Dairy farm project 8 buffaloes

Project report for eight graded murrah buffaloes dairy farm

Dairy farm project 8 buffaloes is based on following assumptions

1-Freshly calved murrah  female buffaloes in 1st or 2nd lactation will be purchased in two batches of four animals each/batch  at an interval of 5 to 6 months.2-Availability of 2 acres of land  for fodder cultivation is prerequisite for the project,3-Dung produced will be utilized as Manure for fodder cultivation.4-Cost of rearing calves not considered as it will be repealed by their sale value57In case of death of adult animal new buffalo  will be purchased from insurance claim money.6-Heifers will be used as replacement stocks7 The scheme will be successful on the above guidelines if run by the dairy farmer on scientific lines.

Economics of dairy farming with 8 Graded murrah  buffaloes
Project cost and bank loan	Cost. In Rs.
Capital cost
Low cost Shed for 8buffaloes  50sq.ft/Buffalo @150/sqft	60000
Low cost Calf pen for 8 calves 20 sq.ft./calf @150/sq.ft.	24000
Cost of 4 graded murrah buffaloes with minimum average 10 liter milk yield 10 liter /day @52000/buffalo including transportation	416000
Cost of dairy appliances @ 1000/buffalo	8000
Cost of one hand operated chaff cutter	10000
Total	518000
Cost of feed for first batch of  four   buffalo for one month as per feed chart	15400
Cost of insurance  first   animals @5% of animal cost	10400
Cost of fodder cultivation in 2 acres of land for first session	12000
Cost of medicine vaccine, electricity for  first  four  buffaloes	4200
Total recurring expenditure	42000
TOTAL PROJECT COST	560000
Margin money 10% of project cost	56000
Bank loan 90% of project cost	504000

CASH FLOW ANALYSIS
Particulars	Project period
	1	2	3	4	5	6
Feeding during lactation period vide yearly lactation days and feed cost as per chart	223600	192400	239200	218400	218400	239200
Feeding during dry period vide dry days and feed cost as per feed chart enclosed	26400	13800	62400	72000	72000	62400
Medicine vaccine veterinary aid	8000	8000	8000	8000	8000	8000
Insurance @5% of animal cost /year	20800	20800	20800	20800	20800	20800
Cost of fodder cultivation	48000	48000	48000	48000	48000	48000
other miscellaneous expenditure	20000	20000	20000	20000	20000	20000
Total	346800	303000	398400	387200	387200	398400
INCOME
Sale  of milk @Rs.35/liter during lactation days	602000	521500	644000	588000	588000	644000
Sale of gunny bags	1020	1260	1220	1160	1160	1220
Manure will be utilized in own farm
Value of closing stock of  8 buffaloes(Depreciation on animal cost @10%/year)						166400
Value of building (Depreciation on building@10%/year)						33600
Value of equipment (Depreciation on equipment @15%/year)						1400
Total income	603020	522760	645220	589160	589160	603020
Gross profit	256220	219760	246820	201960	201960	448220

Calculation of BCR and IRR
	1	2	3	4	5	6
Capital Costs	518000
Recurring Cost	346800	303000	398400	387200	387200	398400
Total Costs	864800	303000	398400	387200	387200	398400
Benefit	603020	522760	645220	589160	589160	603020
Net Benefit	-261780	219760	246820	201960	201960	204620

Financial indicators	Estimated value	Preferred value
Net Present Worth (NPW	405167.48	Should be+ve
Benefit Cost Ratio(BCR)	1.22:1	>1
Internal Rate of return (IRR)	37.629	>15%
Debt Service Coverage Ratio	2.075	>1.5

Loan Repayment  for  eight graded murrah buffalo:- Repayment of loan will start after grace period of  six months. Total loan repayment period is 6-7 years. Details of  monthly installment, interest payment, principal payment and balance  is given in repayment schedule for  eight graded murrah.