Milk Vita hikes prices by Tk 10 per litre

Bangladesh’s state-owned dairy cooperative, Milk Vita, has raised liquid milk prices for both farmers and consumers, pointing to spiralling production costs and broader economic inflation.

Under the new rate structure that took effect on August 1, a one-litre packet of processed milk now costs Tk 110, up 10 percent from Tk 100.

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At the same time, the cooperative has increased its procurement rate for farmers to Tk 53 per litre for milk with a minimum 4 percent fat content, compared to Tk 50 last month.

While livestock producers in dairy hubs such as Pabna and Sirajganj have welcomed the higher payout, they are urging government intervention to stabilise cattle feed prices.

Meanwhile, consumers say the increase adds further financial pressure during a period of widespread cost-of-living strain.

HIGHER FEED COSTS SQUEEZE FARMERS

Rising feed expenses, compounded by seasonal monsoon deluge that submerges natural pastures, have driven production costs above Tk 50 per litre.

“Production costs have risen due to higher feed prices. Milk Vita does not compromise on quality and requires the best milk from farmers. Therefore, the authority increased prices to ensure farmers remain profitable,” said Amio Kumar Mondol, Additional General Manager of Planning and Development at Milk Vita.

"Milk Vita prefers higher fat content, but milk quality depends on animal feed," explained Md Saiful Islam, president of the Pabna Milk Producers Association, noting that during the rainy season, farmers have to rely heavily on dry fodder, and it pushes costs higher.

​“Under the new rate sheet, we receive Tk 53 per litre for milk with 4.0 percent fat, Tk 54.10 for 4.1 percent fat, Tk 55.30 for 4.2 percent fat, and up to over Tk 60 per litre for 4.7 percent fat,” Raju explained.

Local producers pointed out that private competitors like Aarong and Pran have yet to match Milk Vita’s higher purchase rates. Consequently, many farmers are redirecting their yield to retail buyers and sweetshops to secure better margins, keeping only minimum supplies with private firms to safeguard seasonal off-peak contracts.

​“We maintain relationships with private processors because they buy our surplus during the three-month slow season following Eid-ul-Fitr, when retail demand drops,” said Md Al-Amin, a milk producer from Faridpur.

Market checks show private dairy brands had already pushed retail prices above Tk 110 in recent months, absorbing their cost increases earlier.

GAS SHORTAGES DRIVE UP PROCESSING COSTS

For consumers, the price adjustments extend across all packaging sizes -- 500ml packets have risen from Tk 55 to Tk 60, while 200ml packets now cost Tk 33, up from Tk 28.

Consumer rights advocates have criticised the timing of the hike. ABM Fazlur Rahman, president of the Consumers Association of Bangladesh (CAB) in Pabna, stated that the sudden increase places an extra burden on households already struggling with high food inflation.

Defending the decision, Dr Md Nazrul Islam, Manager of Production at Milk Vita, said escalating operational and energy expenses left the union with no alternative.

"Operating a milk boiler without gas costs us Tk 30,000 per hour using alternative fuel," Dr Nazrul said, explaining that severe gas supply shortages have severely inflated factory overheads.

Despite the cost pressures, Milk Vita’s daily collection remains stable at 100,000 to 125,000 litres nationwide, comfortably exceeding daily consumer demand of 80,000 to 85,000 litres.