In that context, the company has signed a memorandum of understanding (MoU) with the State Bank of India (SBI) under which the farmers will get the loan at an interest rate of 8.9% per annum.
B Sreekumar, KFL managing director, told FeedNavigator: "Loans will be given through the bank on the recommendations of dairy [cooperatives]; Kerala Feed will only act as a facilitator in this. Priority will be given to farmers affected by floods, though loans will be given across the state."
Once this program is implemented, feed consumption in the state should increase from 8% to 10%, he said.
“On our part, Kerala Feed will also provide subsidies on animal feed to farmers, who will be given the loan.”
In terms of increasing feed consumption in the state, KFL is also building a new feed plant with a capacity of 300 tons per day (TPD) in Calicut, with an investment of $8.56m. That facility will be operational in the next three months.
The local government will soon pass the Feed Act, the aim of which is to ensure the quality of feed sold and distributed in the state, said Sreekumar.
The per capita income of Kerala, which is located in Southern India, is higher than the per capita national income. Kerala has the lowest population growth rate in India, the highest literacy rate of 94% and the highest life expectancy of 77 years.
Sources: Economic Review 2015, Annual Plan 2015-16, Media Reports, Govt. of Kerala website
Animal feed manufacturing in the state of Kerala is currently evolving from a fragmented industry into an organized sector. The feed manufacturers are increasingly using modern and sophisticated methods in an effort to incorporate best international practice.
The introduction of high yield cattle requires specialized feeds so the concept of branded animal feed is starting to gain traction in rural India.
Kerala Co-operative Milk Marketing Federation Ltd (MILMA) comprises a number of dairy co-operative members that sell around 1.3m liters per day (MLPD) – some 1.1m MLPD is produced by them, while the shortfall is met through outsourcing of milk from neighboring states.
According to the 2012 Livestock Census, the bovine population in Kerala was 1.43m, of which 87% are crossbreds and exotic cows, 5% are indigenous cows and the remaining are buffaloes.
The demand for feed and fodder in the state has increased, as body weights of crossbred dairy animals in the state have improved considerably to reach a range of between 325kg and 350 kg.
Source: Dairying in Kerala, a statistical profile 2016
Cattle feed is a segment of the animal feed industry with potential for growth, given that India is the world's leading producer of milk, and production is expected to grow at a compound annual growth rate (CAGR) of 4%, according to a report.
That study shows how Kerala currently meets 40% of its green and dry fodder requirement for its dairy industry from existing agricultural practices.
The Kerala authorities are also focusing on boosting fodder and feed production to support the development of the livestock sector and bridge the gap in the demand and supply of feed and fodder. An additional 3,174 hectares have been brought under green fodder cultivation to increase supplies.
Meanwhile, the Kerala Veterinary and Animal Sciences University (KVASU) recently launched a precision farming project to increase labor and feed efficiency in dairying as well.