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Amul MD Explains Why Milk Prices Will Go up Soon

According to the Amul MD, costs for packaging, shipping, and energy, all of which have an impact on the cost of cold storage, have increased by over a third.

Binita Kumari
The official went on to say that while farmers are benefiting from rising produce prices, inflation in his sector is not a concern.
The official went on to say that while farmers are benefiting from rising produce prices, inflation in his sector is not a concern.

Amul believes that prices may continue to be "firm" in the future as a result of rising pressure from energy, shipping, and packaging expenses, officials said on Tuesday. They added that they are unable to specify the exact amount of the price rise.

According to Sodhi, the cooperative has increased prices by 8% over the last two years, including a 2% increase in milk pricing per litre last month.

The official went on to say that while farmers are benefiting from rising produce prices, inflation in his sector is not a concern. The increases by Amul and the larger dairy industry are quite modest when compared to those of other companies or the increase in input costs, according to Sodhi.

According to him, costs for packaging, shipping, and energy, all of which have an impact on the cost of cold storage, have increased by over a third.

According to him, these pressures have caused a 1.20 increase in the price per litre of milk. He also emphasised that the pandemic has increased farmers' income per litre by up to 4.

According to Sodhi, the cooperative has used technological interventions, particularly in the area of supply chain management, to lower costs. He also noted that due to these constraints, profit margins have been squeezed at several companies in the industry.

He added that 85 paise of every rupee registered as revenue gets to the farmer, therefore Amul is unconcerned by such demands because profit booking is not the cooperative's main goal.

He added that Amul is actively testing its entry into the organic food industry and that the company is interested in any endeavour related to farming and agriculture.

"Hitherto, GST was exempted on specific food commodities, grains, etc. when not branded, or right on the brand has been foregone," the GST Council, which was chaired by Finance Minister Nirmala Sitharaman, stated in the 47th meeting about the withdrawal of exemptions. 

According to the Legal Metrology Act, the extent of the exemption should be revised to exclude items like curd, lassi, and buttermilk from its prepackaged and pre-labeled retail pack.

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