Government prepares to make adjustment in price of milk Business 360

Government prepares to make adjustment in price of milk

This image shows the building of the Ministry of Agriculture and Livestock Development in Singha Durbar, Kathmandu in June 2020. Photo: RSS

  • Committee recommends increasing the price of milk by Rs 10 per litre
  • With the adjustment of price, a farmer will get Rs 60 per litre
  • A farmer will get Rs 7, dairy entrepreneur Rs 3
  • Consumers will have to buy at Rs 86 per litre

KATHMANDU: The Ministry of Agriculture and Livestock Development is preparing to make adjustments to the price of milk on the basis of the recommendation of a committee formed to conduct a study to that connection.

The ministry formed a committee after the Central Dairy Cooperative Association Limited Nepal requested to increase the price of milk citing that they were not getting even the cost of investment of the milk by selling milk at its present price.

The committee’s report states that the farmers are compelled to sell milk bearing loss as the price of milk has remained the same for two and a half years while the price of animal feed and fodder has sky-rocketed during the period.

Although the price of milk had been adjusted every year in the past, it has not happened for the past two and half years.  Farmers have been selling milk for Rs 53 per litre at present. The report states that the farmers bear a loss of Rs 4 per litre when they sell milk at the current rate. It is stated in the report that the price of milk needs to be adjusted in tune with the time as the price of veterinary medicine, the salary and allowances of the person tending the cattle, transport cost and the price of other goods and equipment have gone up.

The report recommends increasing the price of milk by Rs 10 per litre. A consumer has to pay Rs 76 per litre at present.  If the price is adjusted as per the Committee’s recommendation, the farmer will get Rs 60 per litre while the consumers will have to buy at Rs 86 per litre. Out of the Rs 10 per litre price increment following the adjustment, the farmer gets Rs 7 while the dairy entrepreneur gets Rs 3. The farmer will make a profit of Rs 3 per litre after deducting the investment price after the implementation of the new price based on the report.

The committee prepared the report after consulting with the dairy farmers and dairy entrepreneurs in various districts — Ilam, Jhapa, Sunsari, Morang, Saptari, Sarlahi, Bara, Makawanpur, Kavre, Chitwan, Nawalparasi, Rupandehi, Kaski, Banke, Surkhet, Kailali and Kanchanpur.

The dairy industry contributes 5% to the GDP of the country. The annual milk production in the country has reached 2,301,000 tonnes. Of the total production, 40% is cow milk and 60% is buffalo milk.

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