Aavin dairy supply issues in Tamil Nadu

In July 2026 the Tamil Nadu government withdrew a revised pricing order that had raised billing and wholesale margins for Aavin’s ghee products after media scrutiny, while assuring that retail prices remained unchanged. At the same time, Aavin faced pressure on its milk procurement because private dairies were offering farmers substantially higher rates – up to ₹50‑₹60 per litre compared with Aavin’s ₹34‑₹44 – prompting many producers to shift supply away from the state‑run cooperative. By the end of July, the cooperative’s daily milk collection had fallen from about 3.8 million litres to roughly 2.5 million litres, creating a shortfall of around 10,000 litres in Tiruchy. Farmer groups and the Milk Dealers’ Welfare Association urged the Milk and Dairy Development Minister to raise procurement prices, increase dealer commissions, and revive subsidy schemes to prevent further supply erosion and protect the livelihoods of millions dependent on dairy farming.