Marketing and Financial Analysis of Milk Production- A Value Chain Perspective

Abstract

Article History JEL Classification: M31Livestock is the premier animal protein supply cradle to human dietary menu and milk is considered as one of the best diets for human nutrition. Gap between demand for and supply of milk is acute in the country. Triggering these views, the study taken objectives were to estimate profitability of milk production and to determine value addition at different levels of milk marketing. Study areas were selected from three districts namely Panchagarh, Chittagong and Sylhet, purposively considering the representation of normal milk available area, milk pocket area and milk deficit area. Total sample size was 390 (300 farmers and 90 traders). Simple random sampling technique was followed for selecting the respondents. Field survey method was adopted to collect primary data from January to March/2016. The study reveals that the production cost of milk for cross-bred cattle was estimated BDT 43,673/ ton. Per ton net return was estimated for cross-bred cattle BDT 2,543. Average gross margin and net margin per 100 liters of milk for milkmen was estimated BDT 5,479 and BDT 969, respectively. In case of sweet seller, average gross margin and net margin per 100 liters of milk (equivalent to 67 kg sweets) were estimated BDT 11,888 and BDT 4,875, respectively. For tea sellers, average gross margin and net margin was also estimated BDT 12,537 and BDT 6,194, respectively. It was observed that value chain actors i.e. milkmen, sweet seller and tea seller added value. On average, milkmen added value 29%, sweet seller 150% and tea seller 175%. Contribution/ Originality:This study is one of very few studies which have investigated the current status of profitability of milk production and its marketing channels where various market actors are involved. It has also estimated the marketing margins and value addition of by the actors.

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