Responding to demands of farmers and recommendations of a study committee, the MoAC had given consent to dairy industires to raise the price of milk three days ago. The MoAC had issued a circular to the Dairy Development Board (DDB) - the daily regulator - and Dairy Development Corporation (DDC) - the state-owned dairy producer - to revise the milk price taking into account the cost of production of milk.
However, the DDC and the private dairies are hesitating to raise prices because of tough competition in the market.
"The DDC isn´t ready to comply with the MoAC direction. How can we (private dairies) alone raise the price?" wondered Ram Kumar Khadka, president of Private Dairy Association. He also sought the DDC´s cooperation to implement the ministry´s decision. Khadka also said unilateral increase in price could be detrimental to the market share of private dairy industries.
Currently, DDC enjoys 60 percent share of Nepal´s dairy market.
“Private dairies want the DDC to take lead in raising milk price. But we, as a public enterprise, have to consider the interests of both consumers and farmers before taking such decision,” Ajab Lal Yadav, general manager of the DDC, said. “However, we are ready to revise the price, if private dairies do so first." Yadav also said private dairies were trying to exercise cartel by compelling it to hike the price as per their desire.
Meanwhile, dairy farmers organised a sit-in at the office of DDC on Wednesday, demanding immediate hike in the price of milk.
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