Winning Bizness Desk
Mumbai. The Gujarat Cooperative Milk Marketing Federation (GCMMF), which manages the Amul brand, has reduced the prices of its milk variants by ₹1 per liter across the country. Jayen Mehta, Managing Director of GCMMF, announced that the price cut applies to Amul Gold, Amul Fresh, and Amul Shakti milk. The revised prices, effective from January 24, are ₹65 per liter for Amul Gold and ₹53 per liter for Amul Fresh.
Previous Price Hikes Linked to Inflation and Production Costs
Last year, ahead of the Lok Sabha election results declared on June 4, the prices of Amul milk were increased. Amul Gold saw a ₹2 per liter hike, while Amul Shakti and T Special also became more expensive. At the time, GCMMF attributed the increase to rising operational and production costs, explaining that the hike was limited to 3-4% of the overall MRP, which was lower than prevailing food inflation rates. Notably, there had been no price changes since February 2023 before this reduction.
Amul’s Three-Tier Model: Empowering Farmers
Amul operates on a unique three-tier cooperative model:
1. Dairy Co-operative Society: Milk producers in villages are members of these societies.
2. District Milk Union: Representatives from these societies manage the union, overseeing milk processing.
3. State Milk Federation: GCMMF markets and distributes the processed milk products nationwide.
This model ensures that profits reach the grassroots level, with approximately 86% of revenue going to farmer members and 14% used for cooperative operations.
Massive Operations Supporting Millions
Amul's scale is staggering, with over 18,600 cooperative societies and 36 lakh farmers in Gujarat producing millions of liters of milk daily. The collection process starts at 5 a.m. at village centers, where milk is measured, tested for fat content, and logged digitally. Payments, determined by milk quality and quantity, are made directly to farmers’ bank accounts via an app, ensuring transparency.
Focus on Productivity and Farmer Welfare
Amul provides extensive support to farmers to improve cattle productivity and welfare. Free training programs are offered to educate farmers on cattle care. Subsidized modern equipment like automatic milking machines, fodder plants, and specialized veterinary care—including super-specialty hospitals—further enhance efficiency and productivity.
A Model of Inclusive Growth
Amul's cooperative structure is a case study in sustainable business, showcasing how profits are equitably distributed. The monthly meetings of district unions address issues like expansion, new machinery, and member bonuses, ensuring the cooperative thrives while benefiting farmers at the grassroots.
