Centre, Maharashtra not interested in intervening on milk MSP issue

Radheshyam Jadhav | | Updated on: Aug 01, 2022

Mumbai, 25/06/2019: A worker of Aarey dairy farm is seen handling the milk jars during a lean period of the day in Mumbai on June 25, 2019. In the year 1951, the first Dairy in Asia was established in Aarey Milk in the fringes of Sanjay Gandhi National Park in Mumbai with the aim of providing sterilized milk to the citizens of the city. A separate Dairy Development Department was set up in the year 1958 to establish the necessary infrastructure for the development of dairy sector in the entire state. The Heads of this department were called Milk Commissioner. After this, 38 Dairy and 81 Chilling Centers were established in the state as per the requirement. In the 1960s, the average milk collection per day in the state was 1 lakh liters, which increased by 114 lakh liters a day between 2015 and 2016. However, the total production of Aarey milk is very less in compare to the demand in the maximum city. Ironically, market is ruled by the private operators. Meanwhile, the state cabinet in 2017 approved a plan to push the Aare Milk brand in the city. Over a period of time Aarey dairy has been neglected by the state government. And, presently the green pasture of Aarey, which is one of last resort for oxygen, is being sliced for Metro 3 carshed and proposal to shift the existing Byculla zoo here. Photo: Arunangsu Roy Chowdhury | Photo Credit: ROY CHOWDHURY A

Centre says co-operatives and private dairies fix prices; but agrees on input costs rising

Dairy farmers in Maharashtra will have to sort out the Fair and Remunerative Price (FRP) or Minimum Support Price (MSP) issue on milk by dealing with the co-operatives and private dairies as the Union and the State government are unwilling to intervene. 

Over the last few months, dairy farmers in Maharashtra have been demanding FRP or MSP for milk so that they don’t suffer losses when dairies cut down the prices. 

The Department of Animal Husbandry and Dairying told the Lok Sabha recently that the Centre does not regulate the procurement and sale prices of milk in the country. “Prices are decided by the co-operative and private dairies based on their cost of production and market forces. Milk pricing being free from government control, this Department does not have any proposal to fix Minimum Support Price (MSP) for milk in the country,” the Department stated. 

Increase in input cost 

However, the Union government has admitted that there has been an increase in the input cost as reported by milk unions, particularly the energy, logistics, and packaging cost which have been attributed to the increased retail prices. 

The selling price comprises the milk procurement price paid to the farmers (including the cost of production) and the cost of processing and marketing. While farmers claim that they receive only a small amount of the sale price, about 74 per cent of the sale price is transferred to the farmers as procurement price.

The Maharashtra government has not responded to farmers’ demand. One of the senior State officials said the State has little say in milk prices as it is finding it difficult to intervene in the matter as the majority of the dairy sector is controlled by private players. The co-operative milk sector in the State is finding it hard to compete with the private dairies.  

State panel 

In May this year, the State government formed a committee under then Deputy Chief Minister Ajit Pawar to discuss FRP for milk. However, with the new government taking charge the future of the committee hangs in the balance. State government sources said that the Eknath Shinde government might dissolve the Pawar committee and appoint a new one to discuss the matter. 

Published on August 01, 2022
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