Examining Profitability and Viability of Urban and Peri-Urban Dairy Farms

Abstract

Cost benefit analysis in 20 each urban and periurban dairy farms nearby Navsari city of Gujarat, India were studied. The required information from selected farms was collected through personal interview. The collected and derived data were subject to statistics as per standard technique in Statistical Package for Social Sciences (SPSS) software. Total fixed cost in urban and peri urban area was Rs. 2.27±0.36 and 2.05±0.33 lakh, respectively. Among total cost, fixed cost was 11.42%, further; it was nonsignificant among urban and peri-urban farms. Total variable cost was looked higher in urban farms i.e. Rs.18.97±2.47 and 14.50±2.33 in urban and periurban farms, respectively, however, it was nonsignificant between two areas. The proportion of variable cost was major (88.58%) among total cost. Among total cost feed-fodder cost was highest i.e. 70.10% followed by labour cost i.e. 17.13%. Gross total income was found higher in urban farms but it was nonsignificant between two regions. Pooled gross total income was Rs. 23.05 lakh. Average total income from sale of milk was Rs. 21.70 lakh (92.72%). Sale of animals (4.31%) and sale of dung (2.98%) was also having some contribution in return. The average net profit in urban farms was found nonsignificant higher i.e. Rs. 5.52 and 3.48 lakh, in urban and peri urban farms, respectively. When farms was compared based on net return per adult unit the urban farms was significantly more profitable (US$ 172 v/s 136). The net profit per litre of milk was Rs. 9.20 and 6.80 in urban and periurban farms, respectively. The overall benefit cost ratio was found 1:1.20. It was also higher in urban area. Thus, it can be concluded that urban and periurban dairy farms are profitable and viable enterprise.