Economics of milk marketing and its efficiency in Kalaburagi District of Karnataka

The study was conducted in Kalaburagi district of Karnataka. Totally 60 milk producers and 30 market intermediaries were selected for the study and survey was conducted during 2016–17. The study pronounced that majority of rural and peri-urban farmers have sold milk through unorganized sector (70%) and only 30 per cent of farmers have disposed milk through organized sector. Per litre marketing cost incurred by producers in marketing of milk in rural and periurban area under channel-I was 0.25 and 1.17 respectively. Similarly, milk vendors incurred marketing cost of 3.10 and 3.75 and received a margin of 7.45 and 8.50 in rural and peri-urban dairy farms respectively. Milk vendors were dominant in the unorganized sector and have procured maximum quantity of milk. The vendor exploited the producers by paying lower price for the milk and sold deteriorated quality milk to the consumers at higher price. Producer's share in consumer rupee was high in peri-urban (76.55%) compared to rural (70.70%) dairy farms. The study also showed that the efficiency of the channel was low in which the number of intermediaries were more. There is a need to strengthen the structure of organized milk marketing system in the study area.