Milk became more expensive across much of India on Thursday, the latest in a run of dairy price increases that began with Karnataka at the start of the month. For households, it is another squeeze on the monthly budget, and one that dairy executives and traders say may not ease soon.
Amul and Mother Dairy announced increases of ₹2-4 per litre on Wednesday, effective November 12. Amul Taaza toned milk now costs ₹62 a litre, up ₹2, while Amul Gold goes to ₹76, up ₹4. In the National Capital Region, Mother Dairy’s pouched full-cream milk rose from ₹72 to ₹76 and pouched toned milk from ₹60 to ₹62. Cow milk went up from ₹62 to ₹65.
The southern market moved first and furthest. Karnataka’s Cabinet approved an ₹8 per litre rise in Nandini milk from November 1, the single largest hike to date. Regular toned milk went from ₹46 to ₹54. Amul also raised ghee prices by ₹50 a litre from November 2, and dairies in Maharashtra agreed a ₹2 increase in cow and buffalo milk in August.
Feed and fodder
The pressure starts on the farm. Cattle feed cost around 15-20 per cent more in September than a year earlier, with maize, rice bran cake, soya-related ingredients and other grains all up. Fodder has followed. Karnataka’s government said the bulk of its increase would go directly to dairy farmers to support their income amid rising fodder costs and falling milk production.
Paying farmers more to keep milk flowing
Dairies say they must pay producers more to keep supplies coming. GCMMF, which markets Amul, said its member unions raised procurement prices by 4-5 per cent over the past year, and that a major portion of the latest increase will go back to producers to encourage higher output. The cooperative said 80 per cent of consumer revenue is returned to 36 lakh milk producers. Mother Dairy returns 75-80 per cent of its milk sales revenue to farmers and said higher procurement prices forced it to pass part of the cost on.
In Karnataka, ₹7 of the ₹8 hike is earmarked for farmers and the remaining ₹1 for milk cooperatives. Chief Minister DK Shivakumar defended it as necessary to shield dairy farmers from mounting losses and to stop milk being diverted to neighbouring states. He said producers had sought a rise of ₹12 a litre.
A thin flush season
The timing has surprised some. Prices generally stay stable during the flush season, when production and availability improve, and the latest hikes point to growing supply constraints in the sector. The flush runs from October to February, when dairies build stocks for the lean months. Uneven rainfall and a below-par monsoon are expected to cut output, and traders expect prices to stay elevated even through the flush.
Demand and other costs
Festive-season demand is adding to the strain. So is a shift from analogue paneer to paneer made from real milk after a nationwide crackdown on the imitation product. Diesel, transport and packaging costs have risen too, and high international dairy prices are expected to affect domestic rates.
What it means for consumers
Because the revisions are phased, the full impact will differ by city and brand. Mother Dairy’s previous increase came on May 14, and Amul raised milk prices by ₹2 a litre that day. With feed costs still elevated and the monsoon shortfall weighing on supply, further adjustments cannot be ruled out. Industry sources said Amul was expected to follow Mother Dairy and Nandini, which it has now done.