Problem of plenty: Milk procurement hit, prices to dairy farmers drop 20%

A private dairy based in the NCR said the market was flush with SMP and prices had fallen to Rs 150 a kg or so in the domestic market, down by 30 per cent

With stocks of skimmed milk powder (SMP) expected to touch 200,000 tonnes by March, there is a problem of plenty in the Indian dairy scene.

Cooperatives are already flush with 20 per cent more milk this season but capacities to convert this into SMP are stretched. The result is that procurement prices to farmers have already dropped by 20 per cent on an average. 

Milk cooperatives have requested the government to buy SMP (as buffer stocking) or announce an export subsidy (as international commodity prices are not conducive for exports). If not handled well, it would affect milk production next