To cope up with the unexpected increase in milk procurement this year, the Gujarat Cooperative Milk Marketing Federation (GCMMF), which owns Amul brand, has requested the Centre to increase their offtake by introducing milk and milk-based products in mid-day meal scheme in government-run schools.
According to GCMMF Managing Director RS Sodhi, offtake by government is the best solution for the dairy major to cope-up with the high influx of milk in recent times.
“Our milk procurement is around 20 per cent more than what it was last year. As against this high procurement, demand remained steady. Since private consumption does not go beyond a certain level, it is now expected that government increases its offtake,” said Sodhi.
“The best solution will be that the government introduces milk and milk products in mid-day meal scheme. This will automatically increase demand of our milk. We have written to the government to introduce such scheme. We are expecting some positive outcome,” added Sodhi.
GCMMF Chairman Jethabhai Patel also voiced the same concern, claiming that huge stock of milk powder is lying with them due to low demand.
“Normally, we make milk powder from the excess milk which remains with us after making other products. However, huge stock is still lying with us, as prices have gone down heavily and demand is very less. On the other side, milk procurement has increased by almost 20 per cent,” said Patel.
“Our milk procurement has increased because more and more farmers are leaving farming and turning to cattle rearing due to high returns. But, this has increased our troubles, as milk consumption among people can’t be increased overnight by marketing efforts,” said Patel.
Sodhi too agreed that milk powder business has no longer remained lucrative.
“Prices of milk powder in global market have gone down almost 50 per cent, while it dipped 30 to 40 per cent in India. Thus, milk powder is not a solution in current scenario. Thus, the best solution would be more government offtake” said Sodhi.
This peculiar situation is also hitting those who are dependent on cattle rearing, as they are not getting the expected prices, said Sodhi.
“Every year, milk procurement price paid to cattle rearers by us increase 8 to 10 per cent. But, that has now come down to 2 to 3 per cent in recent years. In such a scenario, even cattle rearers are complaining, as cost of fodder has increased over a period of time and returns are not that much lucrative,” said Sodhi.