This increase in consumer pricing is attributed to the increasing production costs. The production costs have been on the rise for over a year, Mother Dairy said in a press note. They also said that consumer prices were kept stable despite increasing costs of milk procurement over the last few months. The increase in farm prices is partially passed on to the consumers, affecting the MRP by 3-4%, Mother Dairy added.
“The increase of Rs 2 per litre translates to the range of 3-4 per cent increase in MRP which is much lower than the average food inflation,” the Gujarat Cooperative Milk Marketing Federation (GCMMF), which markets milk and milk products under Amul’s brand name, said.
Reserve Bank of India (RBI) mentioned in its annual report that the increased prices of food and beverages (F&B) category have been a major driver of India’s inflation in FY24. F&B’s contribution to the headline inflation was 60.3% in FY24, up from 46% a year ago.
The prediction of the CPI inflation by the central bank for FY25 is at 4.5%.Both, Mother Dairy and Amul had last revised the prices of liquid milk in February 2023.Due to the ongoing heat stress in the country, Mother Dairy said that there could be further impact on milk production.
Mother Dairy stated that around 75-80% of its sales from milk is passed towards its procurement to ensure the sustenance of dairy farming. GCMMF also stated that almost 80 paise of every rupee paid by the consumers for milk and milk products is passed onto the milk producers.
