Thursday, 24 September, 2020
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Dairy sector bears losses of over Rs. 20b from COVID-19



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By A Staff Reporter
Kathmandu, Sept. 13: Owing to the prolonged nationwide lockdown and prohibition order imposed to control the spread of COVID-19, the dairy sector has faced a loss of above Rs. 20 billion.
Covid-19 crisis incurred a loss worth Rs 20 billion in the industry since the beginning of lockdown in late March, said Babu Kaji Panta, deputy executive director of National Dairy Development Board (NDDB).
He said that the collection of milk by the private sector and state-owned Dairy Development Corporation (DDC) had reduced on average by 50 per cent over the last five and a half months of the lockdown.
The government had enforced nationwide lockdown since March 24 to prevent and control the COVID-19 pandemic.
“Around 450,000-500,000 litres of milk is collected on a daily basis from the farmers across the country during lockdown against the normal collection of around 900,000-1,000,000 litres a day,” he said.
The demand for milk has significantly decreased in Kathmandu Valley, which has affected collection in the villages as Kathmandu is one of the major markets for milk.
The demand for milk and milk products in Kathmandu Valley has decreased by 50 per cent to 350,000 litres per day from its previous demand of 700,000 litres per day, he said.
“We have just conducted a zoom meeting with the private dairy associations and other concerned authorities to discuss the problems of the sector and their solution. The NDDB has proposed to the Ministry of Agricultural and Livestock Development to compensate the losses faced by the dairy farmers and businessmen,” he said.
According to him, NDDB has proposed with the government to provide Rs. 5 per litre cash incentive to the dairy farmers based on their losses.
Radha Krishna Sapkota, chairman of Nepal Dairy Association, said that milk collection through the formal sector had decreased by above 50 per cent in lockdown.
The country's dairy farmers produce around 6 million litres of milk every day, but the amount consumed in the market at present is less than half of it.
Of the total production, collection of milk stands at 17 per cent from the formal sector and 33 per cent from the informal sector whereas about 50 per cent milk of the total production is consumed by the farmers themselves.
“We were unable to collect milk from the farmers after the decline in consumption. The demand for milk dropped sharply in the urban areas including Kathmandu Valley following closure of hotels and restaurants and party venues,” he said.
However, dairy products worth Rs. 300-350 million are being imported monthly in the country during lockdown.
He expressed his hope that the market of milk would improve in the days to come as local administrations of various districts, including Kathmandu Valley, had eased the prohibition orders.
However, the losses will increase if the lockdown is extended further, he said.
It will be a relief for the dairy farmers and the industry if the government provides them soft loans and compensates their losses, he said. 

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