Uttar Pradesh Dairy Cold Chain Innovations for Premium Products

Introduction

The premiumisation of dairy products in Uttar Pradesh is going at a rapid pace. As a result of this, value-added categories such as paneer, probiotic curd, flavoured milk and regional sweets are growing and processors are forced to increase their temperature-controlled infrastructure across the state. With the national cold chain market growing steadily, Uttar Pradesh is also moving at a fast pace to facilitate the deployment of compact chilling units in procurement clusters mainly in districts of Western and Central regions where there is a high density of milk. The demand from urban areas like Lucknow, Kanpur, Noida and Ghaziabad has led cooperatives and private dairies to install plug and play refrigeration at village collection points, introduce insulated cans and refrigerate more milk in trucks. There are new business models where transporters lease cooling equipment to processors or operate on trip-based refrigeration contracts. This change is lessening the bacterial load, cutting down the spoilage, and making supply of premium dairy products easier in the state.

Access the complete dairy cold chain analysis from the Uttar Pradesh Dairy Market Report to identify infrastructure gaps, investment hotspots and logistics opportunities.

Current investments and industry behavior

Processors and logistics firms are collectively investing in block-level micro chilling clusters that will help them achieve two goals simultaneously, namely reduction of milk spoilage and utilization of the time window of two to four hours between collection and processing. In addition to that, they do so by energy-efficient compressors and some by solar-assisted cold rooms solutions. These tactics act as a perfect solution to grid problems and also lowers operating costs. An appropriate example can be seen in the case of WWF India, which dispatched a solar-powered instant milk chiller of around 1500 litres capacity to Jaunpur district, Uttar Pradesh, thus enabling village-level centers to chill raw milk on spot without the need for diesel engines. Industry reports also suggest that more investment is going into cold storage and reefer fleets with specialist cold chain companies, targeting dairy contracts as procurement volumes and premium products supply lines expand across the state.

Demand side drivers

The main reason for the increase in refrigerated last-mile capacity is the rising demand for chilled paneer, yoghurt, and ready-to-drink dairy beverages in urban and semi-urban retail. Institutional buyers and modern retailers are the most demanding in this regard since they need continuous temperature control along with traceability and time-bound delivery guarantees. Larger buyers are making digital temperature logging and visibility tools mandatory for their suppliers.

Rural collection challenges

Rural collection continues to be the most challenging area for the key players in the market. A lot of village level collection points still do not have proper chilling facilities or backup power which makes early morning pickup schedules very much dependent on the weather during hot days. Operators have taken steps in this direction by installing electrified bulk coolers with battery backup and they also plan pay-per-use models so that farmers with smaller holdings can have access to chilling without making a large upfront investment.

Operational innovations

Route optimization along with dynamic scheduling tools help in reducing delivery distance and thus, fuel consumption by the reefer fleet. Software vendors and logistics integrators promote multi-stop route planners that are especially designed for dairy rounds. Besides that, NDDB and other development agencies are also engaged in providing toolkits for route optimization that cooperatives can employ for better utilization of fleets and less transit time.

Outlook and opportunities

As the market for packaged dairy is getting more and more popular in second and third-tier retail centers throughout Uttar Pradesh, the expansion of the cold chain is definitely yielding commercial benefits by not only lessening spoilage but also by maintaining the taste, texture, and shelf life. Retailers from cities like Meerut, Gorakhpur and Bareilly are looking forward to better temperature control of the products such as probiotic curd, flavoured milk and regional dairy sweets which in turn motivates processors to invest in upgrading their chilling, storage and transport assets.

Those companies that are able to create a dense network of rural chilling while at the same time providing reliable refrigerated transport supported by renewable energy systems will be able to capture most of the value. It is expected that public–private partnerships, supported by viability gap funding windows and dedicated cold chain credit lines, will accelerate capacity creation in the most critical procurement zones.

Table of Contents

1. Introduction
2. Definition and scope
3. Chilling node geography
4. Reefer transport and last mile logistics
5. Energy and sustainability interventions
6. Rural collection and micro chilling solutions
7. Technology and visibility tools
8. Outlook and opportunities

Related Resources

India Cold Chain Market Report

India Dairy Market