2 new Aavin dairies to double supply

Chennai: With Gujarat-based Amul slowly firming up its dairy footprint in Tamil Nadu, the state govt-run Aavin has begun ramping up its infrastructure in Chennai after several years.

Two new dairies — one in Madhavaram with a capacity of 10lakh litres a day and another in Acharapakkam of 1 lakh litre capacity — are set to begin operations by March 2026, effectively doubling Aavin's current milk supply potential in Chennai to 22 lakh litres a day, said A Annadurai in response to a grievance letter from the Tamil Nadu Milk Dealers and Workers Welfare Union.

The move comes days after Amul managing director Amit Vyas told reporters here that the brand, already selling curd in Chennai, will "slowly and steadily enter into the milk segment" through its plant in Chittoor.

Though Chennai, with a population of more than one crore, is a high-potential dairy market, Aavin's current daily sales in the city hover around just 11 lakh litres. Private dairies, despite commanding higher prices, have a stronger presence. Many brands have increased prices by 2 to 3 thrice in the past year, without prior notice or justification.

"Aavin's Green Magic, a standardized variant, is in high demand. But it's restricted to monthly cardholders. At retail outlets, agents push the full cream ‘premium' or toned ‘nice' packs, which don't suit our morning coffee," said T Sadagopan, a resident-activist from Pattabiram. "Aavin should promote what consumers actually prefer, not what offers them higher margins."

Beyond sales, Aavin's response letter also addressed environmental concerns raised by the union. The Ambattur dairy, one of its key units, was flagged for polluting the Korattur lake. Aavin said that its sewage treatment plant, earlier operating at 3.3 lakh litre a day capacity, is being upgraded to 7 lakh litres a day, with the new facility expected to go live by the end of 2025. Indian Institute of Technology Madras has certified the treatment unit's current output at 700 KLD, and formal approvals from the pollution control board for capacity expansion are under process.

On the procurement front, Aavin released 342.14 crore in procurement incentives since Dec 2023, directly credited to dairy farmers through cooperative unions. Dealers too have been seeking a revision in commission rates, which currently stand at 1.5 a litre for retail sellers and 2 for wholesale. Aavin has said the revision will be considered when milk prices are restructured.