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Milma: Offsetting High Input Cost of Farmers Main Factor for Price Hike

In Agriculture
December 01, 2022

Offsetting the soaring input cost suffered by dairy farmers in the state was the basic reason that led Kerala Co-operative Milk Marketing Federation (KCMMF), known by the brand Milma, to raise the price of milk by Rs 6 per litre from December 1, its Chairman K.S. Mani said today.

As per the revision, worked out based on the recommendations of an experts committee and in consultation with the State Government, 500 ml of double-toned milk is priced at Rs 24, non-homogenized toned milk at Rs 25, homogenized toned milk at Rs 26, homogenized toned milk of 525 ml at Rs 28, 500 ml of standardized milk at Rs 29, and 520 ml pride milk at Rs 28.

The farmers will get an overwhelming portion of 83.75 per cent (Rs. 5.025) of the increased price. While 0.75 per cent (Re 0.045) of the increase will go to the Dairy Farmers’ Welfare Board. The milk co-operative societies and the dealers will receive 5.75 per cent (Re 0.345) of the increased price. The Federation will get 3.5 per cent (Re 0.21) and 0.5 per cent (Re 0.03) will go into the plastic elimination program.

While bulk of the benefit of the price revision will go to the farmers, the milk co-operative societies and the dealers will also benefit from the decision, taken in the best interest of the dairy sector which has been passing through a highly difficult phase for the last few years, Shri Mani said.

The input cost incurred by farmers in Kerala is much higher compared to other states. Though the farmers had been pressing for an increase in procurement price proportionate to the cost, that demand was held over in view of the outbreak of Covid-19 pandemic, which resulted in severe restrictions.

During the pandemic period, Milma’s procurement of milk exceeded the supply. This has come in the way of considering the farmers’ demand. The last time Milma revised price of milk was in 2019.

With the pandemic sliding and curbs being lifted, Milma entrusted a committee of experts from Agriculture and Veterinary universities to look into the demand of farmers. The panel found that a farmer suffered a loss of Rs 8.57 for producing a litre of milk. The current price revision was decided on the basis of the recommendations of the panel.

Though Milma’s Board has the competence to go for the price rise considering these factors, the decision was taken after discussions with the state government based on the recommendations of the Experts Panel, Mani said.

A procurement price chart which ensures a higher price based on the quality of milk has been drawn up. Milma can only function as per the laws in determining the price based on quality. The price chart ensures that the farmers the maximum benefit based on the quality of milk. The milk with 3.0/8.5 quality received at the society is ensured with an increase of Rs. 5.025 per litre. For state average milk with 4.1/8.3 quality the regional unions will give Rs. 6.07 per litre increase to the societies and the societies will give an increase of Rs. 5.68 per litre to the farmer.

Referring to the decision to increase cattle feed price including SLBP supply, Mani said the cattle feed plants of Milma have been working on loss for the last seven months, which has accumulated up to Rs 20 crore by October. The increase of raw material cost and supply crunch have hit the cattle feed plants hard. The last price revision of cattle feed was in 2019. Milma was also giving ample subsidies and discounts to the farmers for cattle feed in this period. The prices of Milma and KFL cattle feed were hiked based on the study of a panel set up by the government. The Government has also increased the price of cattle feed under the SLBP scheme.