Prices of milk products fall 22% in 1 month

Prices of skimmed milk powder (SMP) and desi ghee have declined 20-22 per cent, on an average, over the last one month on account of low post-festive season demand and improving milk supply.

In Delhi, prices of various brands of SMP have slumped more than 20 per cent during the past month. The price of Madhusudan SMP, for instance, has fallen to Rs 104 a kg from Rs 128 a kg on October 20.

Prices of pure ghee, too, have dropped to Rs 1,935 a tin (15 kg) from about Rs 2,450 on October 20, indicating a fall of about Rs 34 a kg in just one month. Param premium ghee, which was quoting at Rs 2,470 a 15-kg tin a month ago, is now selling at Rs 1,935.

"During Diwali and Eid, there was huge demand for khoya and ghee, which go into making of sweets and other delicacies. This induced a rise in milk prices to a high of Rs 18-20 a kg. As a result, prices of milk-based products also increased," said Brijesh Gupta, vice-president, Param Dairy Products.

"With the end of festivals, milk prices have fallen to Rs 14-16 a kg," he added.

Rajiv Batra of Pal Agro Industries said, "With the onset of winter, milk output increases and so does milk supply to processing factories. Therefore, prices of milk products see a decline."

Industry sources anticipate that ghee prices will decline further by about Rs 5 a kg by the end of the year. However, according to them, prices of SMP variants will stabilise at the current rate of Rs 102-105 a kg.

This was because there was rising export demand of milk powder at these rates, the sources said. Prices of SMP might go up in January next year when stockists would buy in large quantities for their year-long supply as the quality of milk was better around that time, they said.