‘Madurai Aavin set to lose over Rs. 1 crore every month’

Following a revision in milk procurement price, which will come into force from January 1, 2014 many Aavin unions in Tamil Nadu, including Madurai, are set to incur additional financial burden, official sources said here on Wednesday.

Out of the 17 Aavin unions functioning across the State, except those in Madurai, Coimbatore, Tiruchi and Salem, which are making profits, the rest which include Dharmapuri, Virudhunagar, Nilgiris, Kancheepuram and Tiruvallur Aavin are incurring losses, sources said.

As a result of the announcement made by Chief Minister Jayalalithaa a few days ago, Aavin unions like the Madurai Union is likely to lose a sizable portion of its profit. For instance, Madurai Aavin, which procured close to 1.60 lakh litres of milk daily, would have to pay Rs. 3 a litre in addition to the present price from January 1. It means, it would have to pay Rs. 48,000 more a day, which works out close to Rs. 1.50 crore, a month. Currently, the Madurai Aavin reported a monthly profit of Rs. 2.50 crore. In the case of loss making Aavin union, the officials would have to examine the modalities to honour the commitment to the milk producers.

A top official from Aavin Chennai, who spoke to The Hindu over telephone, said that from the 17 Aavin unions in the State, around 21 lakh litres of milk was procured daily. Apart from producing standardised milk, the Aavin produced ghee, butter, sweets made of milk, among others. After the milk producers’ union representatives had demanded a revision in procurement prices, the government had hiked the price, despite limitations, in the larger interest of farmers, he noted. Senior office-bearers affiliated to various trade unions including the CITU in the Aavin, however, said that the ‘unilateral’ decision to hike the procurement price without taking into account the financial capabilities would result in more loss, especially, of those unions which were reported to be sick. Alleging lack of enforcement of rules and political interference in the general administration, members said that the government might ultimately hike the selling price of milk after the general elections as it did in 2011 after the local body elections. That the milk producers are unhappy with the revision is a different story.

More In: Madurai