CHENNAI: In what appears to be an attempt to encourage the sale of Aavin milk more through societies than retail outlets, the State’s co-operative milk producers federation has made full cream milk (orange) cheaper for monthly cardholders by Rs 14 a litre.
The price of full cream milk, which accounts for 21 per cent to 22 per cent of the market share of Aavin, had been increased from Rs 48 to Rs 60 a litre on Friday, except for cardholders. Normally, the price difference between cardholders and retail shops is only Rs 2 to Rs 3 per litre.
The price hike followed an increase in procurement price for cow and buffalo milk each by Rs 3 per litre from Saturday. After revision, the procurement price of cow milk is Rs 35 a litre and buffalo milk is Rs 44. The price hike will benefit 4.5 lakh milk producers, said Aavin in a statement.
Incidentally, prices of toned (blue) and standardised (green) variants of Aavin will remain unchanged for both retail sales and cardholders. The current prices are Rs 40 and Rs 44 a litre respectively. Aavin procures 40 lakh litres of milk a day of which 30 lakh litres are sold through societies and retail outlets and the remaining is converted into milk products.
Aavin sells full cream milk (6.5 to 7.5 lakh litres), standardised milk (11.5 lakh), toned milk (8 to 8.5 lakh) and three other variants (UHT), tea-mate and gold for tea shops and hotels. Currently, only 25 per cent to 30 per cent of milk is sold through monthly cards despite its being subsidised by Rs 60 to Rs 90 a litre per month. Cardholders pay the price of milk 30 days in advance.
In August 2019, the milk procurement price was increased by Rs 6 a litre and the selling price by Rs 4. On May 16 last year, after assuming office, the DMK-led government slashed the per litre milk selling price by Rs 3, thereby bringing down the cost of milk to Rs 40 (toned), Rs 44 (standardised) and Rs 48 (full cream).
“The price hike will not affect the general public as only the price of orange milk, which is consumed by commercial players, has been increased,” said SM Nasar, Minister of Milk and Dairy Development, on Friday. The price of private milk brands of the same variety stands at Rs 70 a litre, he said.
N Subbaiyan, Managing Director, Aavin, said due to the hike in procurement price, the federation will incur additional expenses of Rs 36 crore per month.
“The price hike of full cream milk will help us to meet 50 per cent of additional expenditure. The remaining 50 per cent deficit will be met by enhancing the sale of milk products. The government has also promised to compensate Aavin for the loss,” he said.
‘Roll back of price hike’
AIADMK leader O Panneerselvam on Friday condemned the premium milk price hike by Rs 12 a litre for those who buy from retail outlets and Aavin stores and urged the Tamil Nadu government to roll it back as it would affect prices of tea and coffee.
Panneerselvam said people suspected that the government would hike the prices of other varieties of Aavin milk soon. Farmers and milk sellers had demanded a hike in the procurement price of Rs 10 a litre. But they have been given a hike of only Rs 3 a litre.