Indian dairy exports are estimated at their highest level in eight years in FY22 on the back of robust demand, helped by higher world prices.
Provisional data for the first eleven months – from April 2021 to February 2022 – indicates that shipments reached 1.70 lakh tonnes valued at over $552 million, a growth of 93% in value and 63% in volume. compared to the same period a year ago. In terms of rupees, exports reached ₹4,115 crore, a year-on-year increase of 94% from ₹2,122 crore, according to DGCIS data.
The surge in exports is fueled by strong demand for basic and value-added dairy products, coupled with rising world prices. Trade sources reported that cooperatives and private players saw good growth in dairy product exports during the year.
India, the world’s largest milk producer, had already recorded a record $727 million shipment of dairy products in fiscal 2014 when world prices were on the rise.
RS Sodhi, managing director of the Gujarat Co-operative Milk Marketing Federation (GCMMF), which sells products under the Amul brand, said the growth was due to exports of commodities such as skimmed milk powder (SMP) , although branded products saw the usual annual growth. 15 to 20%.
Amul shipped approximately 35,000 tonnes of SMP during the year. The country’s largest cooperative’s export revenue in FY22 recorded a growth of 300% to around ₹1,450 crore from ₹520 crore in the previous year.
“Rising feed costs and shortage of fertilizers are impacting milk production in dairy-rich countries, which is driving demand for Indian dairy products. We have never been competitive in the dairy fats segment, but now the global fats market is about 20% larger than India,” Sodhi said.
Trade sources said unfavorable weather conditions in New Zealand and Australia have affected milk production in those surplus countries, leading to historically high international commodity prices. This has helped Indian entities to export products such as SMP, butter and whole milk powder, among others, to dairy-deficit countries. The United States, Bangladesh, United Arab Emirates, Saudi Arabia and Malaysia are some of the biggest buyers of Indian dairy products.
The average realization per ton of Indian exporters was $3,238 from April to February, about 19% higher than the $2,726 in the same period a year ago. “Global prices were 15-20% higher than in India’s domestic market,” Sodhi said.
Sources said Karnataka Milk Federation (KMF), the second largest dairy cooperative in the country after GCMMF, shipped about 1,000 tons of SMP during the year.
Despite record exports, Indian dairy players are still holding ample stocks of skimmed milk powder and other products. Early rains in the south could lead to the early start of the production season or peak production in Karnataka and Tamil Nadu, sources said.
Current stocks of SMP in the country exceed one lakh ton, which is enough to meet the needs this summer, Sodhi said.
Commenting on the export outlook for the current fiscal year, he said, “The outlook is good. This year too, we have good orders. The Indian market being good, we are not more involved in the export market”.
April 14, 2022