Although they collect about 2 billion per year from the dairy industry for collecting milk, the cooperative invests elsewhere without paying the farmers
- After the arrears owed by the dairy industry to farmers exceeded 5 billion during the dry season, the ministry called for a discussion in the presence of Agriculture and Livestock Development Minister Ramnath Adhikari last Tuesday. In a meeting with the officials of Secretary Deepak Kharal, Dairy Development Institute (DDC), Department of Animal Services, Dairy Industry Association, Nepal Dairy Association and Central Milk Producers Cooperative Association, Secretary Kharal said that the cooperative has invested money elsewhere. "How many cooperatives have invested in other places without paying the farmers even though the dairy industry has given them money," he said.
- There was a shortage of milk in the market during the dry season about 2 years ago. Covering the opportunity of shortage, some dairy cooperatives started cartelizing in milk. It was accused of spoiling the market by setting the milk rate arbitrarily. It was alleged that the farmers were given too little because of the high price from dairy. In that context, a discussion was held in the Ministry with the then Agriculture and Livestock Development Minister Jwalakumari Sah, officials of the Dairy Development Institute, Dairy Industry and Central Milk Producers Cooperative Association. In the discussion, Minister Sah said that she knows everything about who did the bullying and called the cooperatives middlemen and brokers in the dairy sector.
State-owned DDC and private dairy industry have not paid farmers for months. Farmers have not been paid on time since Covid. Although the dairy industry sold the milk purchased from farmers in cash, some farmers have not received payment for about 6 months.
has been running open season lately. At such a time, the milk production is low, the dairy industry and DDC have to sell the stock to pay the farmers. But the farmers have not received more than 5 billion rupees from the dairy industry. According to the Central Milk Producers Cooperative Association, farmers have not received Rs 3.5 billion from private dairies and Rs. 1.5 billion from DDC.
Cooperative collects more than 1.97 billion rupees annually from the dairy industry for collecting milk. But since the farmers have not been paid for months, they have remained silent, raising questions about their role. As the former minister and secretary said, the question has been raised that the dairy industry did not give the money paid to the farmers on time.
"Industries have not paid on time, some cooperatives have also received complaints that they have delayed payment," said a senior official of the ministry. Now, along with the dairy industry, it is necessary to monitor and inspect if the milk cooperatives have paid or not.
Panchkaji Shrestha, president of the Farmers Group Federation of Nepal, said that the milk producer cooperatives have not paid the farmers. Some cooperatives have stopped paying farmers and invested in other areas. He said that some people use it to pay the interest of the bank. Along with the dairy industry, some cooperatives have also committed bullying. Unfortunately, the government itself became the middleman in this. The policy rules are one thing, the work is done another," said Shrestha, "It is necessary for the concerned municipality to study the context of cooperatives investing elsewhere."
About 6 lakh farmers are directly involved in the dairy sector. Nepal Dairy Industry Association and Nepal Dairy Association collect milk from around 4 lakh farmers. They collect milk through about 1600 producer cooperatives. According to the data of the Ministry of Agriculture, 72 lakh liters are produced per day. 36 lakh liters are consumed by farmers themselves. The remaining 1.2 million liters will officially come to the market. 24 lakh liters comes informally. Some of the 2.4 million liters of informal milk reaches the dairy industry through cooperatives. For collecting this milk, cooperatives get 4 to 5 rupees per liter.
At an average rate of Rs 4.5 per 12 lakh liters per day, dairy cooperatives collect Rs 54 lakh per day. It reaches 1.97 billion annually. "Though nearly two billion rupees have been collected, they have not fulfilled their obligations. "They spend the money that came in the name of farmers on their own," Shrestha said.
He says that the dairy cooperative is only working as a middleman. After the farmers bring the milk to the cooperative, the dairy industry transports the milk by tanker. Farmers get Rs 65 per liter based on 4 per cent fat and 8 per cent SNF. The dairy industry sets the price by adding Rs 6 per liter as transportation cost, packaging cost of Rs 8, overhead cost of Rs 10 and loss of Rs 2 per liter.
In this way, a liter of 4% fat and 8% SNF will cost Rs 96. But the dairy industry has been selling milk on the basis of 3 percent fat and 8 percent SNF. All these add up to Rs 89 per litre. The industrialists claim that the price has been fixed by keeping a profit of 4 rupees per liter for the retailer, 3 rupees for the boothman and 2 rupees for themselves.
'Expenses from shipping, packaging to sending to market. The consumer price is prepared by keeping some percentage of profit on it," said an industrialist, "There is no effort of dairy cooperatives in this. They collect billions of rupees annually. However, they are not in the legal sphere, they have run their own business. Is the cooperative's responsibility only to collect milk?'
General Secretary of the Central Milk Producers Cooperative Association Ram Prasad Acharya claims that the amount received from the dairy industry of Rs 4 to 5 per liter will be spent on the organization's operations. Employees had to be paid. Had to do an audit. The rest of the money stays with the organization. That money belongs to the farmers," General Secretary Acharya said. "We are also doing work to facilitate the farmers. We have also protested on the issue of farmers. He says that the dairy industry has invested in other sectors without giving money to the farmers. He said that the money deposited in the bank by the dairy industry is given to the farmers without stopping even for a day.
