Members of Progressive Dairy Farmers Association pour milk on a road during a protest against the government for cuts in the prices of milk products, at Jantar Mantar in New Delhi on 31 July 2018. Photo: PTI
Members of Progressive Dairy Farmers Association pour milk on a road during a protest against the government for cuts in the prices of milk products, at Jantar Mantar in New Delhi on 31 July 2018. Photo: PTI

Dairy farmers protest in Delhi as milk prices crash

The protest, organised by the All India Progressive Dairy Farmers Association, petitioned the Centre for direct price support, higher export incentives and GST exemption for milk products

New Delhi: The spectre of crashing milk prices and farm distress reached Delhi on Tuesday with dairy farmers from Punjab protesting at Jantar Mantar and emptying cans of milk on Parliament Street.

The protest, organised by the All India Progressive Dairy Farmers Association, also petitioned the Centre for direct price support, higher export incentives and GST exemption for milk products. Members of the dairy union are expected to meet Agriculture Minister Radha Mohan Singh on Wednesday.

“Prices in Punjab have crashed to a low of 20-22 for a litre of cow milk and 26-27 for a litre of buffalo milk. Despite these low prices, payments to farmers are getting delayed," said S. Daljit Singh, president of the dairy farmer’s association.

“We want the Centre to announce a direct subsidy of 5-7 per litre for dairy farmers and provide 50% incentive for export of milk powder," Singh said. “Without government support, the situation will worsen as the flush season of milk production begins in October," he added.

The protest by farmers from Punjab comes close on the heels of another agitation by farmers in Maharashtra earlier in July demanding direct price support, as prices fell to a low of₹17 per litre in the state.

Milk production in India, the largest milk-producing country in the world, rose to a record 176.4 million tonnes in 2017-18, about 6.6% higher than the year before. Wholesale dairy prices collapsed on higher production and stalled exports of milk powder due to low international prices.

Dairies generally convert surplus milk into skimmed milk powder, which is exported. But currently international prices are around 120 per kg, substantially lower than India’s cost of producing skimmed milk powder at over 200 per kg.

The situation may take a turn for worse. Milk production in India could touch a high of 186 million tonnes in 2018-19, leading to a higher marketable surplus in the system, India Ratings and Research said in a note on Tuesday.

“Recent policy measures of increasing the import duty on whey, offering a subsidy to milk farmers and exempting certain categories of dairy products from the goods and services tax will provide marginal relief to the dairy sector," the note said.

It added that the sector would continue to face high skimmed milk powder inventories and low prices, so long as the global market for skimmed milk powder and casein does not revive.

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