Banas Dairy Announces Rs 1,650-cr Price Difference for Milk Producers

Harjibhai Chaudhary, a milk producer in Thavar village in the Banaskantha district of North Gujarat, is overjoyed because the district dairy union, Banas Dairy, announced a price difference for its 5 lakh milk producer members on Monday.

The board of directors of Banaskantha District Cooperative Milk Producers' Union Ltd (Banas Dairy) announced a 19.12% price difference for every milk pourer member of the Union at the 54th Annual General Meeting (AGM). Harjibhai Chaudhary and his son Vipul at their farm in Thavar village of Banaskantha district's Dhanera taluka.

This means that Harjibhai, who supplies (pours) about 150 litres of milk per day from his 10 Holstein Friesians (HF) cows, is entitled to a 19.12% premium over the value of the milk he supplied in fiscal 2021-22. Throughout the year, Harjibhai provided milk worth Rs 14 lakh.

Similarly, Hansaba Chavda, 64, of Joita village in Vadgam taluka, has a 19.12-percentage-point income of Rs.17.78 lakh. The reason: Chavda supplied milk worth Rs 93 lakh from her 45 cows during the fiscal year. "Every year, we eagerly await the announcement of the 'bhav fer' (price difference) at the AGM. This motivates me to continue dairying," said Chavda, who has been in the dairy business for over 15 years and now employs milking machines and labourers at her cow-shed. Her farm produces approximately 800 litres of milk per day on average.

On Monday, while speaking to a large crowd of over 5,000 milk producers on the outskirts of Palanpur, the district headquarter of Banaskantha, Shankar Chaudhary, Chairman of Banas Dairy, said the 19.12% price difference for the year 2021-22 would amount to Rs. 1,650 crore, the highest sum ever. The dairy had given a price difference of Rs 1,132 crore in the previous year, 2020-21, while it was Rs 1,144 crore in 2019-20.

The price difference is the additional compensation paid to milk producers over and above the milk procurement price. Additional revenue is generated by the sale of value-added and non-dairy products. Profits from the sale of these products are calculated and distributed among dairy members at the end of the year. "The entire amount will be deposited directly into the milk pourers' bank accounts within the next 15 days," Chaudhary said.

Milk producers deliver milk to the village milk society twice a day, in the morning and in the evening. "Banas Dairy pays the highest price difference among all other dairy unions in Gujarat," Chaudhary said. Parshottam Rupala, Union Minister for Fisheries, Animal Husbandry, and Dairy, stated in his address, "Banas Dairy has set an example for the rest of the country to follow. Many others in the country are inspired by its remarkable achievements in milk and honey procurement."

The capital of the dairy union has increased from Rs 244 crore in 2013-14 to 848 crore in 2021-22, while assets have increased from Rs 879 crore to over Rs 3,500 crore during the same period. And revenues have increased from Rs 4,687 crore to Rs 15,255 crore. During the year, Banas Dairy recorded a record daily milk collection of 90.58 lakh litres, with an average procurement of 74.04 lakh kg.

(Source: BusinessLine)