Milk and dairy-product prices could rise further during the upcoming festive season as the industry faces tighter milk availability and higher input costs, according to Heritage Foods CEO Srideep Madhavan Kesavan.
Speaking to CNBC-TV18, Kesavan indicated that prices of key dairy products, including milk, ghee, paneer and curd, could move higher during the festive period. The outlook comes at a time when consumer demand is expected to strengthen, potentially putting additional pressure on available milk supplies.
One of the factors highlighted was the impact of the West Asia conflict on global commodity markets. International disruptions can influence the cost and availability of commodities and other inputs used across the dairy value chain.
The industry’s concerns also extend to India’s E20 ethanol programme. Changes in the use of feedstocks for ethanol production can have implications for agricultural commodity markets and, consequently, dairy-feed economics.
A weak monsoon is another concern for the dairy sector. Lower or uneven rainfall can affect fodder availability and agricultural conditions, potentially putting pressure on milk production and procurement.
The supply situation is already an important issue for dairy companies. Heritage Foods has reported that milk availability remained constrained and procurement prices increased sharply, with procurement prices rising 7% year-on-year in the company’s latest reported quarter.
Higher procurement prices can increase the cost base for dairy processors, particularly when companies are also dealing with elevated expenses across processing, logistics, packaging and distribution.
At the same time, the festive season typically brings stronger demand for milk and value-added dairy products. Products such as ghee, paneer and curd are widely used during household consumption and festive food preparation, potentially increasing pressure on the supply-demand balance.
For dairy producers, higher milk prices could provide support to farm-gate economics if increased consumer prices translate into stronger procurement prices. However, for processors and consumers, continued increases could raise the cost of dairy products.
The current situation highlights the importance of milk availability during the second half of the year. Weather conditions, fodder supply, procurement prices, commodity markets and festive demand will remain key factors influencing dairy pricing in the coming months.
While Heritage Foods expects further price increases during the festive season, the actual movement in retail prices will depend on milk procurement costs, supply conditions, consumer demand and pricing decisions taken by individual dairy companies.
Source: Dairynews7x7 19 Sep, 2026 Read full story here
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