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Harish Damodaran

New Delhi , March 13

DAIRY product exports from the country are poised to cross the Rs 500-crore mark for the first ever time during the current fiscal.

A large chunk of this would come from edible casein, exports of which are alone expected to gross Rs 350 crore. "This has been a very good year for casein exports, as international prices have been ruling high," said Mr Gajinder Kumar, Managing Partner of VRS Foods Ltd.

According to Mr Harsevak Singh, CEO of Mahaan Proteins Ltd, casein exports would touch about 15,000 tonnes during 2004-05. "The average export realisation this year has been around $5,600 per tonne this year free-on-board, as against $4,200 per tonne in 2003-04 and $3,150 per tonne the year before," he noted. At about Rs 240 per kg, the value of exports would be in the region of Rs 360 crore - an all-time high.

Casein is basically a group name for the dominant class of proteins in milk, responsible for its viscosity and white colour. Roughly 82 per cent of the total protein present in milk is constituted by casein, with the remaining 18 per cent being whey proteins. The overall casein content in milk ranges from 3-3.5 per cent.

Besides VRS Foods and Mahaan Proteins (both Delhi-based), there are two other manufacturers of export-grade edible casein in the country - Dynamix Dairy Industries Ltd, at Baramati, and Cepham Milk Specialities Ltd, at Chandigarh.

While VRS Foods alone would export 4,000 tonnes during the current fiscal, the other three are expected to ship roughly 3,500 tonnes each.

Exports of casein and its derivatives started picking up sometime in the mid-1990s, rising from 912 tonnes (Rs 13.22 crore) in 1997-98 to 2,108 t (Rs 53.25 cr) in 1998-99, 4,784 t (Rs 82.67 cr) in 1999-2000 and 8,224 t (Rs 158.55 cr) in 2000-01.

The subsequent years though registered a decline to 6,336 t (Rs 123.74 cr) in 2001-02, 7,373 t (Rs 124.90 cr) in 2002-03 and 4,223 t (Rs 76.83 cr) in 2003-04.

"Last year was bad because the acute milk shortage in the country meant that till November 2003, we could not even operate our plants. This year, not only has domestic milk availability gone up, but also global prices have risen to record levels," Mr Singh pointed out.

Casein prices largely reflect international prices of skimmed milk powder (SMP). These, in turn, are dictated by the `market management' measures of the European Community (EC).

When SMP stocks are high, the EC grants increased aid for production of casein from skimmed milk, so as to encourage the production of an alternative product and thereby, discourage the production of surplus SMP.

"Currently, international SMP prices are above $2,000 per tonne, which automatically reduces production of SMP in European Union," Mr Kumar said.

According to him, most of the casein exported by the country goes for the production of sodium caseinates, used in the food industry for enhancing nutritional as well as functional qualities.

Caseinates are used as binders in sauages and other processed meats and also as emulsifiers, helping fats to stay suspended in water based products such as milkshakes, coffee creamers, and ice creams.

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