Tamil Nadu dairy farmers threaten Aavin supply halt over milk price hike
The Tamil Nadu Milk Producers’ Welfare Association on Thursday announced that its members would stop supplying milk to cooperative milk societies from August 24, unless the government revised the procurement price to ₹44 a litre. The announcement follows the State government’s recent decision to increase the procurement price from ₹35 to ₹36 per litre and the incentive from ₹3 to ₹5 per litre.
Association president R. Rajendran told reporters that dairy farmers were "hugely disappointed" with the latest revision. He said the procurement price had not been raised since 2022, when it was increased by ₹3 per litre. In December 2023, the then government sanctioned an incentive of ₹3 per litre. Since then, the cost of cattle feed and other inputs had increased substantially, but the price offered by Aavin, the Tamil Nadu Cooperative Milk Producers' Federation, did not cover the increased production cost.
Mr. Rajendran also pointed out that private dairies were offering up to ₹48 per litre, making Aavin's price uncompetitive. The association had been demanding an increase of ₹10 per litre in the procurement price, in addition to the incentive. Instead, the Chief Minister announced a mere ₹1 per litre increase in the base price.
The TVK, in its election manifesto, had promised to increase the milk procurement price to ₹44 per litre. "We demand that the government implement the promise now," Mr. Rajendran said. He also noted that the retail price of milk had been reduced by ₹3 per litre when M.K. Stalin assumed charge as Chief Minister in 2021. This reduction, he said, had adversely affected the revenue of milk cooperative societies, district unions, and the State federation, impacting their viability. The association had suggested increasing the retail price to help cooperatives recover.
The latest price revision, according to Mr. Rajendran, was announced without considering these issues. He said the Chief Minister had increased the procurement price from ₹35 to ₹36, and the incentive from ₹3 to ₹5 per litre. "We have been demanding an increase of ₹10 per litre for cow’s milk, but the Chief Minister increased it by just ₹1 a litre. Dairy farmers are hugely disappointed by the announcement. When private dairies offer up to ₹48 a litre, why should we supply for ₹36 a litre?" he asked.
Aavin, a major milk brand in Tamil Nadu, collects around 20 lakh litres of milk every day from about 3.5 lakh farmers through a network of over 20,000 primary milk cooperative societies. Any disruption in supply would directly affect consumers in urban areas, where Aavin is the primary milk supplier.
Mr. Rajendran said the government should reconsider the decision by August 23, failing which farmers would stop supplying milk to cooperative societies from August 24. He also indicated that the association was open to talks with the government, but maintained that the price increase must be "meaningful" to ensure the sustainability of dairy farming.
