Aavin withdraws ghee price revision within a week after media spotlight

CHENNAI: The Tamil Nadu government on Monday (July 20) withdrew Aavin’s revised pricing order for ghee within a week of its issuance, after the move came under media scrutiny, while asserting that consumers were never sold the product at higher retail prices.

Proceedings issued by the Tamil Nadu Cooperative Milk Producers’ Federation, which markets the milk and dairy products under the Aavin brand on July 14 had revised the billing price, maximum retail price (MRP) and the wholesale dealer (WSD) margin for select ghee variants with effect from July 15.

Under the order, the 500-ml ghee pet jar was assigned a revised billing price of Rs 347.62 up from Rs 333.33. Likewise, the one-litre ghee pet jar was revised to a billing price of Rs 666.67 from Rs 647.62, while the one-litre ghee carton was revised to a billing price of Rs 657.14 from Rs 638.10. The proceedings also altered the commission payable to wholesale dealers and retailers.

The revised order entered the public domain soon after its issuance, triggering reports that Aavin had increased ghee prices.

Issuing a clarification on Monday, the government said reports claiming that Aavin had raised the retail price of ghee were “factually incorrect” and did not reflect the actual position.

“Aavin continues to supply all variants of ghee to consumers at the existing retail prices. There has been no increase in the price of any ghee variant,” the clarification said.

It further announced that the revision in the WSD margin had been withdrawn and that the earlier margin structure would continue.

The latest decision effectively rescinds the July 14 pricing revision, restoring the previous billing prices, MRPs and dealer margin structure.

The episode saw Aavin approve revised billing prices and MRPs for its ghee products through an internal order, only to withdraw the exercise within a week after it attracted widespread media attention, while maintaining that the revised retail prices were never implemented.