Europe’s second-largest farm products company DLG is entering India in partnership with the publicly listed a milk and dairy products manufacturer, Prabhat Dairy as part of its strategy to expand in the fast growing animal feed market. Copenhagen-headquartered co-operative Dansk Landbrugs Grovvareselskab (DLG) is into production of high-quality vitamin-mineral feeds and farm supplies.
A source close to the development told BusinessLine “The strategic alliance is part of Prabhat Dairy’s plans to venture into animal nutrition business, which includes cattle feed, nutrition supplements and animal genetics, by launching a separate business. At present, cattle feed forms a major part of animal nutrition in India and the move is to capitalise on its huge potential.”
The source also added, “For the Indian company, this is backward integration to its milk and dairy products business.”
This bond will help the firm to strengthen its production chain and build its association with the farmers. The supply of superior quality animal nutrition products will help in increasing milk yield.
By 2020, it is expected that India’s animal feed industry, which primarily comprises cattle feed and poultry feed is expected to be worth $30 billion.
The list of Prabhat Dairy’s product offerings include pasteurised milk, flavoured milk and sweetened condensed milk among others.
Its integrated business model encompasses all aspects of the dairy industry value chain, including cattle feed supply, engaging with farmers on cattle health and milk production and procurement of raw milk among others.The company, has two manufacturing facilities in Navi Mumbai and Srirampur, Ahmednagar also intends to double its general retail reach to 2 lakh stores by 2020. In 2018, Prabhat Dairy started with two new packing stations at Solapur and Amravati, increasing the total number to four.