Sunday, January 01, 2012: 07:22:31 PM

Food Processing Case Study

Dairy Whiteners in India - MOFPI

With market increasing at a rapid pace, established players as well as new entrants to gain

About 15% of the total milk output in India is estimated to be processed in the organised dairy.  The industry has maintained a high growth profile, especially in the wake of the Operation Flood, colloquially also termed as White Revolution, initiated in early 1980s. Today, India produces over 85 mn tonnes of milk annually.  The total milk economy is estimated at Rs 1300 billion in terms of value.

The market for dairy whiteners (commercially known as beverage milk powders and condensed milk) and creamers is around Rs 3,000 mn. Apart from MNCs like Nestle and companies like Britannia, the Indian enterprises have also made perceptible progress.  Names like Amul, Sapan, Vijaya, Mohan, Parag and several others have been seen in the marketplace with their whiteners.  These are available mostly in pouches, tetrapacks, and in the near future, may be in miniportion cups.
The dominant players 
Aseptically packed creamer in mini-portions is widely used in the West, but has yet to enter the Indian market in any substantial way.  Amul did make a beginning with its whitener pouches and has emerged as a leader with a market share of 45% followed by Nestle’s 23%. Aseptically packed creamer involves techniques to impart a longer shelf life to the product.  It is packed in small cups ready to be poured into a cup of tea or coffee.   Creamer is fresh milk with increased fat content (up to 12%) and is aseptically packed after undergoing Ultra Heat Treatment (UHT) at 1400 C. Its introduction will affect the existing whitener market as a natural milk product with a longer shelf life. 
Britannia forayed into the dairy business as a diversification move in 1997. Its first offering, Milkman Butter, just managed a 5% share. The dairy business claims a 10% share in Britannia's topline. The company had drawn up plans to at least capture 5% of the overall fresh milk market estimated by Britannia at Rs 420 billion.  Extending the product portfolio beyond cheese, dairy whitener and butter, Britannia entered the fresh milk segment in 2001.  In the dairy whitener, the company has managed to capture a significant market share.
Nestle India with its Everyday dairy whitener has established its brand well. It has also entered into the market with its Nestle Pure Milk and, of course, a product in its niche area, Nescafe Frappe. Having earlier launched UHT milk, Nestle is concentrating on expanding its reach. Its plans   covered   Rs 800 mn investment in its Moga (Punjab) facility. New product segments like butter, yoghurt and flavoured milk were also on the cards.
While Sapan characterises it as Dairy Special (instant milk mix for tea and coffee), Vijaya is the only UHT processed milk homogenised brand sold in the market in 200 ml and one litre tetrapack. All the rest, Amulya, Meadow, Mohan, Parag and Shweta dairy whiteners are in the form of powders. Mohan also markets a non-dairy whitener alongside its dairy type product. 
Since India is a major consumer of tea and coffee, it would be a very large market if only the price was not a constraint.  In addition to domestic consumption, the whiteners/creamers find a high level of institutional acceptance, especially by railways, hotels and restaurants, airlines, hospitals and nursing homes and corporate offices. The institutional market can be tapped first, in particular, the airlines, railways and hotels. The penetration can then be extended to the household sector. The potential for exports, especially to neighbouring countries and the countries in the Middle East, the Gulf and Africa, also exist and could be exploited.
This case study has been done by the Ministry of Food Processing Industries.

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