Consumers facing inflation in the country may soon have to face increased prices of milk. According to dairy sector experts, milk prices are likely to increase by 3 to 4 percent during July and August.
Business News: Concerns regarding food inflation in India seem to be increasing once again. After weather experts predicted the possibility of El Nino and weak monsoon, the dairy industry has warned that the prices of milk and dairy products may see a rise in the coming months. Industry experts estimate that milk prices may increase by 3 to 4 percent during July and August.
India is one of the largest milk producing countries in the world and milk is one of the major food items in the daily needs of crores of families. In such a situation, a possible increase in prices may affect the domestic budget as well as food inflation.
What is El Nino and why does concern increase?
El Nino is a global climate phenomenon associated with an unusual increase in the temperature of the Pacific Ocean. It affects the weather patterns of many countries of the world. El Nino in India is often associated with a weak monsoon and below normal rainfall. When rainfall is less than expected, agricultural production starts getting affected.
Its effect is not limited to crops only, but animal husbandry sector also gets affected by it. Availability of green fodder decreases and pressure on water sources increases, which may affect milk production.
How is milk production affected?
According to dairy experts, adequate nutrition and water are extremely essential for milk yielding animals. In case of weak monsoon the cost of fodder increases as the production of green fodder decreases. Along with this, lack of water has a negative impact on the productivity of animals. When cattle farmers’ costs rise, they either reduce production or demand higher milk prices to offset the additional expenses. As a result, pressure on milk prices increases in the market.
Experts say that if rainfall remains below normal in major milk producing states, milk supply may be affected and the possibility of price hike may become stronger.
Dairy products can also be expensive
The impact of increase in milk prices will not be limited to milk only. The production cost of curd, cheese, butter, ghee, sweets and other dairy products may also increase. Food industry analysts believe that the increase in prices of dairy products can have a direct impact on hotels, restaurants and food processing industries. This may result in consumers paying higher prices for many everyday items.
Keeping in view the possible challenges, major dairy companies of the country have started preparations in advance. Many companies are working with cattle farmers on alternative feed management, water conservation and animal health programs. The industry says that at present the supply of milk remains normal and there is no immediate situation of any major crisis. However, in view of the changing weather conditions, companies are focusing on keeping the supply chain strong.
Comments are closed.