India's leading dairy firm Amul on Saturday announced hiking milk prices by Rs 2 per litre across various states, while Mother Dairy increased rates by up to Rs 3 per litre in Delhi-NCR due to rise in procurement cost.
The new prices will be effective from Sunday (December 15), Mother Dairy and Amul said in separate statements.
Prices of raw milk are generally lower in the winter season, but this year they have risen due to late monsoon followed by excess rains.
Increase in milk prices by the two major dairy firms could impact retail inflation, which spiked to a more than three-year high of 5.54 per cent in November due to costlier food products.
Mother Dairy has increased prices of token and poly pack or pouched milk by Rs 2-3 per litre.
Gujarat Cooperative Milk Marketing Federation (GCMMF), which markets dairy products under the Amul brand, said it has decided to revise milk prices by Rs 2 per litre in Ahmedabad and Saurashtra markets of Gujarat, Delhi NCR, West Bengal, Mumbai and Maharashtra.
GCMMF supplies 1.4 crore litres of milk per day across the country, of which 33 lakh litres is in Delhi-NCR.
Mother Dairy too sells over 30 lakh litres per day of milk in the national capital region.
Both the dairy majors attributed the price increase to higher procurement cost and said they pass on 80 per cent of the sales realisation from milk towards its procurement from dairy farmers.
As per its rate chart, Mother Dairy has hiked the price of bulk vended milk (token milk) by Rs 2 to Rs 42 per litre.
In poly packs, Mother Dairy's full cream milk has become costlier by Rs 2 to Rs 55 per litre. Price of half litre full cream milk has been hiked to Rs 28 from Rs 27.
Mother Dairy's toned milk price has been hiked by Rs 3 per litre to Rs 45, while double-toned milk will now be sold at Rs 39 per litre compared to Rs 36.
Price of Mother Dairy cow milk too has been raised by Rs 3 per litre to Rs 47 per litre.
In NCR, Amul Gold and Amul Taaza will be costlier Rs 2 each to Rs 55 per litre and Rs 44 per litre respectively. Cow milk will now be sold at Rs 44 against Rs 42 per litre earlier.
Amul said that in the last three years, it has made only two price revisions for pouch milk which is only Rs 4 per litre and less than 3 per cent per annum increase in MRP.
"This year the price of cattle feed has increased by more than 35 per cent. Considering increase in cattle feed and other input costs, our member unions have increased milk procurement price in the range of Rs 100 to Rs 110 per Kg fat which is more than 15 per cent increase than the last year for the 36 lakh milk producers of Gujarat," Amul said.
Mother Dairy said that milk availability across various states is under severe stress due to adverse climatic conditions including extended monsoon and delayed start of the flush season.
Stating that adverse climatic conditions have resulted in a significant increase in feed and fodder prices, Mother Dairy said: "This has impacted the prices paid to milk producers. The raw milk prices, which in a normal year come down during the winter months, have firmed up substantially."
The prices paid to milk producers have increased by about Rs 6 per litre, up by almost 20 per cent compared to the corresponding period last year, the company said, adding that it was compelled to raise milk rates.