The revised payout includes a higher government incentive and is expected to benefit more than 316,000 milk producers supplying the state’s cooperative network
Tamil Nadu has raised the milk procurement price paid to dairy farmers by Rs 3 to Rs 41 per litre, with the revised rate expected to benefit more than 316,000 milk producers across the state. Chief Minister C Joseph Vijay announced the decision in the Assembly on Wednesday.
Under the revised structure, the procurement price paid through milk cooperatives will increase by Rs 1 per litre, while the state government’s incentive will rise from Rs 3 to Rs 5 per litre. Together, the changes will take the total procurement price from Rs 38 to Rs 41 per litre.
The higher payout will benefit milk producers supplying their produce to primary milk producers’ cooperative societies. The state currently procures around 3.4 million litres of milk each day from 3.16 million producers through 8,800 milk cooperative societies.
Aavin, Tamil Nadu’s state-owned dairy cooperative, sells around 3.1 million litres of milk to consumers each day.
Higher State Expenditure
The increase in procurement prices is expected to add Rs 30 crore to the state government’s monthly expenditure. On an annual basis, the additional financial burden will be around Rs 360 crore, Vijay said.
The move comes as the state seeks to provide higher returns to dairy farmers while maintaining its milk procurement network. The revised procurement price will apply to producers supplying milk through the cooperative system.
