Export of milk powder starts, but dairies wait for govt subsidy to pay farmers

The procurement prices had dropped due to a slump in global prices of skimmed milk powder (SMP), which had hit exports and left dairies with excess stock of the powder.

Written by Partha Sarathi Biswas | Pune | Published: September 14, 2018 1:59:41 am
Maharashtra: To corner out-of-state players, dairies decide to slash milk price In July, the Swabhimani Shetkari Sanghatana had stopped supply of milk to Mumbai and Pune, to demand better procurement prices for farmers. (File photo)

Two months after an agitation by dairy farmers seeking higher procurement prices hit the supply of milk to Mumbai and Pune, and necessitated government intervention, farmers in the state continue to get paid well below the Rs 25-27 per litre mark. The dairies making the payments have blamed the government, saying it had delayed the release of the promised subsidy for farmers.

In July, the Swabhimani Shetkari Sanghatana had stopped supply of milk to Mumbai and Pune, to demand better procurement prices for farmers. The procurement prices had dropped due to a slump in global prices of skimmed milk powder (SMP), which had hit exports and left dairies with excess stock of the powder. It was estimated that around 2 lakh tonnes of SMP has accumulated in the country.

As they dealt with low SMP sales, dairies had slashed the procurement prices given to farmers. Instead of the government-declared rate of Rs 27 per litre for milk, with 8.5 per cent fat and 3.5 per cent SNF(solid not fat), farmers were paid between Rs 20 and 17 per litre.

To end the crisis in the industry, the central and state governments had announced a subsidy for exports, as well as one for farmers. Dairies that exported SMP were given a subsidy of Rs 50 per kg ,while dairies that did not opt for an export subsidy were paid Rs 5 per litre of milk, to be paid to the farmers.

Some dairy owners, however, have complained about the delay in the release of the Rs 5 per litre government subsidy, meant to be paid to dairy farmers. They said they received the subsidy only for the first two cycles, after which it stopped.

Most dairies have been paying Rs 20 per litre to farmers, approximately the amount they were paying before the milk agitation in July. However, Vishwas Patil, chairman of the Kolhapur District Milk Producers Union, the cooperative dairy which owns the brand Gokul, said the dairy is paying Rs 25 per litre to farmers.

“Our milk collection, which had touched 14 lakh litres per day, has come down to 12 lakh litres, so we can pay the higher prices,” he said. Dasarath Mane, chairman of the Indapur Dairy and Milk Products Limited, the owner of the brand Sonai, said the Rs 50 per kg export subsidy just about helps dairies meet their expenses, after deducting shipping and packing costs.

Rajiv Mitra, managing director of the Phaltan-based Govind Milk and Milk Products, said exports to Bangladesh have also started.

For all the latest Pune News, download Indian Express App