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Milco’s dairy farmers crying over delayed fresh milk payments
View(s):Dairy farmers supplying fresh milk to the state-run Milco (Pvt) Ltd complain payments due to them from the company are delayed for months and as a result their families are in dire straits.
Admitting that there was a delay in payment, the company’s General Manager Pio Fernando said the problem was owing to oversupply.
“As a state-run company, we have to buy the fresh milk from farmers but this policy led to oversupply while the company was struggling to keep its market share amid tough competition from other market players.
He said the company was looking at ways to make use of the excess milk and one proposal was to increase milk powder production.
Mr. Fernando said the farmers were told that the problem would be solved within two months with the company implementing its market expansion plan.
Milco has 2,300 collection centres islandwide and they are managed by a 65,000 member-strong Farmer Managed Societies (FMS). Through this network, the company gets 150,000 liters of quality fresh milk daily and the quantity amounts to more than than 40 percent of the national milk collection.
Oddusudan FMS Secretary Kandasamy Kiritharan told the Sunday Times that many families in the North were suffering financial hardships since they had bought high yielding milch cows such as Friesians, Jersey and hybrid cows by obtaining micro-finance loans from financial companies and the Samurdhi Bank.
“Usually, we get paid in the third week for the first two weeks’ supply. But of late, we get paid nearly after one month,” he said, pointing out that the financial difficulty the war-affected families had been asked to undergo was too much to bear.
As a result of the delayed payments from the company, the farmers were charged additional interest by the finance companies and even by the Samurdhi Bank. Mr. Kirthitharan said he had obtained a Rs. 500,000 loan to buy Jersey cows and set up his dairy farm.
He said more war-affected families had taken to dairy farming in the north, leading to a sharp increase in the milk production. According to a Milco official, the company’s northern regional collection point recorded 38,000 liters of fresh milk daily where it was 11,000 liters two years ago.