Slump in SMP, Ghee and Butter price may be over

While the conflict involving the US, Iran, and Israel has undoubtedly had an adverse impact on the trade of desi ghee (clarified butter) and milk powder, the containers awaiting shipment have now been cleared and dispatched to their various destinations—albeit after incurring significant penalty charges. On the other hand, reacting to the market slump, both traders and industrial players have substantially liquidated their existing stocks. Looking ahead, with the commencement of the wedding season—which is expected to drive demand—market sentiment suggests a potential upturn in the second half of the month consequently, the current market rates should be viewed as the bottom, marking the end of the bearish phase.

Sandeep Agarwal, Chairman of SMC Foods Limited, notes that the conflict involving the US, Iran, and Israel has been ongoing for the past 35 days. During this period, traders across various sectors—including those dealing in desi ghee and milk powder—have lost patience. As a result, substantial stocks of goods were liquidated at distress prices. Premium-quality desi ghee, in particular, witnessed a sharp decline, with stocks being sold off at rates as low as ₹8,900 to ₹9,000 per tin. Furthermore, no individual trader is currently burdened with an excessive inventory of lower-grade goods, as they have curtailed fresh purchases over the last 20–25 days while simultaneously liquidating their existing stocks. It is worth noting that there was a prevailing sense of stemming from the fear that exports would grind to a halt because containers carrying butter and butter oil were stranded at sea.

However, these stalled containers have now been cleared, and fresh trade deals for all the aforementioned dairy products have begun to materialize. Meanwhile, dairy processing plants across North India reported a slight shortfall in the supply of liquid milk today compared to previous days. Although liquid milk remains available at ₹53–54 per liter, the available supply was fully absorbed by the processing plants. In anticipation of future consumption requirements, there is currently no pressure from excess inventory regarding desi ghee, butter, or milk powder across the supply chain.

Currently, premium-quality desi ghee from established companies is trading within the range of ₹9,000 to ₹9,300 per tin. Similarly, milk powder is being sold at rates ranging from ₹300 to ₹308 per kilogram, depending on the reputation and brand standing of the manufacturer. Currently, Desi Ghee for export is trading at $6,500 per ton, butter prices are hovering around $5,500 per ton, and there is steady buying interest for Skimmed Milk Powder at $3,200 per ton (FOB). Looking ahead, domestic consumption is set to rise significantly starting April 15th due to the wedding season; simultaneously, farmers will become occupied with harvesting as the weather warms up, which will lead to a reduced availability of liquid milk in the near future. Given these circumstances, there appears to be no scope for a decline in the current prices of Desi Ghee, milk powder, and butter; on the contrary, market rates are expected to firm up in the coming period.

Source : Dairynews7x7 April 4th 2026 NNS  by  Sandeep Agarwal SMC