CHENNAI: State-owned dairy co-operative Aavin on Tuesday defended its decision to raise dairy product prices, saying more than 90 per cent of the additional revenue from the revision would go to milk producers’ welfare.

It also underscored rising production costs, which it said necessitated the "adjustment."

In a statement, Aavin said it had assessed the prices and production costs of comparable products sold by private dairy companies and cooperative milk federations in other states before revising its rates. It maintained that its products would remain cheaper than comparable offerings from private and cooperative brands even after the increase.

The clarification comes amid scrutiny of the price increase, which marks a significant pricing decision under the TVK-led government.

The revision was necessary to offset rising production costs and maintain Aavin’s competitiveness in the market while preserving the co-operative society's not-for-profit motive, the statement said.

Emphasising the importance of safeguarding farmers’ livelihoods, Aavin said milk production is a major source of income for lakhs of rural families and that the government is responsible for ensuring remunerative procurement prices for producers.

The additional revenue would help improve producers’ incomes and strengthen the cooperative milk procurement network, it said.

Aavin said its primary objectives remained protecting milk producers’ interests and supplying quality milk and dairy products to consumers at reasonable prices.

Aavin said public support was essential to strengthening the cooperative sector and improving milk producers' livelihoods, and appealed to consumers to continue supporting it.