And now, milk price set to increase in Karnataka

January 14th, 2011 - 9:29 pm ICT by IANS  

Bharatiya Janata Party Bangalore, Jan 14 (IANS) After onions and vegetables, the retail milk price across Karnataka is set to go up by Rs.2-3 per litre next month if the state-run Karnataka Milk Federation (KMF) has its way.”We have apprised the state government on the need to increase the milk procurement price to compensate producers from rising costs and inflationary pressure. We will decide the quantum of increase in retail price next month,” KMF Chairman G. Somashekar Reddy told reporters here Friday.

Currently, the federation pays Rs.18.50 per litre, including a subsidy of Rs.2 from the state government to milk producers and dairy cooperatives across the state.

With 4.2 million litres per day during the peak season at a cost of Rs.60 million (Rs.6 crore), Karnataka is the second largest producer of milk in India after Gujarat.

The federation sells milk under “Nandini” brand at Rs.19 per litre for toned (lowest) variety, special (double toned) at Rs.24 per litre and special milk with cream at Rs.26 per litre through its retail outlets, vending machines and franchise across the state.

“Chief Minister S. Yeddyurappa told us that he would revert in a month on our proposal to give Rs.20 per litre to producers. The increase in retail price will be decided in consultation with the government,” Reddy said on the sidelines of a function on the eve of the Makar Sankranti Saturday.

The federation, which procures milk through 13 producers’ cooperatives, has 65 percent market share in the state, with around three million litres sold per day and the remaining 1.2 million liters exported to neighbouring states such as Andhra Pradesh, Maharashtra and Tamil Nadu, besides Singapore.

“We are aware that consumers are reeling under steep food prices. At the same time, milk producers, majority of whom are marginal farmers and women, are forced to spend more for fodder, grass and other overheads, including higher transportation cost,” Reddy pointed out.

Asserting that Nandini milk price was the lowest in the country, Reddy said the federation was currently getting Rs.2.50 out of the Rs.19 per litre from retail sales, as producers are paid Rs.18.50, with Rs.2 subsidy from the state government.

“If we have to help producers, we need to pay more to ensure milk output during the lean season (March-May) does not fall below 2.8 million litres per day,” he explained.

Reddy, a legislator of the ruling Bharatiya Janata Party (BJP) from the rich mining district of Bellary in north Karnataka, is the younger brother of the duo Reddy ministers - G. Karunakara (revenue) and G. Janardhan (infrastructure & tourism).

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