Sep 18, 2012, updated September 2012
To manage the fragmented milk-supply chain in India effectively, Nestlé Agricultural Services used experience gained in other parts of the world to establish a system of direct and efficient contact with the farmers in Moga, Punjab.
The system employs veterinarians and agronomists to supervise milk routes and provide female dairy farmers with advice on various issues, irrespective of whether or not they are Nestlé suppliers. There is no charge for veterinary services, while medicines are provided at wholesale cost. These costs are adjusted against subsequent milk payments to the farmers, making them affordable. We also support farmers in growing their operations, for example we assist with artificial insemination programmes for their cattle, subsidise the purchase of milking machines and help them to procure loans.
During the past few years we have invested approximately Rs. 500 million (USD 10.8 million) in Moga to install cooling tanks and chilling centres, to preserve the quality and nutritional value of milk, provide veterinary aid, promote breed improvement, assist in dairy development projects and other related activities. We have also invested around Rs. 300 million (USD 6.5 million) in procuring goods on behalf of farmers, to be supplied at wholesale prices.
Value to Society
In addition to our direct support for farmers, we are continuously implementing initiatives to improve quality of life in the communities around our factories in India, including the provision of clean water sources at all village schools and nutrition education for teenage girls.
Value to Nestlé
The system used in Moga enables us to purchase more and better quality milk directly from hundreds of thousands of farmers.
As a result, we have been able to improve the nutritional value of not only our products but also that of the milk available in the region, and have brought increased income to the area’s dairy farming communities.