Explained: Why are milk prices rising?

Milk prices have increased several times over the past year. Until February of last year, whole milk to Delhi-NCR it costs Rs 58 per litre, while tonic milk it costs Rs 48. As of February 2023, and the price of whole milk has risen to Rs 66 per liter and toned milk costs Rs 54 per litre. So why are milk prices rising and will they continue to do so in the coming months?
RS Sodhipresident of the Indian Dairy Association and former managing director of Amul India says rising milk prices directly benefits farmers. In this week’s episode of TOI Business Bytes, Sodhi talks about the crisis for consumers and how long-term milk prices will rise in line with general inflation.

“Over the past few months, milk prices have increased by 14 to 15%, much more than inflation. But if you look at the last three years, it is less than 7%. 10 years ago, whole milk prices were 42 rupees There was a 52% increase. But this is a supply-demand situation because during COVID farmers suffered from lower demand. Last year, input prices, i.e. the cost of feed, increased by 20 to 25 percent,” explains Sodhi.
Sodhi is of the opinion that by 2047, India will produce 620 million tons of milk, which will account for 45% of the world’s milk production. Highlight the important announcements of the Minister of Finance Nirmala Sitharaman for the cooperative sector in his Union Budget 2023 speech. “I think the government has understood the need for cooperatives and by giving due prominence to the budget, I think many more will come,” he told TOI.
Sodhi also talks about the future of Indian dairy sector and the need to invest in the White Revolution 2.0. Watch the video above to hear RS Sodhi’s insightful views on milk prices and the way forward for the Indian dairy sector.