Fair fare

Thursday, 5 May 2011 00:00 - - {{hitsCtrl.values.hits}}

FOR most families, especially those with children, milk prices can be a huge burden. Recently the Government decided to increase the price of a 400g pack of milk powder by Rs. 20 and one kg packet by Rs. 49. This would perhaps have been borne better if the shock to the wallet had at least provided incentive to local farmers.

Fresh milk producers have pointed out that the Government has a lopsided policy that favours powdered milk importers rather than the local dairy farmer. They point out that repeated price increases, while necessary, given the historically high international prices, have nonetheless not benefited local farmers. Improving the infrastructure and profits of the dairy industry are key to attracting more farmers to produce larger stocks of milk that would be sufficient for national consumption.

The once-flourishing industry suffered a crippling blow with the beginning of the conflict. Since most of the lucrative bases such as Ampara were at the heart of the conflict for three decades, the resurgence of the industry even after the conflict has been slow. Industry experts point out that it takes years to breed a herd of cows and make them give milk consistently. Moreover, finding the right breeds and importing them, finding the correct feed and providing veterinary care is still very difficult for small scale farmers.

Increasing urbanisation has also reduced the feeding grounds for cattle and the recent floods threw an additional gloomy cloud over the industry by destroying many herds, especially in the Eastern Province. These are all constraints that will take years to overcome. Currently, the United States Agency for International Development (USAID) is conducting a programme in Batticaloa to join dairy companies such as CIC and Ambewala with small time farmers so that they can learn new techniques and methods. It is clear that more programmes of this nature are needed to encourage rural people to take up dairy farming.

The most important facet is providing the high return to the farmer. In 2010 total milk production rose by 6% to 247 million litres and domestic milk production as a percentage of the total national requirement of milk increased to 30% from that of 28% in 2009. Milk collection of major milk product manufacturers rose by 10% to 137.6 million litres and milk collection centres increased from 2,673 in 2009 to 2,895 in 2010, according to the Central Bank.

Unfortunately, the average producer price of liquid milk was Rs. 32.50 per litre in 2010 compared to that of Rs. 29.50 per litre in 2009. Dairy industry experts believe that this amount must be doubled if the dairy farmer is to get the maximum benefit. If the Government is serious in its target is to reach self-sufficiency in milk production by 2020, then policy makers need to make fair adjustments that would be used to bridge the 70% gap and save billion of rupees in the process.

Ensuring that the dairy farmer gets a fair deal will be the best incentive that can be provided to not only grow the dairy industry, but also alleviate poverty and bring development at grass root level. This is all the more important as most regions where the dairy industry is based suffer from income disparity when compared with the rest of the country.