The rather strange case of milk prices

THE price of milk in the retail market has gone up once again. The latest hike has been as abrupt as has always been the case over the last couple of years. It is currently available in the open market at anywhere between Rs170 and Rs200 per litre, depending on the locality.

I understand that the prices of tomatoes, onions and potatoes register a sharp increase every now and then because of the gap between demand and supply. There are times when natural elements hurt the crop, and every now and then we have to import them from neighbouring countries. But milk? What is the issue with milk prices in a country which happens to be one of the leading producers of the commodity in the world?

In the case of tomatoes coming from Iran, ‘patriotic’ Pakistani farmers occasionally destroy consignments coming to Karachi, knowing that a surplus would reduce their incomes substantially. One can see the same mindset among leaders of the oil-producing countries who time and again agree to reduce production by millions of barrels per day to manipulate prices.

All this I am able to understand. I really do. What I fail to understand is the mindset and manipulation in the milk market. It is available in abundance — or so we have been told for years — and there is no way of reducing milk production.

Also, milk is not a speculative market, like stocks, currency , gold, etc., where prices fluctuate on the basis of political and economic currents. Surely, the hike in milk prices by the producers could not be due to petrol and diesel prices remaining unchanged, or due to the outcome of recent by-elections, or the reported increase in the salary of Punjab legislators, or because President Joe Biden called Pakistan one of the most dangerous countries in the world.

So, then, what exactly is the logic behind the surge in the prices of milk? Pray, tell me.

Shakir Lakhani


Published in DAWN, October 28, 2022