Price of milk increases

June 20, 2006
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State-owned dairy production agency Dairy Development Corporation (DDC) has increased the price of milk by two rupees effective from Monday (June 19th).

The new market price is set at Rs 26 per liter of milk. Of the total increment, Rs 1.10 will go to the farmers while 90 paisa will go to businessmen including processors, salesmen, transporters and others involved in the production process.

The decision was taken after the joint meeting of DDC, Ministry of Agriculture and Cooperatives, Dairy Development Board (DBB), Dairy Producers Association and farmers held early this month.

“The farmers had demanded a 40 percent price increase, but taking into consideration the burden faced by the consumers, only two rupees has been increased,” said Asheshor Jha, spokesperson at the ministry. According to him, the previous price was set in May 9, 2005. “As prices of milk production factors have increased in this period, increase in the market price of processed milk is obvious,” said Jha.

The records at the Agri-Business and Statistics Division state that 1,312,131 metric tones of milk was produced during the fiscal year 2004-05.

Senior planning officer at the DBB Balak Chaudhary said over 100,000 farmers depend on the dairy industry. But, as the farmers do not wholly depend on milk production for their livelihood, the statistic is an assumption. He said 300,000 to 400,000 liters of processed milk is consumed daily in the country. Milk is imported from India during the dry season, but the board had no record of how much is imported from India. However, in the fall season, there is over production of milk within the country forcing the processors to announce milk holidays. The farmers take one day a week off as their supply cannot be processed, thus a milk holiday.

Kavre district produces largest quantity of milk followed by Ilam in the east.

There are over 200 small and big dairy producers in Nepal at present and over 1,400 milk cooperatives. About 52 percent of the dairy industry is occupied by DDC.