Make the transactions of farmers, cooperatives and dairy industry transparent

जेष्ठ १२, २०८२

सम्पादकीय

Make the transactions of farmers, cooperatives and dairy industry transparent

The news of non-payment by the government-owned Dairy Development Corporation (DDC) and private dairy industry has also become a regular 'update'. Now, it has been established that even the cooperatives that collect about two billion worth of milk from the farmers have invested elsewhere without paying the farmers. Such behavior has violated not only the general principles of the market, but also the basic rights of farmers.

Therefore, if the government is to allow the farmers to remain in the profession, it is delaying one moment to intervene in solving the problem. All processes and structures between milk producers and consumers should be made transparent and accountable. If the problem is real, it should be exposed, if it is artificial, action should be taken against those involved. This is the basis for any industry to thrive. However, it is difficult to save the milk enterprise and business in the current situation. 

About 600,000 farmers are directly involved in milk production, while Nepal Dairy Industry Association and Nepal Dairy Association collect milk from about 400,000 farmers. According to the data of the Ministry of Agriculture, 7.2 million liters are produced per day, of which 3.6 million liters are consumed by the farming family. Out of the remaining milk, 1.2 million liters are formally marketed and 2.4 million liters informally. Around 1600 cooperatives are active in collecting milk from farmers. For collecting 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 around Rs 54 lakh per day.

It reaches 1.97 billion annually. While the investment and effort of the cooperative in the overall process is very low. After the farmers bring the milk to the cooperative, the dairy industry transports the milk by tanker. Cooperatives are not involved in the production process, nor in the processing and marketing of milk after collection. By sitting in the role of a middleman and collecting milk, they collect about two billion annually. However, farmers have to wait for months to get payment from them. One aspect is that the dairy industry does not pay on time, there is also a complaint that the cooperative does not give the paid money to the farmers on time.

It has been revealed that some cooperatives stopped paying farmers and invested in other areas and some used farmers' money to pay bank interest. Farmers are in trouble with this trend of cooperatives. There is a barrier between their natural and regular income. Therefore, it is necessary for the concerned municipality to study the amount received by dairy cooperatives from dairy, payments made to farmers and investments elsewhere.  The

question is about the dairy industry. During the dry season, milk production is low, dairy industry and DDC have to resort to selling the stock to repay the farmers. However, farmers have not been able to get 3.5 billion rupees from private dairy and 1.5 billion rupees from DDC. Some farmers have not received payment for almost 6 months. Thus, from the dairy industry to the cooperatives, no party is found to be sensitive to timely payments to the farmers. Rather, it seems to be guided by the intention to shock the farmers as much as possible.

This situation needs to end as soon as possible. Because agriculture itself and animal husbandry are more complex. Because for animals, there is a daily expenditure on feed, nutritious food, care etc. That requires a regular source of income. Therefore, the government should create a situation where the amount of milk is paid and regular. If the income and expenditure of the farmers and the overall economic behavior of the farmers are not managed from the animal husbandry centered on the sale of milk, the milk production and supply system will be confused. Likewise, their natural concerns should also be addressed to prevent the migration of farmers from the profession. 

Along with making cooperatives and the dairy industry accountable, the structural problems they face must also be addressed. For example, in recent years, the demand for milk has not increased, market prices are erratic, and unsold dairy products due to overstocking have added challenges to the financial stability of industries. A government-fixed price system reduces business flexibility, forcing dairies to incur losses. The direct impact of this will also affect the payment of the farmers. Solving these multifaceted problems requires attention to long-term structural reforms, not just the flow of blame.

For example, an independent commission or committee can be formed to create a policy to strike a balance between farmers, cooperatives, dairy industry and consumers. Also, legal arrangements like 'Farmer Payment Protection Act' can be made to ensure payment of farmers. This can ensure regular payments within a fixed period. A regular audit and monitoring system should be developed through the local municipality to ensure the financial transparency of the cooperative. Only by implementing such measures can transparency, accountability and reliability be maintained in the dairy production and supply chain .

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