Gujarat Co-ops Go All Out to Woo Farmers

INDIA - If you thought elections just milk the state exchequer dry, think again. The democratic exercise, often termed unproductive by cynics, has at least raised the milk procurement prices to record levels in Gujarat. The prices, which are hovering at Rs 310 have surpassed even the summer peak prices of Rs 240 per kgfat (Mehsana union prices).

14 November 2007

1 minute read

Asia

Gujarat has a milk producing fraternity of 25 lakh farmers. Add the family members, and the fugure translates to whopping one crore voters. The total number of voters in the state is around 3.66 crore. Looking at the massive vote bank, the cooperatives have avoided reducing prices despite seasonal compulsions.

Assembly polls in Gujarat are slated for December 11 and 16, a time during which milk prices crash owing to winter.

It’s pure economics — abundant supply of grass during the season leads to heavy production of milk. With supply overtaking demand, prices crash. Historically, milk prices drop by 15-20% during winters as compared to the peak prices during summers. Production drops during summers and prices soar.

This year milk procurement by dairies affiliated to Gujarat Cooperative Milk Marketing Federation (GCMMF) is hitting the roof just a month before the assembly polls.

Source: Economic Times