The government has increased the price of milk. The meeting of the Council of Ministers held on last week decided to increase the price of milk.
The government has increased the price of unprocessed milk by Rs. 9.1 to Rs. 65.5 per litre, according to Prakash Kumar Sanjel, spokesperson of the Ministry of Agriculture and Livestock Development.
Earlier, the price of unprocessed milk was Rs. 56.4 per litre.
Farmers were complaining that they could not get a fair price for milk. Even a year ago, the government had increased the price of milk.
Sanjel said that the government decided to increase the price of unprocessed milk addressing the demand of farmers as well as encouraging them to increase production.
The Ministry of Agriculture and Livestock Development has recommended prices including the suggestion made by dairy entrepreneurs, and farmers to the Cabinet for approval.
The National Dairy Development Board proposes milk prices in coordination with Dairy Development Corporation (DDC), Nepal Dairy Association, Dairy Industries Association and Central Dairy Cooperative Association Limited Nepal.
That price is implemented through the Ministry of Agriculture and Livestock Development after being approved by the Council of Ministers.
The increment in the price of milk expected encourage farmers to bring milk in the formal sector as large quantity of milk is coming into the local market through informal channels, he said.
There is still a shortfall of around 100,000 litres of milk to meet the market demand, he said, adding that the decision to increase price will help to narrow down the milk deficit by increasing milk supply. Around 765,000 litres of milk has been supplied in the market daily.
According to him, the Dairy Development Corporation is unable to collect milk as required due to the low price fixed by the government than that paid by private dairy association to collect more milk.
He hoped that milk collection of DDC would increase after price adjustment.
Only around 17 per cent milk out of total production comes in the market through formal channels.