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Dairy products: Milky war

Aarati Krishnan

The promised review of the Milk and Milk Products Order, which protects milkshed areas for dairy companies, could intensify competition for procurement for the major dairy players. This could lead to an escalation in input prices over time. Nestle India, which has so far relied on its dedicated milkshed area in Moga, could be impacted by the move.

However, given Nestle's strong position in value-added milk products such as weaning foods and milk products, passing on the higher input costs to consumers might not be difficult. The proposal may have no immediate implications for Britannia as the company presently relies on outsourcing for its dairy products business.

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