KOCHI: The slowdown in economic activities following the demonetisation has affected retail sales of milk in the State.
Milma, the leading milk supplier in Kerala, witnessed a surplus of nearly one-and-half lakh litres soon after the Centre withdrew high-value currency notes last week. Though the surplus eased in the days that followed, Milma officials are of the view that unless the currency crunch is not resolved, the volume of surplus would go up in the coming days.
The demonetisation has also affected the dairy farmers, and most of them have not been receiving their payment.
“The main reason behind the present crisis is that households have put curbs on their purchases. The purchasing power and consumption pattern depend mainly on the flow of money to the common man. Because of the sudden change in the purchasing pattern, the sales volume dropped to an all-time low soon after the demonetisation drive, which resulted in the surplus. But, Milma has taken adequate steps to resolve the surplus issue to a great extend,” said Milma-Kozhikode managing director K T Thomas.
Milma is operating in association with three regional unions of milk producers, of which the Thiruvananthapuram and Ernakulam unions procure milk from neighbouring states also.
“Soon after the demonetisation, the Thiruvananthpuram and Ernakulam unions took steps to stop milk procurement from the other states, and the surplus milk from the Malabar union was supplied to the other regional unions. We have also taken steps to revive the milk-powder plant at Punnapra in Alappuzha, so that the surplus milk could be converted into milk power,” he added.
Usually, the regional unions transfer payments to the bank accounts of cooperative milk societies - Kerala Grameen Bank, Canara Bank, Union Bank, State Bank and District Cooperative banks.
“Under each society, there are 300-400 dairy farmers. The societies pay them by cash once in ten days, because the majority of the farmers demand cash payment. Now, the societies are insisting on paying the farmers through bank. There are practical difficulties in transferring cash to the farmers online, with maintaining the transaction details of 300-400 persons being the biggest challenge. It is not feasible to pay by cheque also, considering the large number of cheque leaves required,” said office-bearers of the society.
Under the Ernakulam union, there are around 857 primary milk producers’ societies, procuring around 46,200 litres of milk every day. If the present crisis persists, milk production by the unions would fall drastically in the coming days.
“Due to improper payment, farmers find it difficult to purchase cattle-feed, and some of them have already sold their cattle. Only farmers who are in urgent need of cash are paid now,” said Maneed Cooperative Milk Society secretary James K Varghese.