Milk Processing Plant
ProjectEhsan is presently limited to the concept of developing Milk Processing plant in Bangladesh. So far it has acquired 1.43 acre of land suitable for a milk processing plant; additional 1.5 acre of adjacent land are under process for change of ownership to projectEhsan.
In 1990, all the milk-processors in Bangladesh processed only one percent of entire milk production; 1.5 million metric tones, or 33,000 litres per day. By 2006, the volume processed increased to 384,000 litres per day; only seven percent of milk domestically produced. This lack of processed-milk for general consumption leaves great opportunity to promote best form of protein to citizens of all ages; milk protein contains all the essential amino acids required by the body for optimum growth of babies, at the same time provides calcium and other vitamins needed to sustain a healthy life by adults.
The Project Profile presented herewith proposes the establishment of a milk processing plant to:
(a) Create a supply chain of milk from smallholder-milk-producers (“SMP”);
(b) Produce consumable milk in various flavour and fat-contents;
(c) Produce milk products (butter milk, half & half, whipping cream, butter, ghee, cheese, curd, matha etc.) for commercial consumers;
In 2006 the livestock sector contributed 2.95 percent of GDP, or about 17.5 percent of agricultural GDP. When the indirect benefits of draught power and manure for fuel and fertiliser are added to the direct economic output of meat, milk, and hides, the value added of the livestock sub-sector almost doubles to about six percent of GDP. Livestock also provide critical cash reserve and steady cash income for many marginal farmers who grow crops essentially for subsistence, or who have little or no land at all.
The national herd comprises: 22.80 million cattle, 1.16 million buffaloes, 19.94 goats and 2.57 million sheep. Milk production was 2.27 million metric tonnes (mt) in 2006, mainly produced by cows yielding, on average, 200 to 300 litres per 160/180 day lactation. In the few specialized areas where cross breeding has taken place, yields range from 1,000 to 3,000 litres over a 210/300 day lactation. Until quite recently milk was a by-product of cattle, used largely for making traditional sweets and in tea. Per capita milk availability currently ranges from 40 to 50 g/day (14 to 18 kg/year). The gap between supply and demand is largely met by milk powder imports of about 20,000 mt annually valued at some USD 70 million. Imports represent 0.16 million mt of liquid milk equivalent annually, about 6 to 7 percent of total consumption. While there is no specific nutritional target in the country for milk consumption, the figure of 250 g/day (90 kg/year) is often quoted in national plans, implying an annual milk requirement of 12.8 million mt, more than five times current production.
Smallholder milk producers (“SMP”) play a key role in dairy markets in Bangladesh. SMP is made up of person or household, often landless, engaged in milk production for economic return with surplus milk, usually owning up to three cows. Smallholder Dairy Farmer, on the other hand, is a milk producer linked to milk processors through cooperatives or associations, or individually by milk traders-middlemen. Initially they start with one animal but have potential to grow. Many households have graduated out of poverty and now have twenty of more milk animals. They supply all the domestic milk for the informal or traditional market and three quarters for the formal or processed market. Informal Market is the market near to producer locations where producers directly, or through traders collecting milk from farmers’ homesteads, sell milk to consumers or middlemen suppliers of sweetmeat shops, bakeries or against other trading contracts. Formal Market is the guaranteed market for smallholder milk producers where regular processed milk and milk dairy products supply take place to end-consumers, including institutional buyers such as hotels, restaurants, airline-kitchens, superstores etc.
Unlike SMP, private dairies, some owned by NGOs (e.g., BRAC: Bangladesh Rural Advancement Committee) usually operate through milk supplier-middlemen (Ghoshes or Dudhwalas) in place of rural groups or cooperatives. They collect milk for the assigned dairy and smallholders involved in the system do not receive any value-addition benefit, just the basic price for their milk.
The first dairy plant was set up in 1946 by the National Nutrients Company of the-then Indian subcontinent at Lahirmonhanpur, now in Sirajganj District. Following the partition of India in 1947 the Eastern Milk Products Company took over through exchange of properties. Milk and dairy products marketing eventually started in 1952 under the brand name Milk Vita in the then East Pakistan. Fortuitously, the turn-around at Milk Vita, in the early 1990s, coincided with a growing market for processed milk as urbanisation accelerated. This encouraged other investors to adopt parts of the Milk Vita smallholder dairying model. In 1990 processors collected just one percent of total milk production of 1.5 million mt (30,000 litres per day); by 2006 this had increased to seven percent of 2.27 million mt (384,000 lpd).
Based on various studies conducted by a number of organizations, total amount of un-processd milk available for general and commercial consumption was 2.43 million metric tonnes (mmt) in 2007. About 93% of this amount was available through the local sources. Rural household, made up by 80% of country’s 140 million population, consumed majority of the milk available; about 1.35 mmt. Urban consumers consumed 0.38 mmt; this portion was made up of condensed milk from imported powdered milk, processed milk from suppliers, co-operatives or urban producers
CNG DISTRIBUTION NETWORK IN BANGLADESH
Although Bangladesh has no known reserve of crude oil, it has discovered thus far in excess of 100-year supply of Natural Gas (NG). So far NG supply is limited in areas with fixed gas-transmission pipeline. The goal of this company is to offers a “mother-daughter” concept whereby compressed NG (CNG) can be sold both outside and within such an area. This goal will be achieved by a specially designed NG transport vehicle with storage capability designed to transport CNG outside the fixed gas-transmission pipeline. As of today, there is no such CNG distribution network in Bangladesh. There is an opportunity to serve a wide open market with potential end-users with CNG (vehicles, small to medium industries) as opposed to more expensive diesel and heavy oil as their source of energy.
Some of the strongest advantages are: (1) With less than 20% of the vehicle-fleet converted to NG engines, the demand for NG for the rest of the vehicle-fleet in Bangladesh is significant; (2) Substantial savings to end-users: a cubic meter of NG is sold for Tk. 16.75/m3 (US $0.24); a comparable amount of gasoline cost about 5 times more; (3) NG is more responsible and eco-friendly than gasoline or diesel and easier on mechanical engines; (4) Positive impact on the national economy: for example, during the third quarter of 2008, the Government lost 20 billion taka (US $285 million) in subsidizing imported crude oil.
The executive team that will manage the business in Bangladesh is consist of: (1) Chairman: U.S. Attorney with experience in business operations and has invested in NG sector previously; (2) CFO: MBA from UK with experience in finance and administration; and (3) COO: Bachelor Degree from USA in Industrial Technology and Computer Science, with extensive experience in industrial installation and operation in NG sector.