India’s US$70bn dairy sector has asked the country’s government to lift the ban on export of milk and milk products, telling just-food domestic supplies are sufficiently healthy for international trading.

The ban was actually imposed in February at the industry’s behest to check soaring milk prices: rising 12% in wholesale and 20% in retail last year.

However, R S Sodhi, managing director of Gujarat Cooperative Milk Marketing Federation that owns the key Amul dairy brand, told just-food: “The local supply has improved. Across India, milk cooperatives are getting 20 per cent surplus milk and milk solids. As a result, the procurement price of milk has crashed. With no avenue to export the surplus milk, the situation has become very grim.”

Low milk and milk products prices have benefited manufacturers such as Nestlé and Britannia Industries in the short term but Sodhi said there were long-term risks for India’s 11m dairy farmers. “If this slide (in milk price) is unchecked, farmers will turn away from milk production resulting in a shortage next year.”