Industrialising Supply Chain, a new BOOM for Dairy Industry

MilkLane (ML) is India’s first industrial-scale collection and distribution platform for high quality milk. The company aims to transform the supply chain of the world’s largest dairy market by applying international quality standards & technology and innovative processes, to the ‘first mile’ of milk that is high in quality, toxin-free and antibiotic safe to industrial processors, FMCG companies, milk product manufacturers and end-consumers. Agriculture World was in conversation with Gaurav Haran, Chief Operating Officer (COO) at Milklane, who is responsible for managing P&L and driving purposeful growth with focus on innovation & technology. 

Excerpts from the conversation : 

What makes Milklane a unique model ?

Milklane's unique rural entrepreneurship model uses the constructs of Bulk Cooler Operators (BMCs) and Small Industrial Production Unit (SIPU) farmers. It goes a step further by socially impacting the lives of dairy farmers by educating them on best dairy practices, providing veterinary services, high quality feed and fodder and facilitating finance and insurance services to help them grow and become independent. This holistic support from MilkLane is creating positive transformation in the lives of rural communities in and around Kuppam, Andhra Pradesh. The company aims to scale up its operations across India thereby improving the lives of thousands of dairy farmers.

How has the journey been for Milklane ?

Journey of MilkLane so far:

What is the working system/model of MilkLane?

MilkLane procures milk directly from the dairy farmers and delivers it to industrial scale off-takers such as industrial processors, FMCG companies and milk product manufacturers. The dairy farmers bring the milk to the strategically located Bulk milk cooling centers, maintained at the temperature of four degrees Celsius, which preserve the freshness of the milk by inhibiting bacterial growth. The collected milk is then subjected to a series of tests, which includes determining the fats & solids-not-fat (SNF) components and antibiotics & aflatoxin contamination in the milk to keep track of its safety and purity. Only when the milk meets the high standards set by MilkLane, it is supplied further down the value chain. 

From where did you get an idea to start this venture?

India is the largest milk producer in the world with millions working across the supply chain of the industry. Even then, the sector largely remains unorganized with collection and distribution still underdeveloped. This has led to problems like poor quality milk which often at times is contaminated with antibiotics and toxins. The high levels of adulteration found in the milk and milk products has always raised questions about the quality of milk available for consumption. 18-20 percent of the daily milk produced is channelized through the organized segment and pasteurized, whereas a whopping 80 percent of the industry remains unorganized. The milk supply, which comes from millions of small rural or local producers, still does not adhere to basic acceptable standards of production and hygiene making it unfit for consumption and ultimately creating inefficiencies in the supply chain.

MilkLane realized this huge opportunity and aimed to create a brand which can address these challenges by fundamentally transforming and modernizing it with a focus on creating high-quality toxin-free and antibiotic safemilk. That’s how MilkLane came into existence

The company is incubated by Pioneering Ventures, one of India’s leading agri-food platforms, specializing in incubating and building large-scale, vertically-integrated agri-food businesses. The company is dedicated to fostering inclusive growth in an environmentally sustainable fashion while providing attractive returns for its co-investors. Pioneering Ventures has already set up for companies such Desai Fruits & Vegetables, Citrus Processing India Ltd andFarmLink.

How farmer’s community getting benefits from Milklane?

With a focus to develop India’s underserved region, MilkLane works in bringing sustainable transformation in the lives of India’s dairy farmers. The company goes the extra mile for the dairy farmers with a holistic training program through which it educates and empowers them to realize their full potential. Its value-added services like animal breeding, feed solutions and veterinary supervision are designed to ease the farmer’s burdens and improve productivity and quality of their produce.

MilkLane believes that in order to get high-scale quality milk, one must create a procurement platform which provides all the necessary services and requirement to dairy farmers. The company helps dairy farmers by optimizing the land-labor-livestock balance, through feed and fodder management, genetics and young stock management, prevention of disease, reproduction management, manure & waste management and risk mitigation.

What kind of solution are you providing to milk industry and Dairyman?

MilkLane always aims to bring the best of both worlds by creating aself-sustainable model for dairy farmers across India, providing high-quality milk and ensuring the growth of the Indian dairy industry. To ensure that milk industry continues to grow in a healthy, sustainable manner it is important to assess each element in the supply chain and modernize it with a focus on creating toxin-free and antibiotic safe, high-quality milk. MilkLane providesDigital solutions and data analytics to create supplier intelligence, improve efficiency and cost effectiveness of processes and monitor supply chain in real time.         

IT enabled milk procurement systems provided by MilkLane allows real-time monitoring of milk quality and quantity at BCO (Bulk Cooling Operators) and digitized swift payments.  The Bulk Milk Coolers (BMC), "one-stop-shop" units for dairy producers, provided by MilkLane is the answer to the lacuna in the industry. It brings down the time taken to collect milk to around 45 minutes as opposed to the 2-3 hours’ time frame for a typical central chilling/cold storage model, thus lowering bacteria formation. 

The growth of dairy industry in a country entirely depends on their farmers thereforeMilkLane always aims to upgrade the dairy farming sector by introducing socially responsible best practices to ensure highest standards of food safety & improved livelihoods. The key focus is always on building sustainable relationships with the farmer community to allow for the systematic creation of social impact through best practice sharing and other services which enable farmers to become successful entrepreneurs.

Some of the solutions provided by MilkLane to farmers are:

• Feed and Fodder Solutions: Systems to provide holistic fodder and nutrition management solutions. Provide own branded cattle feed with scientifically developed recipe; high protein fodder varieties and other unique feed components (e.g. lactic acid bacteria). It also introduced cash crops with quality post-harvest residues that is used as fodder, developed silage banks and the use of hydroponic fodder machines.
• Veterinary Services: Training programs for producers and BC operators on milk quality with a focus on improving animal health and driving corrective interventions in high Antibiotic and Aflatoxin contamination areas. Breeding and preventive care services as well as periodic breeding and veterinary camps offered in collaboration with NGOs.
• Business Services: Holistic support programs for progressive farmers to facilitate installment of Small Industrial Production Units (SIPU) which also allow to demonstrate modern milk production techniques and state-of-the-art animal care.
• Transparent producer price discovery mechanism
• Digitized payment process with committed timelines
• Assured steady incomes
• Access to social benefits
• The company’s bulk cooler operators modelplays a vital role in creating employment opportunities in rural India.

According to you how is technology helping farmer community?

Technology is already being used for better quality control at collection center along with a transparent pricing system. One of the biggest advent of technology in helping farmer community is the timely and direct-to-farmer payments for their produce in real-time.  With IT enabled milk procurement at the Bulk Cooling Operators, it helps farmers to know the quality of milk produced and the right price they should get for it. All this done and monitored in real time, in presence of farmers maintaining the transparency on price mechanism. Better the quality, better the price they get paid for it.

Technology is also being used in the areas of providing advisory services, animal breeding and ration management through TMR. It is allowing us to directly communicate with farmers and provide advisory services over their phones. While in infancy, it is growing at a very rapid rate helping overcome some of the logistical constraints as well. Also,inbreeding services like artificial insemination, using sexed semen is further benefitting the farmers with higher chances of female calves.

Where do you see milk industry in the next 5 years in term of technology?

We believe technology will change every aspect of the industry from production to supply chain to processing and new product development. It will help create higher productivity and quality through better progeny,traceability across the value chain, lower cost of advisory services. Better technology would lead to more tailored feed and fodder solutions that would provide for sustainable and cost-effective rations with high productivity and quality of milk. Technologies like tagging and remote monitoring will further help with more efficient animal management. We also believe that the human touch (involvement) will continue to be critical for a more sustainable and socially impactful industry. 

What is your strategy for growth of ‘Milklane’?

MilkLane plans to scale up volumes across regions. MilkLane existing model can be replicated across multiple geographies. Right now, we are active in the southern states of Tamil Nadu, Andhra, and Karnataka. We can easily replicate this model in the West and East. We plan to engage and tie up with off takers,toreplicate such a platform for not just milkbut multiple crops.

MilkLane is also diversifying into consumer business with value added products along with providing feed solutions beyond its own network.

How has been your experience working with farming Community?

Our experience has been very enriching and our engagement with 8000 farmers has made us more compassionate. Which is why, our endeavor to socially impact their lives is extremely important by giving them due respect, being transparent and providing right value for their produce. Moreover, we have been able to drive significant and difficult changes to help farmers see clear value in the long term. Leveraging their latent knowledge and bringing in best in class technology and processes is helping us to improve their livelihood and build their trust.