Home ›› 30 Apr 2023 ›› Business Connect
Milk Vita, a milk and dairy product brand owned by the Bangladesh Milk Producers Cooperative Union Limited, has been the pioneer in the country’s dairy industry for decades.
It is currently leading the industry by holding at least 70 per cent share of the country’s liquid milk market, according to the company’s officials.
The company collects, processes, and markets about 3.5 lakh litres of liquid milk every day to meet the national demand for dairy products.
The demand for Milk Vita’s dairy products is increasing day by day owing to their time-befitting and diversified quality products in the markets.
Milk Vita started collecting and marketing milk through the cooperative after its first milk pasteurisation factory was established in Baghabari of Sirajganj in 1973.
Currently, it collects liquid milk from 132 upazilas of 32 districts under seven divisions and then processes and markets it all around the country.
Apart from milk collection, the company is also giving various types of support to the farmers to increase milk production, including loan facilities, free distribution of semen and vaccines as part of artificial insemination services, as well as supply of necessary medicines and establishment of cattle feed factories.
Talking to The Business Post, Bangladesh Milk Producers Cooperative Union Limited Chairman Sheikh Nadir Hossain Lipu said that the company started its journey in 1973 in line with a directive of Father of the Nation Bangabandhu Sheikh Mujibur Rahman following the model of India’s Anand Milk Union Limited (Amul).
“Milk Vita has been established with the aim to ensure fair prices of milk for marginal farmers to improve their socio-economic status and ensure the availability of milk in all parts of the country, irrespective of rural and urban areas,” he said.
“Once, ours was the only company in Bangladesh but now there is competition in the market as many companies are collecting and marketing liquid milk. But we are still dominating the market with quality dairy products,” he added.
The journey
In 1946, the dairy traders brought machinery to establish a milk factory, called National Nutrition Company, in Lahiri Mohanpur of Sirajganj as the dairy farmers in Pabna and Sirajganj areas were not getting fair prices.
However, the initiative to establish the factory was stopped due to the partition of India in 1947.
Later, in 1948, one Mukhlesur Rahman took ownership of the factory and changed its name to East Milk Products. Installation work of the factory was completed in 1952.
Dairy products such as milk, ghee and butter were produced at the factory and marketed in Kolkata city for a while.
In 1966, an initiative was taken to bring forth a cooperative-based primary milk producers association to the organisation and it was named East Milk Producers Co-Operative Union Limited.
In 1968, the Cooperative Marketing Society took responsibility for the factory as the cooperative management system was not initially fruitful.
However, due to financial bankruptcy, another organisation of bottled milk production and marketing company, named Ashtai Dairy, based in Tejgaon, Dhaka took responsibility.
But in 1970, due to a lack of proper management and financial support, the production and marketing activities of both factories were stopped.
After the independence in 1971, Bangabandhu Sheikh Mujibur Rahman took the initiative to run the milk factories based on the model of Amul, which is an Indian state government-owned dairy-based cooperative society officially named the Gujarat Milk Marketing Federation.
In 1973, a development project named Cooperative Dairy Scheme was taken up in a new area after paying off the debts of the two closed-down factories of the Cooperative Marketing Society.
Under the new initiative, factories were set up in five dairy regions of the country with the help of a government loan of Tk 13.12 crore to increase milk production by protecting the interests of dairy farmers.
In 1977, the name of the project was officially changed to Bangladesh Milk Producers Cooperative Union Limited (Milk Vita).
Since the establishment of the first milk pasteurisation factory in Baghabari in 1973, the cooperative has set up 43 milk cooling plants in different districts so far around the country.
As a part of the expansion activities of Milk Vita, the company has set up UHT Plant, Milk Vita Condensed Plant, Milk Vita UHT Milk Plant, Condensed Milk Can Making Plant and Milk Vita Candy Plant.
Dairy products
Milk Vita started production under cooperative management in 1973. It now has 11 factories across the country. Each factory has separate plants for manufacturing multiple products.
The company is run by farmers’ associations across the country and supervised by the Ministry of Local Government, Rural Development and Co-operatives.
It is currently manufacturing and marketing 22 types of dairy products, including pasteurised milk, powdered milk and other milk products, and supplies them across the country.
The products also include liquid milk, toned milk, flavoured milk, Labang, Matha, Rashmalai, Sweet Curd, Sour Curd, Rosgolla, Kacha Chana Sondesh, Para Shondesh, Khezurer Gur Shondesh, Mozzarella Cheese, Full cream powder milk and skimmed milk powder.
Milk Vita is also producing ghee, cream, ice cream, chocolate and special cake considering the demands of consumers.
The company had a turnover of around Tk 500 crore in FY2020-21, up from about Tk 300 crore two years ago.
Dominating pasteurised milk sub-sector
At least 15 companies, registered under Bangladesh Standards and Testing Institution, produce and supply pasteurised milk and milk and dairy products to the markets and Milk Vita is leading them.
The other companies are Pran Dairy Ltd (Pran Milk), Aftab Milk and Milk Producer Ltd (Aftab Milk), Akij Food and Beverage Ltd (Farm Fresh Milk), BRAC Dairy and Food Project (Aarong Dairy), Igloo Dairy Limited, Danish Dairy Farm Ltd (Ayran), Ichhamoti Dairy and Food Products, American Dairy Limited (MOO), Uttar Bango Dairy, Purbo Bangla Dairy Food Industries, Tania Dairy and Food Products (Safe), Rangpur Dairy (RD), and Zihan Milk and Food Processing Ltd.
Among the brands, Milk Vita, Aarong and Pran are dominating the pasteurised milk market with around 80 per cent share, leaving the rest 20 per cent to other brands.
The country produced 130.74 lakh tonnes of milk in FY2021-22. However, all the brands market pasteurised milk and UHT milk by processing only 7.5 lakh tonnes of milk every year.
Industry insiders said Milk Vita products have a huge demand in the market. But it’s not agile enough to change its marketing strategy like its competitors.
Contribution to milk production
Sector insiders said that Milk Vita is playing a vital role in milk production in the country by giving necessary support to the dairy farmers to produce milk, collect milk and market dairy products.
According to the Department of Cooperatives, Milk vita alone collected 3.93 crore litres of milk in FY22 from farmers and dairy farms across the country; 4.50 crore litres in FY21; 4.32 crore litres in FY2019-20; 4.69 crore litres in FY2018-19; and 4.68 crore litres in FY2017-18.
According to Department of Livestock Services (DLS) data, the country’s annual milk production was 119.85 lakh tonnes in FY21; 106.80 lakh tonnes in FY20; 99.21 lakh tonnes in FY19; and 94.06 lakh tonnes in FY18.
Milk Vita Chairman Lipu said, “We are supplying milk and dairy products to the market through a well-oiled management, from collecting and supplying milk to the market to ensuring quality products.”
“Also, we are giving all necessary support to the farmers to produce quality milk and its boosting milk production,” he said, adding that Milk Vita has become a profitable organisation because consumers are happy with its quality dairy products.
3 more projects underway
At present, Milk Vita has three more projects of Tk 498 crore — a milk plant for boosting milk production in Patiya, Chattogram, a diversified milk product plant and cattle development in greater Faridpur and adjacent areas, and a super instant powder milk plant at Baghabari Ghat in Sirajganj — that are underway.
Milk Vita officials said the project works of the Baghabari Ghat plant are almost finished and works in the other two are also ongoing.
Once these plants are operational, they will further boost the company’s existing milk production and dairy product production rates significantly.
There are also government initiatives to implement a few more projects worth Tk 2,565 crore to boost Milk Vita’s activities across the country.
With 1,100 employees at various levels, Milk Vita is currently carrying out its activities in all the districts of the country.
There are over 1.31 lakh members in 2,443 Primary Dairy Cooperative Associations under Bangladesh Milk Producers Cooperative Union Limited. The capital share is Tk 834.73 lakh, the savings deposit is Tk 1,013.88 lakh, the net profit amount is Tk 243.18 lakh, and the working capital amount is Tk 12,110.26 lakh.
There are also 81 central cooperative associations under Milk Vita.
Boosting powder milk production
According to data from DLS and the Bangladesh Bureau of Statistics, the country imported 150 lakh tonnes of milk powder worth Tk 2,800 crore with a 10 per cent duty in FY19 as its local production is very poor.
Nine companies, including New Zeeland Dairy (Diploma), Arla Food (Dano), Meghna Group (Fresh), Nestle Bangladesh (Nido), Partex Group (Danish), Abul Khair Group (Marks), Pran Dairy, Brac Dairy (Aarong) and Milk Vita, currently supply milk powder to the markets.
Of the local brands, only Milk Vita and Aarong have their own plants for producing milk powder, while the others only package the imported milk powder and sell it.
The country has a good number of processors that pasteurises milk but there is a lack of powdered milk-making companies and facilities due to a lack of proper infrastructure.
The per-day production capacity of Milk Vita’s only powdered milk factory is 12.5 metric tonnes per day. But the company is now working on setting up another powdered milk factory in Sirajganj to boost production.
In 2015, the Executive Committee of the National Economic Council approved a project to set up the powdered milk factory and it is expected to produce 25 metric tonnes per day.
When asked, Milk Vita Chairman Lipu said the new factory at Baghabari Ghat is almost ready and will be inaugurated very soon.
“I think this factory will help meet the growing demand for powdered milk to some extent,” he added.
