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LATEST NEWS UPDATES | UP & Punjab farmers protest as private dairies cut purchase price-Madhvi Sally

UP & Punjab farmers protest as private dairies cut purchase price-Madhvi Sally

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published Published on Mar 26, 2012   modified Modified on Mar 26, 2012

Dairy farmers and contractors in western Uttar Pradesh and Punjab are on a warpath after private milk companies reduced procurement prices to take advantage of a bumper milk production.

Farmers allege that companies are profiteering because they have not simultaneously reduced consumer prices. But companies say they have huge stocks of unsold milk and milk powder and a cut in procurement prices is to bring pressure on government to allow exports. 

Cooperatives such as Mother Dairy and Amul are unlikely to cut farm-gate prices with because milk production is expected to go down in summer. 

A good winter this year has extended the flush season with milk procurement increasing by 20% across the country. According to an industry estimate, the country has a stock of over one lakh tonne skimmed milk powder this year compared to close to 20,000 tonne in the previous year. "We think protests will continue till Monday. We want the government to allow casein exports. 
Milk
Also milk cooperatives such as Pradeshik Cooperative Dairy Federation (PCDF) and National Dairy Development Board-owned Mother Dairy should procure milk from the local market rather than from other states to ensure farmers get better returns," said Amrit Dairy owner Ram Avtar who owns a chilling unit with a processing capacity of 50,000 litre at Bulandshahr in Uttar Pradesh where milk suppliers and small chilling units are demanding export of milk protein called casein. 

On Saturday, protests were held by suppliers across Meerut, Agra, Mathura, Aligarh and Bulandshahr. Uttar Pradesh produces more milk than New Zealand, the world's largest exporter. 

Dairy cooperatives procure approximately 30 lakh litre milk a day as against 1.6 crore litre of milk produced daily in Uttar Pradesh which allows private players enough space in the state and the neighbouring national capital region (NCR). 

"The strike is called by private suppliers who procure milk from farmers and sell it to companies like ours. With export of casein banned and a flush milk season, we have started reducing the prices since December 2011," said Uttar Pradesh-based VRS Foods MD Rajendra Singh. 

The company sells four lakh litre milk in NCR and is the third largest player after Mother Dairy and Amul. Consumers in NCR consume one crore litre of liquid milk daily. 

The company has been giving suppliers Rs 23-24 for a litre of buffalo milk, with farmers receiving Rs 17-18 a litre. 

Apart from private players, milk cooperatives like The Haryana Dairy Development Co-operative Federation and Rajasthan Co-operative Dairy Federation have also reduced retail milk prices by Rs 1-2 a litre ensuring lower returns to farmers. 

"With global prices of skimmed milk powder and other products lower than Indian prices of Rs 170 a kg, there has not been much of purchase by stockists. 

Private dairy manufacturers are hence burdened with stocks and a poor domestic demand. So they have cut procurement from farmers," said a Mother Dairy official who confirmed that milk procurement prices will largely remain unchanged. Currently the company gives Rs 25-26 to dairy farmers for buffalo milk. 

Milk procurement by Gujarat Cooperative Milk Marketing Federation (GCMMF), the largest player that markets Amul brand of dairy products, has gone up to an all-time high to 138 lakh litre, an increase of 20% compared to the previous year. 

"Our district cooperatives will not reduce milk procurement price. Due to an attractive procurement price and aggressive marketing, Amul has seen an alltime rise in milk procurement this flush season," said GCMMF MD R S Sodhi. GCMMF-affiliated cooperatives have kept their procurement price unchanged at an average of Rs 31 a litre.

The Economic Times, 26 March, 2012, http://economictimes.indiatimes.com/news/economy/agriculture/up-punjab-farmers-protest-as-private-dairies-cut-purchase-price/articleshow/12409041.cms


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