Dairy Industry in Andhra Pradesh worth INR 432 Billion

The dairy industry in Andhra Pradesh is expected to experience a remarkable growth on account of forces like inflating consumer incomes, rising health-consciousness, improving distribution networks and government initiative to organise the sector.

With some of the richest livestock resources, Andhra Pradesh represents one of the most advanced states in animal husbandry activities and the third-largest dairy market in India. Most of its milk production comes from farms of less than 2 hectares with 1-5 dairy animals. The state experiences moderate to high temperatures throughout the year with only slight variation between seasons. Despite this, the milk yield per cow in the state is slightly higher than the Indian average and is still rising at a faster rate.

Over the past several years, various efforts have been undertaken towards the development of the dairy sector in Andhra Pradesh. The State Government has been promoting mini dairy units with five milch animals each through subsidies on the animals. Additionally, three new milk chilling and processing facilities are being planned at Madakashira and Kalyanadurgam in Anantapurand at Pulkal in Medak district. New bulk cooling plants are also being planned for Warangal and W Godavari districts. Moreover, the Government further intends to invest 723 crores for expanding marketing facilities and cooling units in Tier II and Tier III cities of the state. Apart from this, the state has also been included in the National Dairy Plan (NDP) of the National Dairy Development Board (NDDB), wherein rural milk producers will be offered greater access to the organised milk processing sector.

According to a latest report by IMARC Group, the dairy market in Andhra Pradesh reached a value of INR 432 Billion in 2016, growing at a CAGR of around 13% during 2010-2016. Findings from the report also suggest that the organised market accounted for around 30% of the total sales in 2016 and is further expected to reach nearly 33% by 2021. This can be attributed to factors such as strong economic growth, elevating consumer incomes, health-conscious consumer base, improving distribution networks and government initiative.

At present, liquid milk is the biggest product segment in Andhra Pradesh, accounting for more than 60% of the total market share. On the other hand, the fastest growing segments include frozen/flavoured yoghurt, cheese, UHT milk, flavoured milk and butter milk. As the market is highly fragmented in nature, there prevails an increased competition among the players. Some of the leading players operating in the market include:

  • Vijaya (Andhra Pradesh Dairy Development Cooperative Federation Ltd.)
  • Tirumala Milk Products Limited India Ltd
  • Heritage Foods India Ltd
  • Dodla Dairy Ltd
  • Creamline Dairy Products Ltd.


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