Chandigarh, May 9, 2026 — In a major boost to the state’s dairy sector, the Punjab government has announced a significant increase in the milk procurement price for farmers associated with Milkfed (Verka). Effective from May 1, the procurement rate has been hiked by ₹20 per kg fat.
The decision is expected to strengthen the cooperative dairy framework and provide immediate financial relief to approximately 2.5 lakh farmers directly linked to Verka’s network.
Economic Impact on Punjab’s Rural Sector
According to a state government spokesperson, this move is designed to make dairy farming more viable in the face of rising input costs. The broader economic implications include:
- Direct Infusion: An estimated ₹100 crore monthly will be injected into Punjab’s rural economy.
- Wider Reach: While 2.5 lakh farmers are directly under Milkfed, the hike is expected to eventually benefit nearly 30 lakh milk producers across the state as private players may be forced to increase their rates to remain competitive.
- Strengthening Cooperatives: By offering better remuneration, the government aims to reinforce the position of Milkfed as a leading dairy cooperative in North India.
How Milk Procurement Pricing Works
In the cooperative sector, milk is not bought at a flat “per litre” rate. Instead, the price is determined by the quality of the milk, specifically the Fat and SNF (Solid-Not-Fat) content.
- Fat Content: This is the primary driver of the price. Higher fat content (common in buffalo milk) results in a higher payout per litre.
- SNF Content: This includes proteins, lactose, and minerals.
- Impact of the Hike: A ₹20 per kg fat increase means that for every 1% of fat in a litre of milk, the farmer earns more, effectively increasing the “per litre” take-home pay by roughly ₹1.20 to ₹1.60, depending on the milk type.
Read More: Ludhiana as Dairy Owners Dump Cow Dung at MC Office
Strategic Timing
The hike comes at a crucial time as dairy farmers grapple with the high costs of cattle feed and maintenance during the summer months. By ensuring better remuneration, the Punjab government hopes to sustain milk production levels and discourage farmers from shifting away from animal husbandry.
Milkfed Punjab continues to dominate the regional market, and this move further solidifies its “Verka” brand as a farmer-centric organization committed to the welfare of the rural community.
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