Dairy Farmers seek Rs 100 hike in Karachi milk price

Karachi’s 20 million residents may soon pay significantly more for milk — and this time, the warning comes not from market speculation but from the farmers who supply the city’s dairy chain.

The Dairy and Cattle Farmers Association has formally petitioned Commissioner Karachi demanding an immediate upward revision of Rs 100 per litre in the government-fixed milk price, citing an industry on the edge of collapse.

What Triggered the Demand

The petition isn’t impulsive. Association office bearer Shakir Gujjar describes a compounding cost crisis: animal feed, electricity, petrol, and transportation costs have climbed dramatically over the past two years, squeezing margins to the point where continued operations are financially irrational for many small and mid-sized dairy farms.

The association’s data point is stark — input costs for fodder and milk-related supplies have risen by 75%, while the government-controlled retail price has not kept pace. The result is a widening gap between what it costs to produce a litre of milk and what farmers are legally permitted to charge.

The Government Price-Fixing Problem

Pakistan’s urban milk pricing operates under commissioner-level oversight, where official rates are periodically revised — but rarely fast enough to match inflationary cycles. This structure, designed to protect consumers, often ends up punishing producers. When input costs surge and the official price stays frozen, dairy farmers absorb the loss until the system breaks.

Karachi has seen this pattern before. In 2022 and again in 2023, farmer associations raised similar alarms. Each time, partial price revisions followed — but only after supply disruptions forced the administration’s hand.

Supply Risk Is Real

Association member Mubashir Qadeer Abbasi flagged something more immediate than price: a working capital shortage. When farmers cannot afford to buy feed at current market rates, they reduce herd sizes or exit the business. That directly shrinks milk supply — independent of any price negotiation outcome.

Karachi’s dairy supply chain is already stretched. Much of the city’s raw milk travels from peri-urban farms in Sindh and even Punjab. Logistics costs on those routes have risen sharply with fuel prices, compressing margins further at the delivery end.