Addressing the Impact of COVID-19 on Dairy Value Chains : Evidence from Punjab, India

The COVID-19 pandemic has adversely affected dairy farmers with the demand shrinking due to income losses of the consumers, disruptions in the supply chains reducing supply, raising costs and increasing wastage. The present study examined such disruptions in Punjab, India, with the primary survey covering dairy farmers, intermediaries, consumers and other stakeholders in the dairy industry. The results reveal a significant fall in farmgate milk prices, disruption in transporting milk within the supply chains, labour shortages, rise in production costs and lack of operating capital. The demand for milk and milk products declined sharply during the pandemic. To dispose of the excess milk supply, dairy farmers turned to localized value chains catering directly to consumer households. Approximately half of the farmers lost almost one-third of their income from processed milk products like ghee and butter. The dairy farmers agreed to strengthen the dairy value chains through better integration of the stakeholders. The inability of the farmers to quickly shift to digital platforms for sales of milk and milk products during the pandemic calls for special capacity-building efforts.