Dairy farmers target bulk consumers directly for better realisation

Move poses a threat to dairy firms, who are mulling two options -- pare selling price for bulk users or expand margins with lower sales volumes

The Rs 6,000-billion dairy industry in India has gone through a dramatic shift in milk supply over the past few months, with farmers initiating direct supply to retailers and bulk consumers to fetch better realisation, instead of supplying to organised collection centres under a corporate brand.

Targeting mainly the hotels, restaurants and catering (HORECA) segment, the new system of milk supply is posing a big threat to dairy companies over milk availability during  the short term and sustained supply for future projects.

The new supply mode started in Andhra Pradesh, with dozens of farmers joining hands with Farmers Produce Organisations (FPOs) and