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GCMMF to launch liquid milk in US, and export dairy products to Canada

The Gujarat Cooperative Milk Marketing Federation Ltd (GCMMF) - which markets milk and other dairy products under the brand name Amul - plans to launch fresh dairy products in the United States market within a few months and liquid milk in the country within a year, and to export dairy products from the United States to Canada and Europe in the long run.

R S Sodhi, managing director, GCMMF, confirmed that there was a definite plan to launch liquid milk in the United States market, but it would take a while, as would exports to the European countries. “However, exports to Canada would commence soon,” he added.

With effect from February 2014, GCMMF will start manufacturing ghee (clarified butter) and paneer (cottage cheese) at a plant owned by a non-resident Indian (NRI) in New Jersey. The Kaira District Cooperative Milk Producers Union Ltd in Anand, Gujarat, which is better known as Amul Dairy, has entered into an agreement with the plant.

According to R K Srivastava, managing director, Amul Dairy, no additional investment would be required to launch liquid milk, because the local manufacturing unit already has the capacity to make paneer, and has invested close to $2 million to manufacture ghee.

The dairy major has also tied up with a local cooperative dairy to procure milk for processing. In the long run, it may also opt to buy directly from local dairy farmers. Sodhi said, “We would pay at par with the prevalent rates in the United States. The procurement prices in the United States are more or less at a similar level as those in India.”

Initially, it would require around 50,000 litre milk a day. It plans to make around five tonne ghee a day and two tonne paneer a day in the first phase, and eventually add products such as lassi, yoghurt and shrikhand, besides scaling up production for ghee and paneer based on the demand.

Amul plans to sell its products in markets such as New Jersey, New York and Boston, which have significant Indian populations. According to Srivastava, the region is home to about four million Indians and about five million other South Asians (including Pakistanis and Bangladeshis).

“It is akin to catering to cities like Mumbai and Delhi, which have huge populations,” he added.

If four million Indians (i.e. about one million families approximately) consume even 1kg dairy product, the demand would reach 1,000 tonne a month from households alone. The locally-made products would also be 10-15 per cent cheaper than Amul’s products, which are imported from India and on which a 20 per cent duty has been imposed.

“We usually export ghee from here to the United States, but it takes about a month-and-a-half to reach. Also, while there is a promising market for paneer (in both households and restaurants) in the United States, we cannot export it from India, as it is a perishable commodity,” Srivastava said.
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