Costs and Returns of Milk Production in Nizamabad District of Telangana State: An Empirical Economic Analysis

@article{1722495,
      author = {Dr. Y. Venu Prasad},
      title = {Costs and Returns of Milk Production in Nizamabad District of Telangana State: An Empirical Economic Analysis},
      journal = {Iconic Research And Engineering Journals},
      year = {2025},
      volume = {9},
      number = {1},
      pages = {2244-2250},
      issn = {2456-8880},
      url = {https://www.irejournals.com/formatedpaper/1722495.pdf},
      abstract = {Dairy farming serves as a cornerstone of rural livelihoods in India, providing income security and cushioning agrarian households against crop volatility. This study examines the economics of milk production across small, medium, and large dairy farms in the Nizamabad district of Telangana State. Utilizing primary cross-sectional data collected through a multistage stratified sampling design (N=300), the research evaluates cost structures, lactation yields, input–output relationships, and disposal channels for cows and buffaloes. The empirical findings reveal an average daily maintenance cost of ₹48.45 per cow and ₹59.56 per buffalo, with annual maintenance costs per milch animal settling at ₹17,685.29 and ₹21,739.73, respectively. Feed and fodder constituted the single largest cost component, accounting for nearly 84% of total variable maintenance expenditures (dry fodder ~39.7%, green fodder ~20.0%, and concentrate ~24.5%). The unit cost of milk production averaged ₹12.77 per litre for cows and ₹14.70 per litre for buffaloes. Average lactation yields stood at 1,560.64 litres for cows and 1,684.43 litres for buffaloes, with larger herds demonstrating significant economies of scale through lower unit costs (₹11.09/litre for cows and ₹13.48/litre for buffaloes) and higher productivity (1,811.68 litres and 1,860.82 litres). Daily net returns averaged ₹105.21 per cow and ₹161.01 per buffalo, culminating in favorable input–output ratios of 1:3.17 and 1:3.70 at the aggregate level. Disposal patterns indicate that 75.00% of fluid milk entered the marketed surplus, with direct-to-consumer and private unorganized channels handling the majority of sales. The paper concludes with targeted policy measures focusing on subsidized community fodder banks, decentralized veterinary care, and the consolidation of dairy Farmer Producer Organizations (FPOs) to enhance smallholder competitiveness.},
      keywords = {dairy economics, production cost, lactation yield, input–output ratio, net returns, nizamabad district, telangana.},
      month = {July},
  }