurement from 26 to 36.5 lakh litres in just one year is no small feat. Previous governments did not make serious efforts in industrial automation and computerisation, but this is now being addressed, he explains.
The functioning of Aavin, from milk cooperative societies to dairies, often evokes memories of government offices in the 1980s, with a lack of data, manual operations at dairy plants, handwritten receipts for farmers, and more…
I don’t want to blame previous governments, but somehow enough attention had not been paid to industrial automation and digitisation. To address this, I've ordered the issuance of system-generated acknowledgement slips to milk-supplying farmers to protect them from being exploited by societies. About 50 per cent of the 9,500 milk producers' societies have begun issuing these slips.
We’ve also allocated Rs 72 crores for the automation of milk packing conveyors in dairies.
Additionally, Aavin is setting up a fully automated advanced dairy in Namakkal, comparable to those of leading private companies. Through energy efficiency programs, we’ve reduced our power bill by Rs 45 lakh per month, resulting in annual savings of Rs 6 crores.
Aavin remains one of the most trusted dairy cooperative brands in the country, second only to giants like Amul and Nandini, which procure an average of 1.23 crore and 83 lakh litres of milk per day, respectively. However, your market share in Tamil Nadu is just 18% (36 lakh litres) out of the two crore litres produced daily. Why?
I completely disagree with this assessment. Nearly 7,500 societies in the state are running profitably. For a society to make a profit, it must produce at least 1,000 litres of milk per day. These societies receive large quantities of milk and sell most of it locally. When we report 36 lakh litres, it only accounts for the milk supplied to Aavin; it doesn’t include the milk sold locally by the societies. In reality, we receive 73 to 75 lakh litres a day, making our market share closer to 38 to 40 per cent. Now that we’ve started issuing acknowledgement slips to farmers, milk procurement data is recorded through a cloud database, and soon, we’ll have scientific data on this.
What is the market share of Aavin milk products?
We don’t have exact data on this yet as it's currently being assessed. However, we expect our product sales to double in the next few years, especially since we've decided to sell through fair price shops.
How did you manage to overcome last year’s milk crisis?
We adopted a holistic approach to ensure the satisfaction of every stakeholder enabling us to increase our daily procurement by 10 lakh litres within a year. This was not an easy task. First, we raised the incentive for dairy farmers by Rs 3 per litre. Then, we ensured timely payments and facilitated loans through cooperative and private banks at nominal interest rates.
We also took steps to boost the earnings of societies, granted a 4 per cent hike in pending dearness allowance for employees, and promoted all eligible officers. Finally, we kept our prices low to benefit consumers. Aavin milk varieties are priced Rs 6 to 12 per litre lower than private brands. We (Aavin) have done justice to all.
Any comments on the reduced sales of the Green Magic variant (4.5 per cent fat), which had a substantial consumer base?
The human body requires only 3 to 3.5 per cent fat in milk. Aavin Delite, with 3.5 per cent fat, faced criticism when it was introduced last year, but it is now widely consumed across the state. Milk from cows naturally contains about 3 to 3.5 per cent fat. For the benefit of our consumers, we have also reduced sugar levels in our products, including milkshakes and other items.