CHENNAI: Amid spiralling food consumption at homes on account of the COVID-19 lockdown, prices of Aavin ghee and butter are set to rise by Rs 20 to 30 per kg burning a hole in consumers’ pockets.
On Tuesday, the Tamilnadu Co-operative Milk Producers' Federation Limited (TCMPF) also known as Aavin increased the 1000 ml PET jar price of ghee from Rs 495 to Rs 515.
Similarly, the price of 500 grams of cooking butter increased from Rs 240 to Rs 250, said an order issued by the General Manager, Marketing, Aavin. The revised fare comes into effect on Tuesday.
The price of 1000 ml carton of ghee last was increased in September last year from Rs 465 to 490. Now the same product costs Rs 510 per litre.
“Both ghee and butter are not essential items. Our operational cost has increased as a result of which we are incurring additional expenditure. The price hike is marginal,” Aavin MD Vallalar told The New Indian Express.
According to official data, about 2.3 crore litres of milk are produced daily, of which 25 lakh litres are retained by the dairy farmers for their own consumption.
45 lakh litres are sold to hotels and tea shops, while 65 lakh litres are converted into milk products by private companies. 50 lakh litres are sold through retail shops.
Of the 40 lakh litres procured by Aavin, 27 lakh litres are sold to consumers, while the remaining 12 to 13 lakh litres are converted into milk products including skimmed milk powder, ghee, butter and other items. The share of Aavin milk products in the retail industry is 11 percent.
Until 2017, the demand for Aavin ghee remained high as it was cheaper by Rs 80 to 120 per litre. However, after Aavin increased the prices matching private companies in early 2018, the demand for Aavin products has slightly plunged in recent years.
“Sweet stalls and hotels mostly buy private ghee brands. Now, the private companies will increase the prices of their milk products,” said an industrial source.
S Kamaraj of Korattur, a regular consumer of Aavin products, said, “We prefer Aavin over other brands mainly because of quality and reliability. Such a product should be available at affordable rates during a pandemic while almost everyone is facing financial distress. Aavin should consider dropping the price hike.”