Despite flush season, dairy farmers in Maharashtra fetch good procurement prices

November 9, 2022

Dairy farmers in the state are enjoying a rare spell of good price, which has seen dairies increase their procurement price even as the sector enters its flush season when production increases. Dairies say there is a 10-15 per cent dip in output in many milk-producing states, which has led them to increase the procurement price for their farmers.

States like Gujarat, Maharashtra and Karnataka have reported incidents of lumpy skin disease in their cattle population, which has affected milk production. Dasarath Mane, Chairman cum Managing Director (CMD) of the Pune-headquartered Indapur Dairy and Milk Products Ltd (popular as Sonai Dairy) said most dairies have reported a 10-15 per cent dip in production. “Our procurement price for milk with 3.5 per cent fat and 8.5 per cent SNF (solid-not-fat) at present is Rs 36/litre. The tight supply-demand situation led us to increase our prices last month,” he said.

With the flush season starting on a tight note, Mane hoped the situation would improve a bit by February. In dairy trade, the terms ‘flush’ and ‘lean’ refer to the months when milk production increases and decreases. Thus from October to February when animals naturally produce more milk, the trade enters the flush season. March onwards, animals reduce their milk production and the trade enters what is called as the lean season. Dairies normally reduce their procurement price during the flush season.

Dairies said the present rise in procurement prices is expected to continue till next October. Internationally, skimmed milk powder (SMP) has recorded a 17 per cent dip in prices from April. This, trade analysts say, is mostly due to the frequent lockdowns in China, which is the biggest importer of SMP. Also, countries like New Zealand and Australia have reported a dip in output.

At present, domestic SMP prices are in the Rs 320-330/kg range while international prices are hovering around Rs 230/kg. Mane said India had exported around 80,000 tonnes of SMP last year with the lion’s share of exports by Gujarat Cooperative Milk Marketing Federation which markets under the brand Amul and Sonai. With the flush season starting, SMP production by dairies would improve. Meanwhile, the price increase has brought a smile on the faces of dairy farmers. Karan Atole, who runs a milk collection centre in Baramati taluka of Pune district, said farmers have been fetching good price since the last month or so.

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