Economics of milk production and profitability of different cow unit sizes in Srinagar

Abstract

Dairy farming is one of the choice options for business startups among budding entrepreneurs and progressive farmers in the valley. However, the apprehensions of profitability as well the size of cow unit (CU) to begin with, do exist in their minds. Keeping this in view, a study was planned with an objective of analyzing the economics of milk production viz-a-viz various cow-unit sizes in Srinagar. The study was carried out zone-wise as well as cow unit wise to assess the viability of dairying in the district and to find out the profitable size of the cow unit respectively. A total of 616 farmers were included in the study. It was found that dairy farming was a profitable venture in Srinagar District with Net Returns per litre of milk being ₹ 3 on an average. However, profitability seemed to be dependent on the size of the cow-unit as well with Net returns per litre of milk being ₹ –1.98, ₹ 2.90, ₹ 12.77 and ₹ 16.02 in CU 1, CU 2–4, CU 5–9 and CU above 10 respectively. This clearly indicates that a dairy venture can be started with a CU 2–4 at the beginning to gain experience, which can be later expanded to a CU 5–9 and eventually to CU more than 10 up to a suitable and sustainable level depending upon farmer’s individual situation.