Milk retailers in the resort town of Shimla in Himachal Pradesh have entered into a deal with the state run Himachal Pradesh State Co-op milk producers federation (Milkfed).
Starting Monday, retailers will promote and sell the local and cheaper Milkfed milk, which will also offer them a higher margin.
Currently, bulk of the milk in Shimla is met by milk producers from outside the state including Verka,Vita, Reliance, Mother Diary among others.
Retailers say despite increase in the milk prices by these companies many times over the last one year the benefit has only gone to wholesale milk producers.The current price of most of the milk is Rs 32 a litre.
But the locally produced Milkfed milk is selling at Rs 28 a litre. By entering into an agreement with Milkfed, retailers will get a larger profit and even the buyer will pay a lesser price for milk.
Currently private companies offer only 25 to 50 paise per litre to retailers while Milkfed will offer them a margin of Rs 2 per litre.
On the other hand, Milkfed has plans to raise its production. At present, it has only a 20 per cent market share. Around 50,000 litres of milk is consumed in Shimla daily.
