The on-going pandemic adversely impacted dairy farmers due to the lowering of the procurement prices. Thus, the depressed Maharashtra dairy farmers resorted to dumping milk on roads and stopping supply to urban areas as a sign of protest.
Dairy Farmers in Deep Distress
Since April, the prices paid to farmers for milk production has steadily decreased due to the pandemic lockdown. Accordingly, in Maharashtra, the prices came down from Rs. 30 per litre for milk with 3.5 % fat and 8.5 % SNF (solid non-fat) to just Rs. 17- 22.50 per litre. Further, farmers have no choice but to sell at a fixed price as milk is a perishable commodity. Over 50% decline in milk price would have an adverse effect on their livelihood. Thus, the dairy crisis has become a political dispute in the state.
Farmers Seeking Higher Procurement Prices
Demanding higher procurement price and subsidies, Swabhimani Shetkari Sanghatana (SSS) started a “milk agitation”. Consequently, a meeting was held between the members of SSS and AIKS (All-India Kisan Sabha) along with the state dairy development minister, Mr Sunil Kedar. Unfortunately, the meeting did not yield favourable results. Further, the opposition in the state has also demanded Rs. 10 increase in the procurement prices. Failing to do this, they warned that they would go on a strike from 1st August.
On the other hand, Mr Kedar has assured that the problem will be sorted soon and that the interest of all the parties would be taken care of.
Subsidy for Dairy Farmers
The Maharashtra government has offered a subsidy of Rs. 5 per lire to the struggling farmers. Following this, the SSS called off the one day strike. Despite cancelling the protest, they put forth more demands.
The State President, Mr Sandip Jagatap Kavi, urged the centre to halt the import of 10,000 tonnes of skimmed milk and create an SMP buffer stock of 30,000 tonnes. Further, he called for an export subsidy of Rs. 50 for shipments outside India. Also, he warned that officials would face severe charges if the demands are not met in due time.
Dairy stocks- a Safe Bet?
Dairy stocks have seen a positive gain during the lockdown. In fact, they have seen a V-shaped recovery and now are in a steady consolidation phase. Accordingly, Parag Milk Foods has seen a jump of 87% in the last four months, and Heritage Foods has jumped up by 84%. Thereby, estimates suggest that dairy stocks will perform well despite the reduction of sales and demand from the consumers as well as the hospitality sector.
In all, the dairy farmers plight must be understood and dealt within the country. Farmers have been suggesting subsidies similar to the Rs 5 per litre subsidy for a long time that must be considered. It is essential that the government actively takes part in improving their livelihood.