Some Tamil Nadu-based dairy farmers have threatened to withdraw fresh milk supply if they cannot reach an agreement with the state government over the procurement milk price. The farmers, who supply the Tamil Nadu Cooperative Milk Producers Federation (Aavin), India’s fourth largest milk co-op, demand a raise of Rs7 ($0.085) per liter. The co-op currently pays Rs35 ($0.42) for a liter of cow’s milk and Rs44 ($0.53) for a liter of buffalo milk, and farmers say they are getting better prices from the private sector, where firms pay Rs42 for cow milk and Rs46 per liter of buffalo milk. Tamil Nadu officials deny that the protests have caused milk shortage in the South Indian state.
British consumers are choosing cheaper brands of fresh milk to cope with inflationary pressures. According to research commissioned by AHDB, only 27% of UK consumers have chosen to reduce dairy consumption for cost reasons. But there’s evidence that shoppers are trading down - data from Kantar reveals a -15.5% yearly decline in branded milk sales in December 2022, while private-label milk sales increased 25%. A similar trend is occurring in the milkfats market, where branded butter volumes have declined -7.5% compared to -4.4% for private label products. Spreadables also saw a gap between own-label and branded volumes in December 2022, with branded products down 18.3% and private up 30.4% year on year. Branded yogurt volumes were down -12.1% compared to an increase in private-label volumes of 8.6%. Cheese was the only outlier, with volumes declining by just -1.3% in the 12 weeks to December 25, with feta sales growing by 27%, likely on the back of social media trends in the run-up to the winter holiday season.
US exports of non-fat dry milk and skimmed milk powder were up 14.8% year on year in January 2023, driven by Mexican imports. Whey and cheese also had double-digit growth, whey exports driven by improving demand from China and cheese exports recording a 16% increase in volumes exported in January. Overall, 25,026 tons of dairy product was exported in January, up 16% year-on-year in volume and 21% in value, which equates to a rise of $121.4m.
