The Milk Powder Importer’s Association has reassured consumers that there will be no immediate price hike in the milk powder market, despite the recent 10% increase in taxes on imported milk powder by the Trade Ministry, which came into effect last Friday.
A spokesperson for the Milk Powder Importer’s Association explained, “The cost of one kilogram of milk powder upon arrival at the Colombo port stands at Rs.1,100. This high cost is primarily attributed to the inefficiencies in local milk production and the ineffectiveness of local milk production projects over the past two decades. Despite the importation of more than 20,000 dairy cows from abroad, all these animals have unfortunately perished. Over the past 30 years, this is the highest amount of tax we’ve paid on milk powder.”
The spokesperson further stated, “In the absence of taxes, we could offer imported milk powder at Rs.600 to Rs.625 per kilogram. Currently, due to a decline of over 50% in milk trade in recent months, we have sufficient milk supply for the next two to three months, negating the need for an immediate price increase. However, if taxes are not reduced, we may be forced to consider a price hike in December or January.”
In response to concerns, Trade Commerce and Food Security Minister Nalin Fernando emphasized the government’s commitment to supporting local farmers and protecting their interests. He explained, “We cannot significantly reduce the price of milk powder, as it would negatively impact our local farming community. Our farmers received relief when global milk powder prices decreased in the past. Even with a 10% tax increase, if milk prices rise, we will take the necessary actions to address the situation.”