Due to a bumper output, milk farmers in several parts of the country are up in arms against falling prices of their produce.
Latest data from the Central Statistics Office (CSO) show that in terms of value of output, livestock products, which mainly comprise milk, meat, and eggs, have shown one of the fastest growths between 2011-12 and 2015-16.
According to the latest state-wise and item-wise estimates of value of output from agriculture and allied sectors (2011-12 to 2015-16) by the CSO, at constant prices (2011-12), together with fish, the value of output of the livestock sector grew by almost 56 per cent between 2011-12 and 2015-16. In comparison, the broader agriculture crops, which include cereals and horticulture, grew by less than 1 per cent during the same period.
While the data does show a trend in the production of major agriculture produce, including livestock and forest produce, at constant prices. In agriculture crops, as compared to cereals, oilseeds, fibres and other crops, the value of output of the fruits and vegetable segment grew at a faster pace between 2011-12 and 2015-16.
Between 2011-12 and 2015-16, the share of fruits and vegetables in the overall value of agriculture crops has also risen from 23 to 26 per cent.
The data also showed that India's total value of output for agriculture and allied activities, at constant prices, has risen from Rs 190.81 billion in 2011-12 to Rs 207.08 billion in 2015-16.
Milk prices in most parts of India have crashed from around Rs 28-30 a kilogramme last year to less than Rs 20 mainly due to surplus stocks of skimmed milk powder (SMP), which has limited the dairies' ability to purchase.
Currently, the country is saddled with almost 150,000 tonnes of SMP, which needs to be shipped out ahead of the flush season that starts from October or else prices might crash further. Though the government has announced a subsidy of 10 per cent to export SMP, farmers have said that this was grossly inadequate as international prices have virtually crashed.
"We want direct subsidy of Rs 5-6 per litre for farmers and the extent of subsidy on SMP exports should be raised to 50 per cent, while GST (goods and services tax) on milk products should be withdrawn, or else farmers will suffer," said Daljit Singh Sadarpur, president of the Progressive Dairy Farmers Association, which was leading the agitation in Delhi.
In a note, research firm India Ratings said that recent policy measures of increasing import duty on whey and offering subsidy to milk farmers would provide a marginal relief to the dairy sector and the sector would continue to reel under the pressure of high SMP inventories and low prices, so long as the global market for SMP and casein does not revive.
Source: https://www.business-standard.com/
