The Karnataka Milk Federation’s (KMF) move to increase consumer price of milk and curd comes at a time when milk producers in high milk-producing districts are in distress, while the federation is losing out milk to private dairies owing to low procurement cost.
In fact, lumpy skin disease alone is estimated to have brought down milk production by about one lakh litre a day, while the private milk producers procuring milk in Karnataka and selling across the border has affected KMF badly. From a daily average procurement of 94.2 lakh litres in June 2022, the KMF has witnessed a steep decline in procurement to 78.8 lakh litres now daily due to private milk producers. The price range of milk sold by private dairies in the State has gone up from ₹44 a litre to ₹50 a litre.
“The federation suffered as many milk producers in border districts, especially Kolar, had started supplying to private milk dairies,” said sources in KMF. In fact, the Kolar district union at an emergency meeting on November 10 increased the procurement price by ₹2 per litre to prevent milk producers from selling the milk to private dairies.
Senior officials said that the federation is currently losing out ₹1 per litre owing to high operating cost and low market price. “Though we will be passing the entire hike amount to farmers, the federation will make up with the volume. We are expecting procurement to go up by about 8 lakh litres a day after the hike is effected,” the official said.
Sources said that the milk farmers, who have seen a sharp rise in input cost over the past two years, did not see the profession profitable in the recent months. “The cost of fortified feed alone has gone up by 10% in less than two years. The cost of other inputs have also gone up due to rising petroleum cost. Added to this was heavy rainfall that brought down milk production.”
According to the federation sources, the milk producers in the State receive between ₹27 per litre and ₹31 per litre as procurement price depending on the district milk unions. “The procurement price is low in North Karnataka district unions while it is higher in high milk producing districts. The average works out to be about ₹29 per litre in the State.”