Chairman Speech - 50th Annual General Body Meeting

CHAIRMAN'S SPEECH

Ladies and gentlemen,

It is with great pleasure and honor that I stand before you today in this Golden Jubilee year of Gujarat Co-operative Milk Marketing Federation Ltd. (GCMMF), to present to you the annual report. Founded in 1973 with the vision to strengthen the cooperative model of Gujarat, GCMMF has been working not only as an apex body, but also as a pivot in multiplying the efforts that each Dairy Cooperative has relentlessly put in at their respective districts. Starting the journey with just 6 MUs and a turnover of 49 Crores, today, we have within Gujarat 18 Member Unions, collecting more than 3 Crores Liters of milk per day and having an unduplicated turnover of Rs. 80,000 Crores (USD 10 Billion).

In the last 50 years, we have been successful in standing true to the principle of being a bridge between farmers and the consumers, by being innovative in our marketing and distribution efforts and developing new products catering to the evolving demands of the customer.

The vision with which GCMMF was set up by our 6 founding fathers – Shri Tribhuvandas Patel, Shri Motibhai Chaudhari, Shri Galbabhai Patel, Shri Bhurabhai Patel, Shri Jagajivandas Patel, Shri Jashwantlal Shah & Dr. Verghese Kurien made Amul the most loved brand by every Indian across generations. The Amul model of dairy development has also made India proud across the world in creating a commercially self-sustainable (Atmanirbhar) model for the socio-economic development of the dairy farmer. Today, we can proudly say that the dairy farmers of Gujarat have created a model that few can dream of, a brand truly owned by 36 lacs dairy farmers.

Beyond capturing market share or competing with established FMCG behemoths, we believe that it is the farmers’ interest that we have consistently put forward. We have maximised returns on milk supplied by the farmers and provide incentives for better quality of milk. We continue to pay our farmers the highest realization of the consumer’s price viz. for every Rs. 100 a consumer spends on Amul products, Rs. 80-85 goes back to the dairy farmer.

GOLDEN JUBILEE CELEBRATION

On 22nd February 2024, the Hon’ble Prime Minister of India, Shri Narendra Modi graced the occasion as the Chief Guest of the Golden Jubilee Celebration of Gujarat Cooperative Milk Marketing Federation Limited (GCMMF), held at Narendra Modi Stadium, Ahmedabad in the presence of One Lacs dairy farmers of Gujarat.

The event was also attended by Hon’ble Governor of Gujarat, Shri Acharya Devvrat; Hon’ble Chief Minister of Gujarat, Shri Bhupendrabhai Patel; Shri CR Patil (BJP President, Gujarat), Shri Shankarbhai Chaudhary, Speaker, Gujarat Legislative Assembly, Shri Jethabhai Aahir (Bharwad), Deputy Speaker, Gujarat Legislative Assembly, Shri Shamalbhai Patel, Chairman, GCMMF, Shri Valamji Humbal, Vice Chairman, GCMMF along with the board of directors of GCMMF.

The Hon’ble Prime Minister spoke very highly of GCMMF and its accomplishment over the last 50 years. He said, "The sapling that was collectively planted by the villages of Gujarat 50 years ago has now grown into a magnificent banyan tree. Today, the branches of this colossal banyan tree have extended across the nation and abroad. I extend my heartfelt congratulations to all of you on the golden jubilee of the Gujarat Co-operative Milk Marketing Federation. I also commend every individual, both men and women, who are associated with the milk committees of Gujarat.”

He also praised the brand by stating, "Since Bharat’s independence, numerous brands have emerged in the country, but none quite like Amul. – ‘अमूल जैसा कोई नहीं’. Today, Amul stands as a symbol of Bharat’s cattle rearers’ resilience and strength. Amul embodies trust, progress, public participation, and the empowerment of farmers. It epitomizes the fusion of modernity with tradition, serving as an inspiration for a self-reliant Bharat, characterized by lofty aspirations, resolutions, and remarkable achievements. Amul’s products are now exported to over 50 countries worldwide. With a network comprising more than 18 thousand milk cooperative groups, over 36 lacs farmers, and 3.5 crore liters of milk collected daily, alongside online payments exceeding Rs 200 crore to cattle rearers each day, Amul’s scale of operation is truly formidable. This organization of small-scale livestock rearers thrives on the power of organization and cooperation.”

The last 50 years of GCMMF has been an inspirational journey marked with numerous achievements in the timeline.

• Amul is India’s largest food brand FMCG brand
• Amul is the strongest dairy brand in the world (Brand Finance Food & Drink Report, 2023)
• Amul is the 2nd strongest food brand in the world (Brand Finance Food & Drink Report, 2023)
• Amul Girl Topical campaign is the world’s longest running campaign in the world.
• 22 billion packs of various Amul milk and milk products are purchased in a year, making it the largest brand picked up by consumers in the world.
• Amul is the world’s 8th largest dairy processor with a capacity of 50 million liters of milk per day. (IFCN Dairy Report 2019)
• Amul distributes over 1,050+ products across the length and breadth of India with its network of 86 branches, 15,000 distributors and 10 lacs retailers.
• ‘Manthan’, India’s largest crowdfunded film was produced by collecting Rs 2 from 5 Lacs farmers and it won the national award in 1977 was official entry to Academy Awards (the Oscars).
• Milk procurement increased from 6 Lacs Liters Per Day (LLPD) in 1973 to 300 LLPD in 2023 with a CAGR of 36.5%.
• We also increased our farmer producers from 4 lacs in 1973 to 36 lacs in 2023 and the per capita milk production per farmer from 2 liters in 1973 to 9.7 liters in 2023, thus increasing the income and improving their livelihood.
• GCMMF (Amul) with 36 lacs farmers as its owner, is the world’s largest farmer owned dairy co-operative.
• Amul is India’s largest dairy exporter with its products reaching 50+ countries.
• Amul is the largest probiotic brand in the world with daily sales of more than 30 lacs liters of probiotic buttermilk.
• Every morning Amul milk is distributed in all the climatic conditions from snow-clad towns of Jammu & Kashmir to the deserts of Jaisalmer, from the hills of Shillong and to the tropical coasts of Vishakhapatnam.

Most importantly, Amul is India’s most trusted brand. We have earned this trust for the last 50 years and we work every day to ensure we sustain the love and affection shared by more than 4 generations of customers.

World Milk Production Situation:

The global milk production landscape has witnessed significant changes in recent years. Milk remains an essential part of the human diet, and its demand continues to grow. According to recent data by FAO, global milk production in 2023 is likely to reach 950 million tonnes, an increase of 1.3 percent year-on-year, a faster pace compared to the 0.6 percent growth registered in 2022, principally driven by volume growth in Asia, specifically in India and China, with moderate growth in the rest of the world and potentially lower production in Africa. This growth can be attributed to the increasing population, rising per capita income, and changing dietary patterns across various regions. World milk production is projected to grow at 1.6% p.a. to 1100 MT by 2033 while India currently contributes 24% of the world milk production it will become 30% by 2033.

India's Milk Production Situation:

India, being the largest milk-producing country in the world, has made substantial contributions to this global trend. Our country has a rich heritage of dairy farming, and it has consistently registered impressive growth in milk production. As per FAO, in India, milk production is expected to reach 232 million tonnes, increasing by 4.5 percent from 2022, induced by rising dairy herd numbers and more efficient milk collections by dairy cooperatives. The contribution of dairy to India’s GDP is more than the combined contribution of wheat, cereals and pulses combined. This achievement is a testament to the efforts and dedication of our dairy farmers, who have embraced modern dairy farming techniques, adopted scientific breeding practices, and received support from organizations like GCMMF.

The Hon. Prime Minister, Shri Narendra Modi and Hon’ble Minister for Home and Cooperation, Shri Amit Shah have envisioned the need for White Revolution 2.0 based on the Amul model, to set up 2 lac primary milk production societies to empower millions of farmers across the country. This initiative will enable India to provide nourishment to billions of consumers across the world and protect the future of our dairy farmers.

The success of the Amul Model is being taken globally and GCMMF in partnership with NDDB is working to set up the dairy industry in Sri Lanka and Kenya under the leadership of the Government of India.

Women Power – The Backbone of Cooperatives

The milk cooperatives of Gujarat have a unique feature that sets them apart from other cooperatives in India. Women have been the backbone of these cooperatives, playing an instrumental role in their success. The cooperative model has empowered women by providing them with a platform to participate in decision-making, access to training, and a steady source of income.

Recently the W20 event, as part of G20, was organized by GCMMF as lead organizer in Anand along with NDDB and DAHD on 20 July 2023, with the theme Jan Bhagidari - celebrated the contribution of women led sustainable development through dairy cooperatives.

This event helped to demonstrate to various countries across the globe, the journey of success of AMUL and India’s dairy development, which is complete only with the contribution of millions of women dairy farmers, who have made India proud as the largest producer of milk in the world.

Future Trends in the Dairy Industry:

As we look ahead, it is essential to recognize the emerging trends in the dairy industry and position ourselves to leverage these opportunities. The future of the dairy industry is driven by changing consumer preferences, technological advancements, and sustainable practices. Here are a few key trends that we anticipate:

1. Health and Wellness: There is a growing demand for healthier dairy products, including high protein, low-fat, and lactose-free options. We have launched High Protein Milk, High Protein Whey concentrate in plain and chocolate flavor, High Protein Paneer in addition to the High Protein Buttermilk, High Protein Lassi, Lactose Free Sweets, Sugar Free Cookies, Ice Creams, Flavored Milk and Lassi which have been received well by our consumers. We are committed to meeting these evolving consumer needs by expanding our product portfolio and will continue to invest in its research and development.

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   • Our cattle have been consuming dry fodder which, if left unused, would have been burnt and caused pollution.
   • By using the cow dung, we have converted it into biogas thus reducing usage of firewood in cooking in villages as well as ensuring energy consumption is controlled within the household of the farmer.
   • The dry and wet slurry can be used as fertilizers which can help reduce the dependency of farmers to buy chemical fertilizers. It will make our farmlands naturally organic.
   • The biogas generated in our villages can be used as cooking gas, for generating electricity and as BioCNG for vehicles.
   • The macro benefit for the nation would be in saving foreign exchange to buy chemical fertilizers and petroleum and in the process gain a cleaner environment and organic fruits and vegetables.
2. Circular Economy: In India, we have created a circular economy in each village wherein the cow has become a solution rather than a problem to control the ills of greenhouse gas emission and protect our environment.

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   • The farmer app provides information related to the milk poured and the payment transferred to their bank accounts and acts as a marketplace for online cattle trading without intermediary intervention.
   • For our consumers we have developed ‘Locate Amul’ which provides information related to availability of our products in their nearest stores.
   • Amul Dairy Trade helps in the sale of commodity products to B2B customers, this has created a transparent system which facilitates market price discovery.
   • • Lastly, we started our D2C platform (https://shop.amul.com/) through which we sell a range of dairy products directly to our customers.
3. Digital Transformation: Technology is revolutionizing every industry, and the dairy sector is no exception. We are embracing digital solutions to enhance our operational efficiency, optimize supply chain management, and improve traceability throughout the value chain.

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   • We launched our Velvett Milk Chocolate in India; it has been very well received by our consumers. We are also doubling our chocolate manufacturing capacity this year in view of increasing demand for Amul chocolates.
   • Amul Ice cream, launched in 1996 with a small processing capacity of 4000 Liters per day, has grown to be the market leader in the ice cream category with a peak processing of 15 Lac liters per day as on date. As GCMMF is celebrating its Golden Jubilee this year, we stand strong with 25 ice cream processing plants across the country with plants put up recently in Mumbai, Varanasi, Ujjain, Bhuj, Surendranagar by various member unions.
   • More than 2500 Scooping parlors have been opened where customers enjoy scoops, sundaes, shakes etc. To provide premium indulgent experience to customers, we have opened 15 Amul Ice lounge to serve exotic Flavors to the World ice creams and plan to open 100 Ice lounge in coming year.
4. Value-Added Products: The demand for milk and value-added dairy products, such as cheese, butter, ghee, milk powders, curd, paneer, and ice cream, continues to grow.

We will continue to invest in expanding our product range and production capacities to meet future demands and strengthen our presence in domestic and international markets.

5. Domestic Expansion: The growing population of India along with its increasing per capita income will be the impetus for our organization’s growth in the coming years. Our focus on increasing our presence in the top 200 populated towns is delivering results. We have planned to increase our branches from 86 to 100 in India, along with distribution centers for the Fresh, Ambient, Refrigerated and Frozen category of products.

6. International Expansion: The global dairy market offers significant growth potential. We have successfully launched Fresh Milk in the USA in collaboration with Michigan Milk Marketing Association – a 108-year-old USA based co-operative society. We intend to take the Amul brand globally into various countries of the world. With a focus on Top 200 cities of the world, our team will ensure we can expand our presence and reach to every Indian across the world. We are presently present in 50+ countries and are exploring opportunities to expand our presence in strategic markets and forge strategic partnerships.

7. Diversification into a Food FMCG: As a farmer organization, we envision bringing every agricultural produce of our farmers into the kitchens of our consumers through a variety of products. The categories range from organic aata, rice and pulses, chocolates, breads, rusks, cookies, ready-to-cook dairy and potato-based snacks, and honey.

We are constantly preparing for every opportunity and challenge that may come our way and with our robust and agile systems and processes we will ensure that we reach out to our customers across the world and reach the target of Rs. 1 lacs crores turnover in coming two years.

In conclusion, I am proud to say that GCMMF has achieved remarkable milestones in the past year and will continue to strive to greater heights while providing the best quality products to our customers and highest remuneration to our dairy farmers.

Thank you

For and on behalf of the Board of Directors,

Shamalbhai B. Patel
Chairman

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