Amidst brands like Amul, MotherDairy raising milk rates, dairy farmers in Punjab have now sought hike in milk procurement prices from the state-owned milk federation Milkfed, citing 25-30 per cent hike in input cost.
"We are demanding from Punjab Milkfed to further increase milk procurement rates as it has become increasingly difficult to supply at current rates in view of considerable increase in our input cost," Progressive Dairy Farmers' Association (PDFA) Punjab, president Daljeet Singh said on Monday.
Progressive dairy farmers supply about 3 lakh litres per day to Punjab State Cooperative Milk Producers Federation (Milkfed Punjab) which is almost 30 per cent of Milkfed's total milk procurement, he said.
Dairy farmers are demanding milk procurement rate of Rs. 600 per kg fat from Milkfed Punjab.
"Amul brand has now started giving milk procurement rate of Rs. 590 per kg fat to its farmers but here we are getting very low prices as compared to rates being given by Amul," he claimed.
Milkfed Punjab, which sells milk and milk products under Verka brand, has raised milk procurement rates for farmers by Rs. 20 per kg fat to Rs. 540 per kg fat on May 1.
However, Punjab Milkfed has not yet taken any decision on raising retail milk and milk products prices yet on account of raising milk procurement prices.
"We had to raise (milk procurement) prices (for farmers) because in summers milk availability is less and to boost milk supply, prices are raised for farmers. If that has an implication on our cost of production, we will take a call on whether to raise prices (retail rates) or not," Milkfed (Punjab) MD, Alaknanda Dyal said.
However, she made it clear that retail milk prices of Verka brand would not be raised in a day or two.
Milkfed, which is the biggest player in the organised dairy market in Punjab, had already raised milk prices by Rs. 4 per litre since December last.
Milkfed is currently selling milk at Rs. 44 per litre (full fat), Rs. 40 (Standard), Rs. 36 (toned) and Rs. 32 (double toned).
During hot weather conditions, milk production usually goes down due to heat stress in animals.
Milkfed, which sells milk and milk items in Punjab, Chandigarh and few places in Himachal Pradesh, is currently procuring milk in the range of 13 lakh litres per day from small and big dairy farmers.
Dairy farmers noted that input cost had gone up by 25-30 per cent, making it "unviable" for them to run dairy farms while many of farmers had shut down their businesses.
"Soybean rates have gone up by 30 per cent to Rs. 3,100 per quintal while mustard cake prices went up by Rs. 250 per quintal and prices of mustard cake has also shoot up to Rs. 1,050 per quintal," he said.
Meanwhile, PDFA which is also selling milk with its own brand 'La Pure', will raise its prices by Rs. 2 per litre. "We will raise our milk prices by Rs. 2 per litre soon," said Singh.
PDFA which started selling own milk last year is currently processing 40,000 litres of milk per day and it is selling a few markets in Punjab.