Karnataka hikes Nandini milk procurement price by Rs 8 per litre from Nov 1; hotels warn of costlier food

Mangalore Today News Network

Bengaluru, October 30, 2026: The Karnataka Cabinet has approved an Rs 8-per-litre hike in the procurement price of Nandini milk, effective November 1. Of the increase, Rs 7 will go directly to dairy farmers, while Re 1 will be allocated to milk unions to cover operational expenses.

The decision, however, has drawn criticism from Bengaluru’s hotel industry, which has warned that the hike could lead to higher prices for tea, coffee, snacks and other milk-based items.

The decision was taken at a Cabinet meeting chaired by Chief Minister D.K. Shivakumar at Vidhana Soudha on Thursday. Bengaluru Development and Parliamentary Affairs Minister Krishna Byre Gowda announced the revision while briefing the media after the meeting.

With the revision, the procurement price paid to farmers will increase from Rs 35 to Rs 42 per litre. Including the existing state government incentive of Rs 5 per litre, farmers will effectively receive Rs 47 per litre.

The retail price of milk is expected to increase to around Rs 54 per litre. However, the final selling price will be determined by individual milk unions based on factors such as fat and solids-not-fat (SNF) content.

Explaining the rationale behind the decision, Gowda said dairy farmers were facing difficulties due to drought conditions, rising input costs and declining milk procurement.

Around 228 taluks have been affected by drought, while El Niño conditions and summer temperatures have further impacted milk production. Daily milk procurement has reportedly declined by nearly 10 lakh litres.

"In this situation, it is our responsibility to support dairy farmers," Gowda said.

Farmers had been demanding a Rs 10-per-litre increase and had also staged protests in Bengaluru. Following discussions with milk unions and the ministers concerned, the Cabinet settled on an Rs 8 hike.

Gowda said Rs 7 of the increase would benefit farmers directly, while the remaining Re 1 would help milk unions meet rising expenses related to packaging, transportation, fuel and other operational requirements.

He maintained that milk unions operated autonomously and that the revised procurement price was their decision, with the government facilitating support for farmers.

"Milk unions belong to dairy farmers. They must ensure that farmers receive a remunerative price while also meeting the costs of processing, packaging and transportation," he said.

Gowda also maintained that Karnataka’s milk prices would remain competitive despite the revision. He cited prices of around Rs 59 per litre in Delhi and Maharashtra, Rs 57 in Gujarat, Rs 64 in Telangana and Rs 56 in Kerala, adding that some competing brands charged considerably more.

Hotels warn of higher food prices

The Bengaluru Hotel Owners’ Association has expressed strong dissatisfaction with the hike, warning that hotels may have little option but to increase the prices of milk-based products.

In a press release, the association described the Rs 8 increase as unprecedented and said a limited hike of Rs 2 or Rs 3 per litre would have helped hotels avoid passing on the additional burden to customers.

It said the steep increase would affect ordinary consumers, senior citizens, pregnant women and children who depend on milk as a nutritious food. The association urged the government to reconsider the increase in Nandini milk and milk product prices and promote greater consumption.

It also called for measures to curb administrative expenditure in the dairy sector and provide incentives to farmers to prevent further price increases.

"While making such a substantial increase in prices, it is also essential to give careful consideration to the interests of ordinary people," the association said.

Pointing to the continued rise in rice prices, the association said the combined increase in essential commodity costs was putting additional pressure on the hotel industry.

With both milk and rice becoming costlier, hotels would be compelled to revise the prices of coffee, tea, snacks and other food items, it added.

The Cabinet had agreed in principle to revise the milk procurement price at its previous meeting, but left the final decision to the Chief Minister in view of the model code of conduct for the Legislative Council elections.

With the elections concluded, the revised procurement rates will come into effect on November 1, ahead of the Deepavali festival.