Fresh milk, nutrition and the need for import substitution

Milk is a compulsory need for infants as well as growing adults due to its high nutrient value. Many decades ago then Minister of Education charismatic and controversial Dr. W. Dahanayake initiated a mid-day meal program for school children comprising a glass of milk and a bun; perhaps for this reason Dr. Dahanayake was popularly named “banis maama”.

In the mid to late ’60s, the Milk Board – a fully-owned entity of the Government – popularised milk drinking by opening milk booths in schools as well as places like bus terminals. This was a highly-successful venture with milk of many flavours and popsicles being made available to the school children as well as general public.

With the economic liberalisation trend of 1977, the Milk Board too was privatised in keeping with then Government policy.

Frequent escalation of prices of imported milk powder cause much heartburn due to the unbearable costs; such milk is more often consumed by infants and children.

The current flexible exchange rate regime further adds to the complexity. Very recently there was much confusion and apprehension in the minds of people of possible contamination in a certain brand of imported milk powder.

Farms and fresh milk

Prior to the 1977 liberalisation of the economy, the limited dairy industry was more in the hands of the State-owned farms apart from farms operated by small-scale operators. However, the State farms and the small-scale dairy farmers virtually catered to the entire village with the aid of a push-cycle. The milkman on a cycle was a regular sight not only in the villages but also in some of the cities.

In the urban residential areas like Nawala and Narahenpita quite a number of farms operated, with vast grass lands around to feed the cattle. However, with the rapid development taking place at that time, most of these lands became preferred sites for house building.

This phase was followed by the emergence of multinationals investing on a large-scale in the dairy industry.

The annual cost of import of milk powder is estimated at US$ 251 m, which is 1.85% of the country’s import bill.

At times local producers who could not supply their produce even threw away their produce through sheer frustration. Apart from the leading global brand owners, some importers began importing milk powder with limited regulatory control, perhaps these practices continue to date also at a cost to the State. At present there seems to be a large number milk powder importers who obtain their products from various sources with little regulatory supervision.

In recent times many companies involved in supplying fresh milk have made great strides in this sphere and have rightly provided fresh milk to cater to the needs of public as against supplying variety of milk powder that’s now flooded in the market. Most of these are not well established brands of repute.

“We have also extended our relationships with farmers across the island.

We now procure milk from 18,000 farmers and reached a significant milestone when we recorded our highest annual procurement of local fresh milk in 2012, evidencing a 20% growth from previous year. This together with our procurement of other raw materials including coconut, marks the company’s highest annual contribution to the rural economy; where we contributed Rs. 4 billion in 2012 to more than 23,000 local farming families.

We are constantly assessing and making progress in improving the nutritional value of our products such as reducing sugar and sodium for example. We are also continuing to identify widespread nutritional ‘gaps’ in diets and are focusing on fortifying our products with essential micronutrients such as iron, vitamin and Zinc to help lower micronutrient deficiencies in the country.” – (Nestle Lanka PLC Annual Report 2012)

Promoting fresh milk

As a high import dependent country, the Sri Lankan economy is going through a bleak spell amidst a continuing global financial crisis in developed countries, with most exports fetching lower prices and foreign exchange limitations. This is a vicious circle that’s adding more worries.

The Government is now taking serious steps to reverse the prevalent trend by promoting fresh milk and curtailing consumption of imported powdered milk.  In recent times, National Livestock Development Board (NLDB) booths have been set up at various locations in and around the city that have become very popular among the general public.

 However this process has failed to reach great heights owing to limitation of sales and marketing skills.

The Ministry of Livestock and Rural Community Development (LRCD) is planning to reach self-sufficiency in milk by end 2015 – a challenging but rewarding task.

It’s heartening to note the initiatives of the Ministry of LRCD by strengthening the private sector, a social strategy to empower the farmers though self-managed societies without Government intervention.

At present quite a number of local entrepreneurs provide good quality dairy products to the market.

Tea plantations where estate labour lives within the premises of the estate have had a tradition of dairy farming; this culture could be further encouraged with the assistance of the privately-owned plantation companies.

This could lead to a profitable and sustainable cottage industry that could improve the living conditions of the poor labourers who toil hard in the tea lands for many hours of the day.

Very recently the Government decided to allocate unused lands belonging to plantation companies to the unemployed, enabling them to be active partners in agriculture.