Pune: Major dairies from northern India and Maharashtra have cut procurement price of milk by 10% in the past fortnight, but consumers will not get any benefit of this price cut, said industry executives. The only relief for the consumers will be that there will not be any increase in milk prices for the next few months, they said.

Less than two months ago, a section of the Indian dairy sector had approached the central government demanding easing import of milk products such as skimmed milk powder (SMP) and white butter to tide over the “acute” shortage of milk in the country. However, prices of SMP and butter have fallen 5-10% in the past two weeks.

Industry veterans attributed the fall in prices to the weather aberrations and release of hoarded stock in the market. Due to the delayed onset of summer season, the demand for ice cream, curd, buttermilk and other beverages has yet not reached the level of peak summer demand, bringing hoarded stocks to the markets, said experts. In addition, demand was curtailed due to the 14-15% increase in prices of milk and milk products in the past 15 months.

Prices of white butter and skimmed milk powder have fallen 5-10% in the past fortnight.

“The winter season was extended, while there was a delay in summer due to the unseasonal rainfall. Consumers had reduced consumption as prices increased substantially. Thirdly, the demand for summer products like ice cream, curd, buttermilk, lassi and other milk-based beverages has yet not hit the peak summer demand in many markets of the country,” said RS Sodhi, president, Indian Dairy Association.

Private dairies in states like Maharashtra and parts of Punjab, Haryana and Uttar Pradesh, which surround Delhi, have taken a hit because of the fall in prices of SMP and butter. As a result, the procurement price of milk has been cut by ₹3-5 per litre in these states. The price of SMP is down ₹20-30 per kg to ₹290-310 per kg, while the price of butter has fallen ₹25-30 per kg to ₹390-405 per kg in the past fortnight.”Consumers will not have to face any further increase in milk prices. The correction in milk procurement prices from the very high levels is a win-win situation for the farmers, consumers as well as the dairies,” said Sodhi.