With two major retailers Amul and Mother Dairy announcing an increase of Rs 2/litre in milk prices from Monday, the first hike in the last fourteen months, inflation in the commodity is expected to rise after remaining flat for the last one year.
R S Sodhi, president, Indian Dairy Association said that cooperatives have increased milk prices after February 2023 to offset some of the cost incurred by farmers and impact on the prices would be marginal. “Increase in milk prices is moderate compared to rise in cost of production,” Sodhi told FE
Retail inflation in milk was 2.97% in April on year. Price rise in milk rose to 9.65% in February, 2023 on year and since then it has moderated.
“The surge in farm prices is only being partially passed on to the consumers, with an effective revision of 3-4%, thereby securing the interests of both the milk producers and the consumers,” according to a statement by Mother Dairy.
The Gujarat Cooperative Milk Marketing Federation, which markets milk and products under the Amul brand name, has increased the price of fresh milk by Rs 2/litre across all variants from Monday.
On the rationale behind hike in milk prices, Mother Dairy has stated that prices were last revised in February 2023 and despite paying higher prices towards milk procurement in the last few
months, the consumer prices were kept intact. It stated that the ‘heat stress’ because of hot weather conditions in several parts of the country is likely to further impact milk production.
Manish Bandlish, Managing Director, Mother Dairy Fruit & Vegetable Pvt, last month had told FE “I anticipate slight movement in terms of prices; it may not be a significant movement”.
