February 22, 2011

India's milk export ban to affect local dairy firms

Indian dairy processors are all set to face shortage of raw materials with the country's imposition of ban on the export of powdered milk.

Most of the dairy producers in the country depend on powdered milk from India during dry season.

"Confectionaries, biscuit factories and dairies that depend on powdered milk will be hardly hit by the Indian decision," said Niranjan Shrestha, managing director of Sujal Dairy.

India has banned exports of skimmed milk powder, whole milk powder, dairy whitener and milk-based food products for children. The country had recently announced the ban to ease supply of powdered milk in domestic market on the back of declining milk production.

Krishna Gopal Shrestha, general manager of Dairy Development Corporation (DDC), said the ban would affect milk production during lean season when Nepali dairy producers depend heavily on powdered milk.

Amid growing shortage of fresh milk, DDC, the state-owned dairy producer, has been importing fresh milk from Indian state of Bihar to maintain supplies in the market.

Domestic production fulfils only half of the total daily requirement of 800,000 litres of milk across the country.

D N Pathak, executive director of National Dairy Development Board (NDDB), said local dairy producers had imported around 6,000 tonnes of powdered milk from different countries, mainly India, last year.

"As an immediate measure, we can evade the ban by importing powdered milk from other countries. But we need to be self-sufficient on powdered milk by boosting domestic production of milk," he added.