World Milk Day: Branding, pricing, international markets afflicting the dairy sector

Prathmesh Patil
Friday, 1 June 2018

Pune: Milk has been not just an important part of diet and food habits but also one of the most important commodities in the world.

The dairy sector is considered a major supplementary business to agriculture and especially in an agrarian crisis like situation in the country, it is the only relief to farmers. But it has also now started facing a crisis of its own. 

Pune: Milk has been not just an important part of diet and food habits but also one of the most important commodities in the world.

The dairy sector is considered a major supplementary business to agriculture and especially in an agrarian crisis like situation in the country, it is the only relief to farmers. But it has also now started facing a crisis of its own. 

Recently, dairy farmers have been complaining that though the consumer pays a premium price for dairy products, the farmer rarely gets the benefit. The current price for packed cow milk is around Rs 38 to Rs 40 per litre. The farmers across the State were promised an already low rate of Rs 27 per litre, even which farmers allege, is not given, earning them only Rs 17-19 per litre.  

“When we collect milk, the major component of our earning is not packet milk. Packet milk only constitutes 40 pc of our sales and production. Majority of the milk, especially in bigger dairies, goes towards producing milk powder and butter,” said Vishnu Hinge of the Pune Jilha Dudh Utpadak Sangh and the chairman of Katraj Dairy, adding, “What we earn from packet milk and Indian sweets like Shrikhand is little compared to our export of powder.” Hinge added that milk powder markets have suffered internationally this year. “The major buyers of milk powder are China and Middle Eastern countries. This year, New Zealand sold milk powder to these buyers at cheap rates and they bought buffer stocks. This means the rates fell and it also became difficult to find buyers for milk powder,” he said adding, “This meant that even though packet milk made profits, the losses in milk powder brought down the returns for the farmers.”

Yogesh Pande of the Swabhimani Shetkari Sanghatna, which also runs a dairy business, said, “The milk from outer states is also a major issue. Our neighbouring states give subsidies to milk producers and so they sell their milk here and can afford it. On the other hand, our dairies face an uphill task competing with them,” Pande says. He also added, “The current government has also been very hostile to cooperatives. The environment is not friendly for dairy sector in the State.”

“Other states have single brand marketing too like Amul in Gujarat and Nandini in Karnataka. These brands are umbrella brands where smaller cooperatives sell their produce under these brands,” said Pande. 

He further added, “We had Mahanand, but it failed to pick up as a brand due to negligence and policy. We would agree to such a strategy if our milk is allowed to be sold under such a brand. We would also be able to pay the farmer better if excess milk powder is purchased by the government for its mid-day meal scheme.” 

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