Punjab Dairy Reels After Rs 20/- Price Cut Farmers Protest

Dairy farmers in Punjab have raised the alarm after the state government reduced milk procurement prices by ₹20 per kg of fat with effect from 21 December, a move that has sharply dented farmer incomes and confidence in the sector. The Progressive Dairy Farmers Association (PDFA) has written to the Chief Minister urging an immediate rollback of the cut, warning that the decision could trigger an economic crisis for lakhs of milk producers whose cost of production has been rising steadily.

According to PDFA President Rajpal Singh, Punjab has long been recognised for its strong dairy economy and for providing meaningful employment to the youth who have invested heavily in modern dairy farms. In recent years, assurances had been given to increase milk prices, but instead of a rise, the new reduction has come at a time when farmers expected support, not price compression, in the face of elevated input costs like feed, fodder and labour.

For context, last year dairy cooperatives in Punjab had revised various product prices under the influence of GST reforms, and milk procurement prices had been supported at higher levels relative to neighbouring states — but the current cut represents a significant backward step that directly reduces farm-gate returns for milk fat. Farmers argue that this action undermines years of growth in the sector, and threatens the very confidence that encouraged many educated youth to choose dairy farming over migration or non-farm jobs.

The PDFA letter emphasises that the dairy sector is not only a major pillar of Punjab’s rural economy but also a key driver of village prosperity, and that such unilateral price reduction without consultation with producers could reverse hard-earned gains, demoralise the next generation of dairy entrepreneurs and depress milk collection volumes if not rectified urgently.

Source : Dairynews7x7 Dec 26th 2025