Chief Minister C. Joseph Vijay announced an increase of ₹3 in the milk procurement price paid to Milk Producers' Cooperative Societies, making the statement under Rule 110 in the Legislative Assembly on Wednesday. The revision will benefit more than 3.16 lakh milk producers across the state and cost the government an additional ₹360 crore annually.
The procurement price is what the cooperative system pays the farmer for milk delivered to the society — the figure that determines whether dairying remains viable at the household level. Raising it strengthens the cooperative channel against private buyers, and directly affects the earnings of small producers, many of whom keep only a few animals.
The increase has not settled the matter. Reports indicate the revision takes Aavin's procurement price from ₹38 to ₹41 a litre. The Tamil Nadu Farmers' Association has said the increase is insufficient, and has announced that its planned milk-supply strike from 24 August will go ahead as scheduled.
The dispute turns on input costs. Producers point to the price of cattle feed, veterinary care and labour, and argue that a ₹3 revision does not restore margins eroded over several years. The government's position is that the increase is being made against real fiscal constraints, at an additional ₹360 crore a year.
Whether the strike proceeds will be the test of whether the revision holds.
The announcement continues a sequence of farm-sector measures. On 17 August, the government expanded the crop loan waiver a third time, fully waiving cooperative loans up to ₹75,000 and taking the total to ₹6,220 crore for 13.34 lakh farmers. On 10 August, procurement incentives were raised for paddy and sugarcane, taking fine-variety paddy to ₹2,750 a quintal and sugarcane to ₹4,000 a tonne.
The Agriculture Budget of 6 August had also revived the free milch cow distribution scheme, alongside the Vetri Magalir goat-rearing scheme announced in the main Budget.
Milk Procurement Aavin Dairy Farmers Rule 110 August 19, 2026