An unprecedented hike in demand for ice cream this summer season has led to a major supply shortage, forcing companies to boost their production by over 30%.
The prolonged period of heatwaves and early onset of summer has resulted in a sales hike of around 45% during the last three months as compared to the corresponding period in 2019, showing estimated data of industries.
"Demand for ice cream and value-added dairy products like lassi and buttermilk has more than quadrupled compared to last year," said R S Sodhi, MD of Gujarat Cooperative Milk Marketing Federation, which distributes its goods under the Amul brand name.
"However, businesses have not been stockpiling up in winter as they used to before the outbreak." This has resulted in shortages in some circumstances," he explained. Manish Bandlish, MD of Mother Dairy Fruit & Vegetable, stated that the dairy giant's summer has been spectacular thus far.
According to the Indian Ice Cream Manufacturers Association, an organization representing 80 private ice cream producers, the increase in demand in 2022 is likely to help the Rs 9,000-crore ice cream sector inch closer to the Rs 11,000-crore objective.
The sale from March to June accounts for 45-50 percent of ice cream producers' yearly sales, with the top ice cream eating states being Maharashtra, Uttar Pradesh, Delhi-NCR, Gujarat, Andhra Pradesh, Telangana, and Tamil Nadu.
"This increase in demand is mostly due to early summers and the subsequent temperature rises, increased number of distribution assets, and the opening of restaurants, workplaces, and educational institutions," Bandlish explained. "Both our milk-based ice creams and dairy-based drinks have increased by more than 35-40% over the pre-Covid period."
The increase in sales comes two years after the ice cream market was severely impacted by the pandemic, with revenues halving in 2020, only to somewhat recover the following year. While the industry has seen a surge in demand for the on-the-go impulse portfolio this year, as temperatures have risen, in-home consumption has also increased.
According to Pradeep G Pai, MD of Karnataka-based Hangyo Ice Creams, most firms have raised their pricing by 5-10% due to rising input costs.