Saturday, December 16, 2017

It has never been so serious before : Milk Strike (51st Dairy Pulse, 1 to 15 Dec, 2017)

Dear Friends,

Last fortnight ended up on an acrid note with numerous farmers unions in North India in UP region went on a day's long milk strike and also threatened those involved in sales and transportation of milk , on December 15th.Though no untoward incident was heard but the message got clear.

The farmers in other parts of the country are likely to follow the suit and may be soon we might see a nationwide strike by dairy farmers. On one hand it might bring a lot of loss to these farmers as well as national loss in terms of product loss while on the other hand , the plant owners as well as consumers might face some short supplies in this so called flush season.

Now who is to be blamed ? Farmers, processors, intermediaries , global trends or government. I do not have answer but let us look at everyone's perspective.

Farmers : They do not have a say in deciding price of milk rather they hardly know their cost of production  in most of the cases.

Processors : They normally follow demand  supply model to fix the price of milk and keep on reducing the price so as to discourage farmers to give milk to them in case of over supplies ( barring a few cooperatives and large dairies).

Intermediaries : They somehow have certain vested interests and they make best use of such circumstances by exploiting the milk eco system both ways.

Global trends : The trends are still not very positive for skimmed milk powder as well as farm gate price of milk. Butter and AMF may be a sigh of relief for Indian exporters currently but the trend still needs to be watched on year end and early next year.

Government : Since 1991 when dairy got delicensed , the government has slowly and steadily kept it self at bay when it comes to milk pricing , milk sheds and purchase price of milk from the farmers. Rather government has tried to create a lot of exit barriers right from the farmers to other stakeholders  over a period of time in different forms.

Since 1991, no policy has been drafted to define ownership of any given milk shed both in terms of quantity of milk to be collected and traded and prices at which it makes sense for farmers to be in this trade.

Milk has been  the top agri commodity in the country. Cereals and grains have been following it since last few years in terms of value. Milk is also the fastest cash flow generating livelihood activity for dairy farmers and especially women farmers. Still nothing much has been done in terms of developing cold chain and storage infrastructure and supply chain mechanism near to to farmers doorstep on the lines of FCI. Neither any initiative on fixing MSP of milk has been thought of nor any mechanism for milk price fixation for consumers .

Farmer's agitation is valid as they see the processors buying milk at as low as 28-30 per liter for buffalo milk without any change at the consumer level at Rs 52. What at the most has been offered by government is simply subsidy on milk purchase and subsidizing ailing cooperative structure in different states . Which may be  good but not sufficient for sure.
I think its high time for all stakeholders to think out of the box and look out for sustainable solution to such perennial problem of milk pricing during flush and lean.

First National Level Resource Person workshop was organized at FSSAI headquarters New Delhi on Dec 13 to kick off the nationwide drive to conduct  Food safety supervisor training program . This program will be carried out under the FoSTaC ( Food Safety Training and Certification) initiative of FSSAI. The meeting was represented by key stakeholders like Amul, Mother Dairy, NDDB, Verka, Nestle, ITC, Paras, Ananda etc along with Team FSSAI. 

So now with the last fortnight of the year progressing, I promise to meet you in next year with good wishes and some other interesting news and views.  

Happy e reading

with best regards

Kuldeep Sharma
Chief Thinking Officer
Suruchi Consultants (ISO 9001:2008 Company)
C-49 Sector-65
Noida 201307

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