2011

OPENERS Dairy Farm (Pvt.) Ltd.

Md.Monirul Islam, Md. Saiham Ibne Rafi Chowdhury, Adnan Hossain, G.M. Kabir

[PROJECT PROFILE OF THE PROPOSED DAIRY FARM PROJECT]

The dairy farm is a project of livestock sector. This business can be started both in rural and semi-urban areas in sheds. The Dairy sheds can be acquired on rental basis own basis. These sheds have all the required facilities for the proposed farm. The rent cost varies between Tk. 10 to Tk. 15 per square feet per month depending upon the location and facilities at the farm. The milk is sold to traders and the whole sellers markets in the urban areas. Dairy farming is a profitable venture depending on the demand of the milk in the market.

Project Brief
Cattle population in Bangladesh is about 24.13 million (FAO, 1994). In the rural area, cattle are kept mainly for draught purpose. Only a limited number of farmers have cow for milk production. Maximum cattle are no descriptive type, which do not belong to any specific breed and termed as indigenous cattle. These animals are kept mainly in the stall with limited grazing on the roadside, embankment slope; fallow land and paddy straw are their staple food. Husbandry practices and health care of these animals are poor. The average milk production of local cows is very low and it varies between 300 to 400 liters per lactation period of 180 to 240 days. Such low productivity of indigenous cows is an important constraint for future development of the livestock sector. High productive exotic breeds and their crosses normally do not have adequate resistance against the prevalent diseases. They do not thrive well in our environment. In spite of all these problems, some people have shown interest for development of small dairy farms. Generally crossbred cows under village condition yields 600 to 800 liters if milk per lactation of 210 to 240 days. Bangladesh suffers from an acute shortage of livestock products like milk. The domestic demand for milk has been rising faster than the domestic production of milk. Hence Bangladesh Government has given the priority on the development of dairying at farmers level to increase the supply of milk from small dairy farms. The dairy farm is a project of livestock sector. This business can be started both in rural and semi-urban areas in sheds. The Dairy sheds can be acquired on rental basis own basis. These sheds have all the required facilities for the proposed farm. The rent cost varies between Tk. 10 to Tk. 15 per square feet per month depending upon the location and facilities at the farm. The milk is sold to traders and the whole sellers markets in the urban areas. Dairy farming is a profitable venture depending on the demand of the milk in the market.

Rationale
Dairy milk is one of the valuable sources of protein available in the country. Though the time required for raising the cow for milk production is little bit higher but in benefit analysis it is more profitable. The consumption of milk is increasing due to growing health consciousness in the population. According to the Agriculture Statistics of Bangladesh the per capita consumption of dairy milk is increasing at a high rate in Bangladesh per annum. It correlates with the income level of the consumers. A statistics find out by BRAC Bangladesh on the consumption pattern of milk is given below-

The livestock sector generates 20% of full-time employment in Bangladesh. More over it is the predominant source of income generation little research has been done on the profitability of dairy cattle rearing in Bangladesh. A study results indicate that the production cost of milk per litre from both local and crossbreed cows far exceeds its market/selling price. One of the main reasons for high cost of production is the low milk yield per cow (1.5 liters/day for local and 2.5 litres/day for crossbred cows).

Estimated gross costs and benefits earned from dairy farming

Lactation year Total cost (taka) Local (n = 10) Crossbred (n = 10) Gross return (taka) Local (n = 10) Crossbred (n = 10)

1 54524 58179 2 92585 98798 3 117054 124911 Total 264163 281888 Note: US$ 1 = taka 57 at 2001 exchange rate.

4380 148636 173007 326023

4380 247966 297117 549463

Scope Statement
Objectives of the Project: To achieve, by having a dairy cow. These included getting milk for home consumption, Getting money for maintaining their homes; Income generation Buying cow requirements (dairy enterprise self sufficiency), Medical treatment for the family, Improving soil fertility by manure and cow urine and increasing herd value (increasing cattle numbers in the herd). Improvement in milk production of cows. Making available milk animals at most affordable rates. Provide technical knowledge, how in setting up of small and medium Dairy projects. Promotion of Dairying for self employment. To create and maintain disease free status so as to boost marketing of superior Livestock.

Total Project Cost

A dairy farm with a population of 20 cows that is established in rented building needs a capital investment of about Tk. 18 lac for purchasing farm machinery and equipment. In addition to this, a sum of Tk. 132000 is required as working capital, which will be used for purchasing livestock feeds and raw material (vaccines) etc.

Proposed Capacity
A Dairy farm of about 20 cows is considered to be an economically viable size, which will justify fixed and operational costs. In this pre-feasibility study, all the calculations have been based on a flock size of 20 cows, with raising one flock per year. There will be a lag time of two weeks for cleaning and fumigation of the farm.

Resource Requirement
Initial Resources: 1. Land- 1000 square Ft. 2. Civil Works 3. Cows- 20 Unit. 4. Bank Loan- 1500000 BDT 5. 6 Persons (Project Team) Resources during Operation 1. Food 2. Vaccination 3. Favorable environment etc. 4. Manpower- 10 Persons Findings of the Feasibility Study Favorable environment for the project Financial and technical support from the government, bank and the NGOs (i.e.BRAC, Proshika, ASA etc.) Availability of manpower. Treatment and medicine availability. feeding management and quality; reproduction problems and long calving intervals; quality of milk; farm management; Availability of grasses Lack of water Nutritional management Non identification of animal health problems Increase in mastitis incidence No clear price signals Lack of experience and education Long calving intervals

Risks
The Dairy farm has some inherent issues, which cannot be controlled by an individual entrepreneur. Following are some threats faced by this industry: Initial Phase Site selection Site preparation Accommodation Quality of supplied cows Skilled man power lacking Sufficient Funding Source of raw materials

Farming Process Disease Epidemic o Common Diseases of Dairy Cattle Calving Disorders Early Lactation Pitfalls Everyday Problems

Calving Disorders Dystocia Paralysis Prolapsed Uterus Retained Placenta Metritis Milk fever

Solid wastes and odor Food crisis Treatment and medicine Miscellaneous i.e. weather

Work Breakdown Structure

Phase-1 1. Market Analysis 1.1 Survey 1.2 Feasibility Study 1.3 Cost Estimation. o Land 200000 BDT o Civil work- 200000 BDT o Cows- 1200000 BDT o Vaccine- 30000 BDT o Manpower- 24000 BDT o Contingency Cost- 250000 BDT 1.4 Risk Analysis. 2. Resource Requirements estimation 2.1 Land Selection 2.2 Land Acquisition 2.3 Land Preparation 2.4. Civil Work Build up boundary- 1000 square fit Brick- 5000 pcs Sand- 20 packs Cement- 10 packs CI sheet (6ft) - 60 pcs Iron Net Electric wiring Water Supplying system 2.5 Manpower selection 4. Vaccination Veterinary Doctor Selection. Gather Side effect knowledge.

Phase-2 1. Recruitment Educational Qualification- Veterinary Hons Experience- 2 years on this field.

2. Fund collection 3. Cow Procurement 4. Cow settlement 5. Apply manpower Phase-3 Meet the dairy feed Suppliers Marketing Milk to processed milk Industry Signing contract Confirm the delivery date

Project Scheduling

Fig: Gantt chart

Costing and Cash Flow

WBS Task Name Estimated Cost in Tk.

1 2
2.1 2.2 2.2.1. 2.2.2. 2.2

Dairy Farming Project Phase 1

Market Analysis Resource Requirement Estimation Land Selection + Land Acquisition + Land Preparation Civil Work Vaccination Capabilities

1800000.00 375000.00
5000.00 370000.00 150000.00 200000.00 20000.00

3
3.1 3.2 3.3 3.4 3.5

Phase 2
Recruitment Fund Collection cost Cow Procurement Cow Settlement Training of the Staffs

1032000.00
20000.00 1000000.00 2000.00 20000.00

4
4.1 4.2 4.3 Total

Phase 3
Contact with dairy feed suppliers Marketing Milk to processed Industries Contingency

204000.00
1000.00 3000.00 200000 1611000.00

WORKING CAPITAL Description Land Rent Salaries & Wages Description Skilled Unskilled Total Nos 1 3 Sal/Month 8000 3000 Amount TK(2 months) 16000 18000 34000 Amount(TK) for project Time (4 month) 20000

Utilities Description Water Power Total Other Expenses Description Dairy Feeds Postage & Stationery Expenses Transportation Expenses Miscellaneous Expenses Total Amount TK(2 Months) 120000 1000 6000 5000 132000 Unit LS LS Amount TK(2 Months) 1000 2000 3000

Total Project Cost=1800000.00 BDT

Management of Farmhouse Farm input required for a broiler farm includes farm equipment, electronic fixtures and other consumer items (feed, vaccines & medicines, rice-husk or saw-dust, water, electricity, etc.). Feeding management: There were two systems of feeding, which are practiced feed, the cattle. We mainly followed stall-feeding and sometimes grazing system. All calves were fed milk by suckling. The main livestock feed at the study area was rice straw. Most of the time we used untreated straw. Most important constraints regarding fodder cultivation are scarcity of land, scarcity of seed/cutting and lack of knowledge. Breeding system: It was observed that most of the cows were inseminated artificially and sometimes both naturally and artificially which is similar to the observation. For artificial insemination, the majority of the farmers preferred Friesian semen.

Milk yield per lactation: Milk yield per lactation for crossbred is 1210 liters. The difference in milk production between crossbred and indigenous cows was highly significant (P<0.01). Lactation period: The average lactation period for crossbred is 283 Housing The cows should be kept in a clean, dry and well-ventilated room. Dairy house should have proper ventilation as this provides the cows fresh air and carries off moisture. The entire building including litter and all equipment should be fumigated.

Litter Litter is spread on the floor to prevent the direct contact with the floor. Straw, rice husk and sawdust are generally used for making the litter. It should be dry and free of moulds. Caked or moldy material should be removed and refilled with fresh materials. Extensively wet and dusty litter should also not be used. Using new litter for each flock is good for raising disease-free broiler.

Vaccination Vaccination can be provided to chicks through injections, can also be mixed in the water and also through eye drops. Average vaccination price per bird mostly varies between Tk. 2-5. The feasibility has taken cost of vaccination at Tk. 2 per bird.

Fumigation and Spraying It is essential to check all equipment and walls of the broiler house carefully that they are clean, and washed with disinfectant solution, and dried. The rooms should be white washed and sprayed before the arrival of birds. Disinfectant solution can be prepared with Phenol, Potassium Permanganate, Carbolic Acid and Formalin. A solution of Sodium Hydroxide/Caustic Soda with warm water can also be used to clean the house. To sanitize the broiler house from germs and insects, it is fumigated with Formaldehyde Gas, which is produced by putting Formalin on Potassium Permanganate. The rooms should be vacant and sealed for 30 minutes after the fumigation so that the gas infiltrates in every corner of the room. In the pre-feasibility report, the cost of fumigation has been taken as Tk. 1,074 per flock.

Manpower Requirements Skilled workers are needed to look after the feeding, vaccination and cleaning operations at the farm. A single person can handle 5 cows easily. Each attendant is given a monthly salary of Tk. 3000.

Net return and Benefit Cost Ratio (BCR) from dairy cows: Deducting all costs from gross returns arrived at net return from dairy cows. Table reveals that daily net return per dairy cow was Tk. 120 and Cost Benefits Ratio of dairy enterprises, which is on an average 1: 1.26.
Condition (per cow) Feed Utility cost Milk out put Balance

Quantity (Per cow) -

Amount (TK) per day 100 60 280 120

7 litr -

Farm Equipments Various types of farm equipment are needed for feeding, drinking and handling the birds. List of farm equipment, which will be needed, is as under: Cow Water Bowl, CIP Cleaning System, Steel Milking Bucket, Steel Milk Cup, Bucket Of Storing, Suitable Locations Suburban and rural areas around the major cities of the country are the suitable areas for setting up a poultry farm. Setting up a farm at a rural place will minimize the risk of disease. Proximity of the farm to the city enables the farmer to have a quick communication with the market for the purchase of feeds, farm inputs (feed, etc.), and selling of milk.

Infrastructure Requirements Dairy farming needs to be handled tactically, right from the selection of the site to the final stage when the milk is sold. The farm should be located at a place where transportation of different materials and feed can be handled easily. The entrepreneur should make sure that the following things are available at the farm site before setting up the farm: Electricity connection Drinking quality water

Project Closure
By the start of 2012 project will be closed. To make ensure the project closure we need some documents and also archiving them: Which area) Final Report. b) Nutritional Assessment Report. c) Project Handover Report. d) Stakeholder List e) Lesson learned Document and archiving system. f) Photograph of all activities as well as project closure celebration report. g) Community people and stakeholders meeting report.