A Study On Profitability Factors Of Dairy Industry In Punjab, Pakistan

This study mainly describes about the farm production and management on the selected dairy farms. The main focus of the current research was to evaluate profitability factors of dairy industry in Pakistan. This study reports about the status of dairy industry in selected five districts of Punjab, Pakistan. The study was conducted in years 2013-2015 at Rawalpindi, Faisalabad, Lahore, Sahiwal and Jhang districts of Punjab, Pakistan. The data was recorded randomly by visiting farms individually and processed to calculate percentages for suitable representation. The results showed that farmers with high level of education and training have more productivity. Sixty two percent of farmers had higher secondary and above while most of the farmers had more than five years of experience in the field. Forty seven percent of the farm animals were buffaloes breed Nili Ravi followed by a cow breed Sahiwal(29 %) and crossbreed cows(20 %), while Australian cow breed was only 3 % of the total animals on the farms under study. The 74% of dairy farmers haven’t attended any training in the year 2014-2015. That shows the government negligence towards the dairy sector. 33% of the farms use feeding system A(Fresh and Dry), only 1% dairy farms use B(concentrate and dry) feeding system. The 14% of the farmers feed their animals on feeding system C(dry and pasture) and the remaining 52% farmers use D(fresh, dry and concentrate) feeding system. The farm size was categorized on the basis on of number of animals at each dairy farm. Data collected from large dairy farms regarding percentage of productive animals, average milk production, average milk price and total expenses were subjected to regression and correlation analysis against income. The results showed that all the variables have significant impact on income of large dairy farms except average milk price. In case of medium size dairy farms, same variables were analyzed against income and the results depicted that average milk production and average milk price had a non significant impact on income but percentage of productive animals and total expenses had a significant relationship with income. The data regarding small dairy farms were subjected to regression and correlation analysis against income and the results revealed that all the variables have a significant effect on income.The data regarding number of productive animals, percentage of productive animals, average milk production, average milk price and total expenses were subjected to regression and correlation analysis against income for each district separately. The results depicted that effect of total expenses, average milk production and percentage of productive animals on income was significant but average milk price effect on income was non significant in Rawalpindi district. In Faisalabad district, the effect of total expenses on income was significant whereas the impact of average milk production, average milk price and percentage of productive animals on income was found non significant. In Lahore district, the impact of total expenses and average milk production and percentage of productive animals on income was significant but average milk price effect on income was non significant. The effect of total expenses, average milk production on income was significant while the impact of average milk price and percentage of productive animals on income showed non significant result for Sahiwal district. In Jhang district, the only significant effect was of total expenses on income and the impact of average milk production, average milk price and percentage of productive animals on income was non significant. The benefit and cost analysis for Rawalpindi, Faisalabad, Lahore, Sahiwal and Jhang was 3.78, 3.73, 3.20, 3.42 and 2.50 respectively i.e. highly profitable for all five districts. The results for return on investment for Rawalpindi, Faisalabad, Lahore, Sahiwal and Jhang was 378.14%, 373.47%, 320.27%, 341.95% and 250.20% respectively The output of the study will help for further planning and to improve the dairy sector of Pakistan.