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LATEST NEWS UPDATES | White Truth: Milk turns sour for farmers on back of record powder stocks with dairies -Parthasarathi Biswas

White Truth: Milk turns sour for farmers on back of record powder stocks with dairies -Parthasarathi Biswas

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published Published on Jan 18, 2018   modified Modified on Jan 18, 2018
-The Indian Express

The dairies are blaming the current situation on the crash in international skimmed milk powder (SMP) prices

Puntamba (Maharashtra):
Since early September, Nitin Dhanvate’s dairy farm business has gone for a toss. Till around then, the 33-year-old from this village in Ahmednagar district’s Rahata taluka was receiving Rs 28 per litre for the milk containing 3.5 per cent fat and 8.5 per cent SNF (solids-not-fat) he was supplying to Prabhat Dairy Ltd. But today, that price has dipped to Rs 22.50 per litre.

Dhanvate’s four cows give him an average 40 litres daily, which, at Rs 22.50 a litre, generates a monthly revenue of Rs 27,000. “But I spend Rs 24,000 towards dry fodder, feed concentrate and supplements for my eight animals, including calves and young heifers. What does it leave me with?” asks this farmer, who also grows lucerne and alfalfa green fodder on two out of his four-acre holding. “My losses would have been more had I been purchasing green fodder, too,” he notes.

Dhanvate was among the many who participated in the “Shetkari Sampa” or state-wide farmers’ strike that rocked Maharashtra in early June. He, along with other farmers of Puntamba — the village that spawned the week-long stir — stopped supplying milk to Prabhat Dairy’s local collection centre. Farmers were actually getting Rs 28 per litre then, though the rate had fallen as low as Rs 18 only six months earlier. The strike was called off when the state government agreed to implement a minimum procurement price of Rs 27 per litre. “It looks we will have to strike again,” says Dhanvate, who had to sell one of his cows last month. “If prices don’t improve, I may have to further reduce my herd strength,” he sighs.

Dhanvate is relatively lucky. Dairies in Pune districts are paying Rs 19-21 per litre for the same milk of 3.5 per cent fat and 8.5 per cent SNF. The Kolhapur district milk union is procuring at Rs 25, but only from its farmer-members; non-members are getting Rs 21-22. Most cooperatives are offering Rs 21-23, below the government’s declared Rs 27 rate.

The dairies are blaming the current situation on the crash in international skimmed milk powder (SMP) prices. SMP rates at globaldairytrade, the New Zealand milk processing giant Fonterra’s online auction platform, averaged $ 1,818 a tonne on Tuesday, compared to $ 2,612 a year ago and the record $ 5,142 on April 2, 2013. It has made SMP exports from India — these have plunged from 1.3 lakh tonnes (lt) to 16,100 tonnes between 2013-14 and 2016-17 — unviable.

“We annually produce 5 lt, of which 4 lt is consumed domestically. The balance one lt was getting exported, which has now virtually stopped. The surplus powder is getting accumulated, forcing us to either curtail milk procurement or slash prices,” observes Vinayakrao Patil, chairman of the Rajarambapu cooperative dairy near Sangli. Indian dairies are expected to have about two lt of carryover SMP stocks in March-end, which, Patil fears, will put further pressure on prices in the coming fiscal.

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With additional inputs from Harish Damodaran in New Delhi

The Indian Express, 18 January, 2018, http://indianexpress.com/article/india/white-truth-milk-turns-sour-for-farmers-on-back-of-record-powder-stocks-with-dairies-5029273/


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