Performance of KCMMF

Annual Report2011

Financial year 2009- 2010

 

Milestones of the Year 2009-10

INPUT SERVICES AND WELFARE MEASURES

• Our Regional Milk Unions are carrying out various input activities in their milk sheds and a gist of the activities is carried out by the Regional Unions in the financial year 2009-10 is given below:

TRCMPU

• TRCMPU is carrying out various input activities in its milk shed and a details of the activities carried out by the Regional Union in the financial year 2009-10 are given below:
• Union has distributed Rs. 4.00 crores as price incentive to the societies and Rs. 3.5 crores as summer incentive to the farmers.
• In the financial year total no. of 465 first aid centres are functioning in four districts and 29336 no. of cases were attended.
• Total no. of De-centralised veterinary units are 30 and 29681cases had been attended.
• Total no. of Production enhancement camp (Gosamvardhini) conducted is 244 and total no. of cases attended is 12013.
• 50 % subsidy on Cattle insurance premium.
• Total A.I centres functioning under union is 26 and the total no. of A.I performed is 9211.
• Under IDDP Scheme, 65 hectors of land was cultivated under fodder development programme in, Pathanamthitta District.
• Under IDDP-CMP Program, various projects are implemented with the financial assistance to the tune of Rs. 10.06 crores from the Govt. of India. 52 bulk coolers were installed with a total capacity of 1.96,000 litres.

Schemes for Milk Production Enhancement

• Rs. 137.68 lakhs was spent for Calf adoption scheme
• Insurance subsidy for new Mini Dairy units was given for a amount of Rs. 3.15 Lakhs
• Cattle feed subsidy for new Mini Dairy Units was given for Rs. 37.39 lakh.
• Rs. 3.22 Lakhs was spent for Fodder cultivation schemes.
• Rs. 22.57 Lakhs was spent for Deworming.
• Under Benevolent fund scheme financial assistance to depend of deceased farmers and scholarship for higher education are given Rs.25.64 Lakhs spent during 2009-10.
• De-centralized veterinary Units for providing veterinary service at doorstep of farmers and free medicine Rs. 51.14 Lakh during 2009-10.

ERCMPU

• The Union distributed summer incentive of Rs.194.82 lakhs in the financial year to the farmers.
• Three defunct societies were revived in the current year.
• Animal health programmes were continued during the year. Total 9179 emergency cases were treated through emergency veterinary routes and 1823 cases through veterinary camps
• Artificial insemination service was extended through 118AI centers(75 single AI centers and 43 cluster centers) located at societies and 86170 ai were done through 247 societies attached to these centers.
• Union has started giving interest subsidy for the loans taken for cattle purchased during the year. Under this scheme a farmer is eligible to get interest subsidy for the first year of the loan at the rate of RS. 1200/- per animal for 4 animals. Union has distributed Rs.402703/- as interest subsidy during the year.
• Cattle insurance at reduced premium rate (2.325%) was continued through United India Assurance Company. Union has given premium subsidy of Rs.100/- per animal and this benefit was given for 2449 animals during the year.
• Building grant was given to 10 societies at the rate of Rs.20000/-.
• The group gratuity insurance scheme for APCOS employees implemented through LIC of India is continuing and RS. 5,34,984 was distributed as benefits during the year
• Subsidy@ Rs.1000/- each was extended to 282 farmers for purchase of milking machines.
• Rs.121.21 lakhs was contributed to the Dairy farmers Welfare Fund.
• Union has contributed 50% of the training cost for the training programmes of the Presidents,Committee members and staff of societies at the training centre of KCMMF.
• Union has remitted Rs.34.14 lakhs towards Cattle feed Intervention fund to KCMMF.
• Union has taken part in the preventive measures with necessary medicines at the FMD affected areas within the area of operation.

MRCMPU

• Paid Rs. 17.19 crores as incentive milk price to farmers in addition to the basic milk price approved by the Government.
• Provided Rs. 3.55 Crore as subsidy to farmers for cattle feed purchase.
• Conducted Co-operative Development training programme for farmers.
• Developed a fodder farm in 25 acres near Vadakkanchery of Palakkad District, in collaboration with a Fodder entrepreneurand purchased fodder from him at Rs. 1.50 per kg as per buy- back arrangement and supplied 90 MT green fodder to farmers through a fodder route.
• Supplied 298 MT baled straw through 87 milk societies during summer months.
• Supplied 144 MT wheat straw pellet to farmers, purchased from Khanna, Punjab.
• Provided Rs. 3.5 lakhs to 36 new/converted milk societies.
• Established 36 AMCUs in societies and provided Rs. 1.25 lakh grant, each.
• Supplied 1492 Milk Cans to societies with a subsidy of Rs.24 lakhs.
• Established 27 fodder plots
• Provided Rs. 24 lakhs to farmers as Cattle Shed construction Subsidy.
• Arranged training programmes for farmers, Management Committee Members and staff of societies.
• Provided Rs.18.46 lakh as building construction grant to societies.
• Covered 60,831 farmers under accident coverage insurance with a subsidy of Rs. 21.41 lakhs from the Union. Provided Rs. 36 lakhs as claim benefit.
• Covered 15,481 farmers under social security insurance of LIC. Premium fully paid by Union (Rs. 3.93 lakhs)
• Covered 21,044 farmers under the Janasree Bima Yojana of LIC with Rs. 10.25 lakhs as premium subsidy from the Union. Paid Rs. 23.5 lakhs as claim benefit.In addition, provided Rs. 24.70 lakh as scholarships to 3066 students of insured families.
• 18,958 farmer families were covered under the Medi claim insurance with a subsidy component of Rs. 15.87 lakhs towards premium from the Union (out of total premium of Rs. 43.24 lakhs).Rs.50lakhs distributed as claim benefit.
• Rs. 2.16 lakhs paid from the charity fund of the Union for treatment of fatal diseases of farmers.
• Provided awards and reward for best performing farmers and societies.
• 5,514 cows covered under the Cattle Insurance Programme with a subsidy of Rs. 1.7 lakhs towards premium. Rs.22.24 lakhs paid towards claim settlements.
• Paid Rs.6.69 lakhs as subsidy for farm mechanization ( Milk Machine, Rubber mats, fodder, Bio gas and Chaff Cutters).
• Covered 1500 heifers under the heifer development programme and provided cattle feed at 50% cost, free insurance, de-wormers, mineral mixture, fish oil and AI.
• Paid Rs. 156.96 lakhs as contribution to farmer pension scheme.

Highlights of the Year 2009-10

Report on Federation Units

CATTLE FEED PLANTS

• KCMMF has two Cattle Feed Plants, one at Pattanakkad and the other at Malampuzha with a combined capacity of 600 MT per day. The feed is distributed through primary cooperative societies, dealer networks and Government Departments engaged in Animal Husbandry activities. Milma cattle feed has wide acceptance among the farmers. The Price of feed supplied to APCOS is kept lower than the open market price APCOS are also provided with sales discount as well s incentive. Supplying good quality cattle feed by Milma at reasonable price acts as a control mechanism in the market for the competitors to maintain the quality and price of their feed which ultimately benefits the dairy farmers. Mineral Mixture is also produced at our Cattle Feed Plant Malampuzha and also distributed through our existing network. Despite heavy competition in the market we have established ourselves as one of the leading manufacturers of Cattle Feed.
• During the reporting year the raw material price of cattle feed experienced unprecedented price increase and shortage during the first half of the financial year. This affected the viability of operations of the Cattle Feed Plants. We could not implement the cattle feed price revision as the appropriate time and this paved way to production loss as well as financial loss to the Cattle Feed Plants.
• As per CLFMA report, in India there is a total installed capacity of 5 Million MT and the production of Cattle Feed by these plants is 3 Million MT, which is 60% capacity utilization in All India Level. Thus the performance of both Cattle Feed Plants is above All India Average in 2009-10. It is also to be noted that the complaints of sales returns due to fungal or lump formation was nil in both the Cattle Feed Plants. The MRP of 50 kg Gomathi BIS II type Cattle Feed is Rs.575/-. The Cattle Feed Plant is manufacturing Mineral Mixture in the name of “Milmamin” and the sales of the same during 2009-10 was77.224 MT which earned a revenue of Rs.37.36 lakhs.

• CENTRAL PRODUCTS DAIRY

• CPD is producing Ghee in two varieties (MILMA & SAMRIDHI) and MILMA PLUS – flavoured milk in five different flavours i.e. Chocolate, Cardamom, Strawberry, Pineapple and Mango. The sale of MILMA PLUS in disposable glass bottles created good response and the Regional Milk Unions of TRCMPU and ERCMPU is sourcing the product from CPD. Due to heavy milk shortages there was no milk conversion at MPF. Sale of some of the products as Ghee etc is affected due to non-availability of required milk. The CPD generated profit of Rs.145.00 lakhs in 2009-10.

• Milma Training Centre

  During the year of report, Milma Training Center continued to conduct need based and result oriented Training Programmes both in-house and off campus – for all the different functionaries of Primary APCOS aiming at improving the quality of performance of the human resources available at the societies which in turn improves their total functional effectiveness and efficiency. The Training module includes 'On The Job’ training and study tours. The system of non-formal and continuous evaluation continued during the year also. Post evaluation training has been done during the year mostly by visiting societies during off-campus Training Programmes. During the year we have trained 1391 trainees in both off-campus and in-house training programmes achieving 5447 Mandays.. The Training income during the year was around Rs.21.00 Lakhs. During the yearthe Ernakulam union has been allocated an amount of Rs.4,33,125/- in their budget for meeting half of the training charge of the user societies.

• PROJECTS -KCMMF

• The Projects section of KCMMF normally executes the Engineering Projects under Federation/Regional Milk Unions. Setting up of new Dairy Plants, Chilling centers, Cattle feed plants and expansion activities are done by the Projects section on consultancy basis. Projects are executed for the Dairy Department also on consultancy basis. Through this activity KCMMF earned Rs.8.03 lakhs as service charge in year 2009-10.
• The following infrastructure Developmental activities were taken up with the financial assistance of Govt. of India (IDDP & CMP) NDDB, State Government and using internal resources for KCMMF and MRCMPU during the reporting year.

• Cattle Feed Plant Pattanakkad

• Tender for the civil works for the New Raw Material Godown invited and work awarded. The construction of the Godown commenced during January 2010. This project is a part of the expansion activities of the plant from 300 MT to 500 MT per day with an outlay of Rs.575 lakhs. This Project is partly financed by the State Government under Assistance to Public sector undertakings for which Govt has sanctioned an amount of Rs.150 lakhs in the State budget

  Cattle Feed Plant Malampuzha

• The proposal for setting up of two numbers Grain Storage Silos and Construction of a 1000 Sqm Raw Material Godown was submitted to State Government seeking financial assistance under Assistance to Public sector undertakings with an outlay of Rs.597lakhs.

MRCMPU PROJECTS

Central Products dairy Naduvattom

• A new Ghee Processing Block was constructed at Central Products Dairy Naduvattom, Kozhikode and was commissioned in October 2009. A fully Automated Ghee Packing Line is installed in this new processing block. The mechanicaland electrical works related to the above Project was also completed. The outlay for this plant is Rs.200 lakhs. This project was partly supported by IDDP Scheme of Central Government and balance met from the internal accruals of MRCMPU.

  Kasaragode Dairy Expansion Project

• A new curd-processing block was constructed at Kasargode Dairy and was commissioned in December 2009. The mechanical and electrical works related to the above Project was also completed. The outlay for this project is Rs.180 lakhs. This project was partly supported by IDDP Scheme of Central Government and balance met from the internal accruals of MRCMPU.

  Palakkad Dairy Expansion Project

• The Expansion activities under IDDP Scheme and using internal funds of MRCMPU were completed with an outlay of Rs.215 lakhs in the financial year. This includes a new Ghee processing block, expansion of cold store, plant modification and expansion of Administrative Block. The mechanical and electrical works related to the above Project was also completed. The Structural Glazing work as part of HACCP was also completed. The second phase expansion activities have been commenced.

Kannur Dairy Expansion Project

• The Expansion activities under IDDP Scheme and using internal funds of MRCMPU were completed with an outlay of Rs.150 lakhs in the financial year. This includes New Marketing Block and the Modification of the existing plant building. The mechanical and electrical works related to the above Project was also completed. The Structural Glazing work as part of HACCP was also completed The second phase expansion activities have been commenced.

Pattambi Milk Chilling Plant

• The expansion of Pattambi Chilling Plant from 10000 LPD to 20000 LPD was completed under IDDP Scheme and using internal funds of MRCMPU with a total outlay of Rs.72 lakhs. This includes a new refrigeration system replacing the existing bulk cooling system. The mechanicaland electrical works related to the above Project was also completed.

Pattencherry straw pelleting plant

• The construction activities of a new straw pellet making plant at Pattencherry in Palakkad District were commenced in the financial year with an outlay of Rs.150 lakhs. This Project is partly financed by the State Government under Assistance to Public sector undertakings for which Govt has sanctioned an amount of Rs.65 lakhs in the State budget. During the year the Government of Kerala gave Rs.1.5 crores to KCMMF and Rs.65 lakhs to MRCMPU Ltd. as grant under budget support.

Computer Department -KCMMF

• KCMMF Ltd has a full-fledged Computer Department functioning at the Head Office. All the activities of KCMMF and its Units and Regional Milk Unions are fully computerized. The in-house developed ERP solution for managing Finance, Inventory, Asset Management, Pay Roll and HR, Raw Milk reception and Bill payment, Quality Control, Marketing of Milk & Products, Purchase, Cattle Feed Raw Material Procurement & payment, Cattle Feed Quality Control, Cattle Feed Production, Cattle Feed Marketing are in use at KCMMF and its Units, Trivandrum and Malabar Regional Milk Unions and its dairies.
• In line with the different dimensions of business growth, the IT group has also stepped up its efforts to ensure adequate support to all Units under KCMMF and Regional Milk Unions. The focus is on application implementation and process improvements while enhancing the overall security of the information assets of the Company.
• KCMMF Computer Center is extending remarkable computer support to KCMMF Units and Regional Milk Unions and its dairies by implementing KCMMF’s own Virtual Private Network between all units and KCMMF Computer Center. KCMMF Computer Center has implemented SMS solution for Cattle Feed Sales at Cattle Feed Plant Pattanakkad and Malampuzha.

Purchase Department -KCMMF

• A purchase committee comprising the Managing Director of Federation and three Regional Milk Unions, Senior Manager (Finance), Senior Manager (Projects) and the Manager (Purchase) of Federation finalize the purchase of Dairy Consumables. Tenders are invited for Dairy consumables and the suppliers are selected on the basis of quality and competitive price. Various packing materials are also sourced in the same manner. Procurement of raw materials of Cattle Feed is a periodic activity. The daily purchases are carried out by a purchase committee comprising of Managing Director of the Federation, Senior Manager (Finance), Manager (P&I&QC) and Manager (Purchase) of the Federation. The committee takes the advice from the Senior Managers of both the Cattle Feed Plants before finalizing the purchases of raw materials. It is an open market operation through brokers/ suppliers/manufacturers. The procurement system takes advantages of fluctuations in price of the commodities and evens out the peak price by bulk purchase on decline of price. The vendor base has expanded over the years ensuring regular supply of raw materials and packing materials of good quality at competitive price. This has helped us in maintaining the quality of our products. Over the years we have developed a loyal vendor base. This has ensured regular supply of quality materials at competitive price.

Our aims for the year to come

• Lean Flush Management: The Federation is actively involved in the lean-flush management to balance the deficit /surplus of milk due to seasonal variations. During the year 2009-10 there was furtherdrop in milk procurement compared to previous year in Trivandrum and Ernakulam Milk Unions and we could successfully meet the demand for milk by import of large quantity of milk from other Federations and by purchase of Skimmed Milk Powder. Similarly the Milk Powder prices were also reasonable compared to last year and so the overall lean management was viable for our Unions.
• The unprecedented rise in the raw material cost of cattle feed resulted in the financial viability of the cattle feed plants. The loss incurred by KCMMF was mainly due to provisioning of depreciation and there was cash surplus in KCMMF in the year 2009-10.
• Our endeavor is to improve the living condition of our farmers. This can only be achieved through ensuring remunerative prices to their produce and encouraging them to produce more milk and other agriculture products. We have to strengthen the hands of our farmers by enhancing their capability to produce more and thereby ensuring the prosperity of our nation.

How we fared?

The Federation achieved a turnover of Rs.193.64 crores in the year 2009-10 as against Rs.161.87 crores .

Turnover of KCMMF (Units wise - Rs.in Lakhs*)

YEAR	Cattle Feed Plant Pattanakkadu	Cattle Feed Plant Malampuzha		Central Products Dairy, Alapuzha	TOTAL
1996-97	2226.91	1212.65		1333.63	4773.19
1997-98	2069.16	1220.71		1463.66	4753.53
1998-99	3041.71	1903.05		1704.95	6649.71
1999-2000	4419.66	3667.48		2307.53	10394.67
2000-2001	4284.89	3798.49		2778.82	10862.20
2001-2002	4580.42	2922.4		3053.23	10556.05
2002-2003	4691.39	2691.13		2901.08	10283.60
2003-2004	4968.62	3124.79		3020.13	11113.54
2004-2005	4325.24	3885.46		3629.94	11840.64
2005-2006	5135.58	3602.57		4000.85	12739.00
2006-2007	5082.00	3954.00		4244.00	13280.00
2007-2008	4933.08	4738.22		4456.55	14128.00
2008-2009	5644.05	5074.30		5507.38	16186.62
2009-2010	6465.80	6747.92		6150.56	19364.28

 Ten lakhs = 1 million

Turnover & Profits of milma family (2009-10)

It is a matter of great satisfaction that milma family has achieved a turnover of Rs. 1144.78 crores.

 

	TRCMPU	ERCMPU	MRCMPU	KCMMF	TOTAL
Turnover / Rs crores	362.62	231.07	357.45	193.64	1144.78
Net profit/Loss	0.18	2.78	1.21	(-)0.75	3.42

 Ten lakhs = 1 million

Milk Procurement and Sales(Ltrs in Lakhs)

Year	Procurement	Sales
2000	2249.33	2308.69
2001	2487.11	2412.83
2002	2418.25	2558.59
2003	2179.73	2698.80
2004	2319.70	2841.21
2005	2630.14	3069.51
2006	2921.14	3340.05
2007	2722.90	3497.43
2008	2693.57	3475.22
2009	276.45	3575.91
2010	2729.00	3911.96

Ten lakhs = 1 million           

 

---

Back