In a recent development, the Greater Guwahati Dairy Farmers’ Association has announced a substantial increase in milk prices in Guwahati, India. According to reports, the decision to raise the prices by Rs 5 per litre was driven by the surge in fodder costs, posing challenges for dairy farmers. Consequently, the new rate for a litre of milk stands at Rs 58, up from the previous price of Rs 53.
The association has highlighted the escalating prices of fodder as the primary factor behind this decision. They argue that the increased expenditure on cattle feed has strained their operations, necessitating a revision of milk prices. However, this move has not been well received by wholesale suppliers who are now reluctant to purchase milk at the new rates.
Wholesale suppliers, facing the burden of the elevated purchasing price of Rs 58.60 per litre, are opting out of buying milk from dairy farmers. This development further exacerbates the challenges faced by farmers who are left with surplus milk and dwindling avenues for selling their produce.
In response to the resistance from wholesale suppliers, the Greater Guwahati Dairy Farmers’ Association has threatened to bypass them and directly sell milk to consumers. This course of action, if implemented, could potentially disrupt the established distribution network and lead to a direct farmer-to-consumer model.
It is worth noting that this is not an isolated incident of milk price hikes. In early 2023, the renowned Gujarat Cooperative Milk Marketing Federation Ltd, popularly known as Amul, announced a similar increase in milk prices by up to Rs 3 per litre. The revised rates set Amul Gold at Rs 66 per litre, Amul Taaza at Rs 54 per litre, Amul cow milk at Rs 56 per litre, and Amul A2 buffalo milk at Rs 70 per litre.
Amul’s decision to raise prices was attributed to escalating input costs. In the previous year, Amul had already increased milk prices three times in response to higher production expenses experienced in March, August, and October. Similarly, Mother Dairy, a leading milk supplier in the Delhi-NCR market, also implemented multiple price hikes in 2022, citing rising input costs. In December of the same year, Mother Dairy raised milk prices by Rs 2 per litre in the Delhi-NCR market.
The company highlighted the need for the price adjustment to offset increased input costs. These recurring price hikes indicate the challenges faced by the dairy industry, grappling with rising expenses and seeking to maintain sustainable operations. Also Read – Chaff cutter machines distributed in Chilabandha Agricultural Development Circle The situation in Guwahati highlights the growing tensions between dairy farmers, wholesale suppliers, and consumers.
The price hike imposed by the Greater Guwahati Dairy Farmers’ Association in response to mounting fodder costs has strained the existing supply chain. The reluctance of wholesale suppliers to buy milk at the increased rates poses significant challenges for farmers, leading them to consider alternative avenues such as direct sales to consumers. The decision by the Greater Guwahati Dairy Farmers’ Association to increase prices has created a rift between farmers and wholesale suppliers.
The farmers’ threat to sell directly to consumers signifies the potential for a significant shift in the market dynamics. It remains to be seen how this situation will unfold and the impact it will have on both the dairy industry and consumers in Guwahati.
Source : Sentinel Assam July 2nd 2023