The government is not considering importing dairy products such as butter and ghee for now as domestic supplies have improved.
“We are not considering import of dairy products as domestic supplies has improved following the setting in of flush season or peaking of production in southern India which have given boost to milk output,” a senior official told FE.
The official said the requirement of import has receded on improvement in supplies in northern India due to cooler temperature which prevailed last month.
Sources said that several private dairy companies have informed that the supply situation of milk has improved and there is no requirement of imports of products at present.
Earlier, the government had indicated that it may resort to import of dairy products such as butter and ghee if required after assessing the stock position of milk in southern states which have entered flush season where output grows sharply.
“There is no constraint in milk supply as such in the country and there is an adequate inventory of skimmed milk powder,” an official said. India last imported dairy products in 2011.
Some dairy experts also attribute the current supply problems to the Covid-19-induced sudden demand contraction for a few months since March-April 2020. This led to a reduction in cattle population, stunting of the animals and constriction of milk output with a lag.
Despite India being the largest milk producer since 1998, the country’s milk inflation has been the second biggest element after the high prices of cereals that drove up retail inflations since January 2023. Retail milk inflation in March 2023 was 9.24%.
Organised players, including Mother Dairy and Amul, hiked milk prices multiple times in the last one year citing higher fodder cost, robust demand and some impact due to reports of lumpy skin disease.
The country’s milk production is likely to have stagnated in 2022-23 due to due to lumpy skin diseases in cattle across several states and the lagged effect of Covid-19 in the form of stunting of the animals,
The milk production was estimated at 221 million tonne (MT) in 2021-22
According to the Food and Agriculture Organisation, India is the highest milk producer in the world which contributed 24% of global milk output in 2021-22.
The dairy sector has been growing at 6% annually since 2014, while the area under fodder crop area has remained stagnant at around 4% of the gross cropped area in last few decades.