🧊Bulk Milk Cooling Units — NABARD Model Bankable Project
NABARD model covers two BMC unit sizes: 2,000-litre (₹11.78 lakh, BCR 1.07, IRR 25.57%) and 5,000-litre (₹17.24 lakh, BCR 1.09, IRR 36.57%). Covers cold-chain infrastructure, milk quality standards, and 8–9 year repayment for IBPS AFO and NABARD Grade A.
Bulk Milk Cooling (BMC) units are critical cold-chain infrastructure. As per Codex Alimentarius, milk must be cooled to 4°C immediately after milking — without cooling, milk spoils within 3–4 hours in hot Indian conditions. BMC units allow collection centre-level chilling, enabling alternate-day transportation and significant cost savings.
- India: 1st in world milk production with 19% of global output
- Milk production 2015-16: 155.5 million tonnes
- BMC cooling target: 4°C (within 3 hours from 35°C)
Project Overview
NABARD covers two model sizes: 2,000-litre and 5,000-litre BMC units. Both models operate by chilling milk at the collection centre itself, then transporting to the main dairy less frequently. Income comes from chilling charges (₹1.30/litre from milk union) plus savings on spoilage, spillage, can costs, and transport.
The project assumes no civil cost — installation is in existing collection centre space. About 800–1,200 sq ft of constructed area is sufficient.
Financial Structure
| Component | 2,000-litre | 5,000-litre |
|---|---|---|
| Bulk milk cooler with accessories | ₹5.30 lakh | ₹8.90 lakh |
| Generator, weighing, AMCU, installation etc. | ₹6.48 lakh | ₹8.34 lakh |
| Total Cost | ₹11.78 lakh | ₹17.24 lakh |
| Margin Money (20%) | ₹2.36 lakh | ₹3.45 lakh |
| Bank Loan (80%) | ₹9.42 lakh | ₹13.79 lakh |
NOTE
BMC margin money is 20% — between AMCU (25%) and hydroponics (0%). The 80% bank loan reflects the infrastructure nature of the project where the cooler is permanent capital equipment.
Technical Parameters
| Parameter | 2,000-litre | 5,000-litre |
|---|---|---|
| Capacity utilisation (Year 1, 6 months) | 60% | 60% |
| Capacity utilisation (Year 4+) | 90% | 90% |
| Chilling charge from union | ₹1.30/litre | ₹1.30/litre |
| Saving on spoilage/curdling (1% of milk) | ₹7/litre | ₹7/litre |
| Milk transportation cost to BMCU | ₹0.65/litre | ₹0.65/litre |
| Power and fuel | ₹0.35/litre | ₹0.40/litre |
| Depreciation | 10% | 10% |
| Interest rate | 12% per annum | 12% per annum |
| Repayment period | 9 years | 8 years |
NOTE
The 2,000-litre model has a longer repayment period (9 years) than the 5,000-litre model (8 years) because of lower income per unit investment — larger units achieve better economies of scale.
Income & Financial Analysis
Stabilised annual income (Year 4+):
| Income Head | 2,000-litre | 5,000-litre |
|---|---|---|
| Chilling charges (₹1.30/litre) | ₹8.54 lakh | ₹21.35 lakh |
| Savings on spoilage + spillage | ₹2.30 lakh | ₹5.75 lakh |
| Savings on cans + transport | ₹1.97 lakh | ₹4.93 lakh |
| Total Income | ₹12.81 lakh | ₹32.03 lakh |
| Gross Surplus | ₹3.42 lakh | ₹6.41 lakh |
| Metric | 2,000-litre | 5,000-litre |
|---|---|---|
| BCR | 1.074:1 | 1.092:1 |
| NPW | ₹3.548 lakh | ₹10.857 lakh |
| IRR | 25.57% | 36.57% |
| Average DSCR | 1.673 | 2.059 |
The 5,000-litre unit is financially superior on all metrics. NABARD is the nodal agency for the Dairy Entrepreneurship Development Scheme (DEDS) which provides capital subsidy (25% or 33.33%) for purchase of BMC units up to 5,000 LPD — a key linkage frequently tested in exams.
Source & Full Report
This lesson is based on the official NABARD publication:
Model Scheme on Bulk Milk Cooling Centers
| Field | Details |
|---|---|
| Publisher | National Bank for Agriculture and Rural Development (NABARD), Mumbai |
| Source | nabard.org — Model Bankable Projects |
| Mirror | TNAU Agritech Portal |
| Licence | Government of India — free for educational use |
📥 Download Full NABARD Report (PDF)
The figures in this lesson reflect the cost norms and technical parameters as published in the NABARD document. Actual costs may vary by state, season, and year of implementation. Always refer to the latest NABARD circular for current norms.
Summary Cheat Sheet
| Concept / Topic | Key Details / Explanation |
|---|---|
| Two model sizes | 2,000-litre and 5,000-litre BMC units |
| Cooling target | 4°C within 3 hours of milking (Codex Alimentarius standard) |
| Total Cost — 2,000L | ₹11.78 lakh |
| Total Cost — 5,000L | ₹17.24 lakh |
| Margin Money | 20% (2,000L: ₹2.36 lakh; 5,000L: ₹3.45 lakh) |
| Bank Loan | 80% (2,000L: ₹9.42 lakh; 5,000L: ₹13.79 lakh) |
| Chilling charge from union | ₹1.30/litre (both sizes) |
| Milk transport cost to BMCU | ₹0.65/litre |
| Power and fuel | 2,000L: ₹0.35/litre; 5,000L: ₹0.40/litre |
| Depreciation | 10% per annum (both sizes) |
| Interest rate | 12% per annum (both sizes) |
| Repayment period | 2,000L: 9 years; 5,000L: 8 years (larger unit = better economies of scale) |
| Capacity utilisation | Year 1 (6 months): 60%; Year 4+: 90% |
| BCR | 2,000L: 1.074:1; 5,000L: 1.092:1 |
| IRR | 2,000L: 25.57%; 5,000L: 36.57% |
| Average DSCR | 2,000L: 1.673; 5,000L: 2.059 |
| Stabilised gross surplus | 2,000L: ₹3.42 lakh; 5,000L: ₹6.41 lakh |
| India milk production (2015-16) | 155.5 million tonnes (1st in world, 19% of global output) |
| Why 5,000L is better | Superior BCR, IRR, DSCR — economies of scale |
| Linked scheme | DEDS (Dairy Entrepreneurship Development Scheme) — 25%/33.33% capital subsidy for BMC up to 5,000 LPD |
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Bulk Milk Cooling (BMC) units are critical cold-chain infrastructure. As per Codex Alimentarius, milk must be cooled to 4°C immediately after milking — without cooling, milk spoils within 3–4 hours in hot Indian conditions. BMC units allow collection centre-level chilling, enabling alternate-day transportation and significant cost savings.
- India: 1st in world milk production with 19% of global output
- Milk production 2015-16: 155.5 million tonnes
- BMC cooling target: 4°C (within 3 hours from 35°C)
Project Overview
NABARD covers two model sizes: 2,000-litre and 5,000-litre BMC units. Both models operate by chilling milk at the collection centre itself, then transporting to the main dairy less frequently. Income comes from chilling charges (₹1.30/litre from milk union) plus savings on spoilage, spillage, can costs, and transport.
The project assumes no civil cost — installation is in existing collection centre space. About 800–1,200 sq ft of constructed area is sufficient.
Financial Structure
| Component | 2,000-litre | 5,000-litre |
|---|---|---|
| Bulk milk cooler with accessories | ₹5.30 lakh | ₹8.90 lakh |
| Generator, weighing, AMCU, installation etc. | ₹6.48 lakh | ₹8.34 lakh |
| Total Cost | ₹11.78 lakh | ₹17.24 lakh |
| Margin Money (20%) | ₹2.36 lakh | ₹3.45 lakh |
| Bank Loan (80%) | ₹9.42 lakh | ₹13.79 lakh |
NOTE
BMC margin money is 20% — between AMCU (25%) and hydroponics (0%). The 80% bank loan reflects the infrastructure nature of the project where the cooler is permanent capital equipment.
Technical Parameters
| Parameter | 2,000-litre | 5,000-litre |
|---|---|---|
| Capacity utilisation (Year 1, 6 months) | 60% | 60% |
| Capacity utilisation (Year 4+) | 90% | 90% |
| Chilling charge from union | ₹1.30/litre | ₹1.30/litre |
| Saving on spoilage/curdling (1% of milk) | ₹7/litre | ₹7/litre |
| Milk transportation cost to BMCU | ₹0.65/litre | ₹0.65/litre |
| Power and fuel | ₹0.35/litre | ₹0.40/litre |
| Depreciation | 10% | 10% |
| Interest rate | 12% per annum | 12% per annum |
| Repayment period | 9 years | 8 years |
NOTE
The 2,000-litre model has a longer repayment period (9 years) than the 5,000-litre model (8 years) because of lower income per unit investment — larger units achieve better economies of scale.
Income & Financial Analysis
Stabilised annual income (Year 4+):
| Income Head | 2,000-litre | 5,000-litre |
|---|---|---|
| Chilling charges (₹1.30/litre) | ₹8.54 lakh | ₹21.35 lakh |
| Savings on spoilage + spillage | ₹2.30 lakh | ₹5.75 lakh |
| Savings on cans + transport | ₹1.97 lakh | ₹4.93 lakh |
| Total Income | ₹12.81 lakh | ₹32.03 lakh |
| Gross Surplus | ₹3.42 lakh | ₹6.41 lakh |
| Metric | 2,000-litre | 5,000-litre |
|---|---|---|
| BCR | 1.074:1 | 1.092:1 |
| NPW | ₹3.548 lakh | ₹10.857 lakh |
| IRR | 25.57% | 36.57% |
| Average DSCR | 1.673 | 2.059 |
The 5,000-litre unit is financially superior on all metrics. NABARD is the nodal agency for the Dairy Entrepreneurship Development Scheme (DEDS) which provides capital subsidy (25% or 33.33%) for purchase of BMC units up to 5,000 LPD — a key linkage frequently tested in exams.
Source & Full Report
This lesson is based on the official NABARD publication:
Model Scheme on Bulk Milk Cooling Centers
| Field | Details |
|---|---|
| Publisher | National Bank for Agriculture and Rural Development (NABARD), Mumbai |
| Source | nabard.org — Model Bankable Projects |
| Mirror | TNAU Agritech Portal |
| Licence | Government of India — free for educational use |
📥 Download Full NABARD Report (PDF)
The figures in this lesson reflect the cost norms and technical parameters as published in the NABARD document. Actual costs may vary by state, season, and year of implementation. Always refer to the latest NABARD circular for current norms.
Summary Cheat Sheet
| Concept / Topic | Key Details / Explanation |
|---|---|
| Two model sizes | 2,000-litre and 5,000-litre BMC units |
| Cooling target | 4°C within 3 hours of milking (Codex Alimentarius standard) |
| Total Cost — 2,000L | ₹11.78 lakh |
| Total Cost — 5,000L | ₹17.24 lakh |
| Margin Money | 20% (2,000L: ₹2.36 lakh; 5,000L: ₹3.45 lakh) |
| Bank Loan | 80% (2,000L: ₹9.42 lakh; 5,000L: ₹13.79 lakh) |
| Chilling charge from union | ₹1.30/litre (both sizes) |
| Milk transport cost to BMCU | ₹0.65/litre |
| Power and fuel | 2,000L: ₹0.35/litre; 5,000L: ₹0.40/litre |
| Depreciation | 10% per annum (both sizes) |
| Interest rate | 12% per annum (both sizes) |
| Repayment period | 2,000L: 9 years; 5,000L: 8 years (larger unit = better economies of scale) |
| Capacity utilisation | Year 1 (6 months): 60%; Year 4+: 90% |
| BCR | 2,000L: 1.074:1; 5,000L: 1.092:1 |
| IRR | 2,000L: 25.57%; 5,000L: 36.57% |
| Average DSCR | 2,000L: 1.673; 5,000L: 2.059 |
| Stabilised gross surplus | 2,000L: ₹3.42 lakh; 5,000L: ₹6.41 lakh |
| India milk production (2015-16) | 155.5 million tonnes (1st in world, 19% of global output) |
| Why 5,000L is better | Superior BCR, IRR, DSCR — economies of scale |
| Linked scheme | DEDS (Dairy Entrepreneurship Development Scheme) — 25%/33.33% capital subsidy for BMC up to 5,000 LPD |
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