Bengaluru remains unaffected by the milk price hike

Bangalore Business Karnataka

Amul and Mother Dairy increased product prices for the third time in October.

Rising milk prices in the country have not affected the sale or consumption of milk and milk products in Bengaluru. “There is no change in the sales record of my store,” says Hemanth V, a Nandini outlet handler in Indiranagar. He added, “Prices have increased for some Nandini products such as flavoured milk, curd and packaged sweets but sales have not been affected.”

Both Amul and Dairy Milk have increased prices this year— once in March, in August and now, in October. Reports say Amul has increased prices for Amul Gold (full cream) and buffalo milk whereas Mother Dairy has increased the cost of full cream and cow milk in North India from Oct. 16. The reasons for the hike were cited as the increased cost of production and transportation.

Gajendra Nataraja, the owner of a Nandini store in Mahadevapura reports a similar situation. He said, “Price changes for brands such as Amul do not affect the market in Bengaluru. Nandini is the number one brand here with the highest sales.”  Nataraja continued that the customer base is more than satisfied with the quality of more than 170 Nandini products. “A minimal increase of 10 – 15 percent is justified for the good quality.”

A customer at the store said that price hikes are normal. She said, “It is only a problem if it happens too often or by a large margin.”

Anil Kumar K C, Marketing Assistant at Bengaluru Milk Union Limited (BAMUL) said that the organisation runs on a no profit, no loss policy. “Price hike in production has also affected our producers but we have tried to make sure that the consumers are not affected by it,” he said.

Dr. Hippu Salk Kristle Nathan, Associate Professor at the Institute of Rural Management, Anand said, “A collective such as Nandini is an organisational entity that gives greater bargaining power to the small producers. It looks after the needs of the rural economy and development.” He said there are experts and trained professionals in the organization that make sure that the producers’ quality of life improves.

There are several measures taken by BAMUL to keep the farmers happy. Kumar said, ”Subsidized cattle feed is being given to the farmers. Also, the purchase rate from the farmers has been increased by Re. one per litre.” Any price raise has to be approved by the government. 

In September 2022, the Hindustan Times reported that the Karnataka Milk Federation (KMF) had proposed to the government to raise the prices of Nandini milk by Rs. 3/litre. The New Indian Express had similar reports. KMF raised the proposal again in November but it was turned down by the government. Chief Minister Bommai announced that the final decision will be made after Nov. 20.

A store owner in Koramangala, Divya reported an increase in sales. She said, “Sale numbers have increased despite the rise in the cost of items like sweets, paneer, poha and buttermilk. The cost of half-litre ghee has gone up from 285 to 305.”

However, not every store is fortunate enough to experience higher profits. Chandrashekhar G, a store owner in Indiranagar witnessed a drop in demand. “The cost of a sweet box has gone up from 120 to 140. People hear or see the price and no longer want to buy the product,” said Chandrashekhar.