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China Import Curb Has Hit Milk Producers Badly

Date 24-April-2015
Subject China Import Curb Has Hit Milk Producers Badly

Milk producers are going through a slump and those in Maharashtra are among the worst affected, said RS Sodhi managing director of Gujarat Cooperative Milk Marketing Federation Limited (GCMMF) which sells the Amul brand.

Sodhi was in the city to deliver a lecture at National Academy of Direct Taxes (NADT). Speaking to TOI after the function, he said the dairy industry is going through a global slump with China being a major reason for the situation.

China, which was a major importer of dairy products, has curbed purchases from previous year. This has coincided with a glut in New Zealand as well as Europe. Exports by Amul, which stood at Rs510 crore in the 2013-14, came down to Rs280 crore 2014-15. This also led to crashing of rates. The international prices of milk powder have come down to $2,000 a metric tonne as against $4,500 last year, which has ultimately hampered the competitiveness of the Indian industry, said Sodhi.

"On the other hand, there has been a rise in the price of dry fodder, leading to an increase in the cost for milk producers. However, there is little scope for an increase in procurement rates. The situation is comparatively better in states like Gujarat or Karnataka where the dairy cooperatives are organized. In Maharashtra, the procurement rates are down to Rs17 a litre from Rs25-26 for cow's milk," he said.

However, the slump will benefit consumers. With no immediate chances of increase in the procurement rates, the price of milk will also not go up, said Sodhi.

India exports milk and its products to countries like Pakistan, Afghanistan, Middle-East and also China. China has been a biggest importer world over. The going was good when China was buying but it has now left the entire industry in a desperate situation. Though the dairy business is expected to revive in the coming year, it may be too late for many of the producers, he said.

Source :

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