Milk: Farmers are forced to desert industry in crisis as prices plummet
was the massive import of milk powder in 2013 by dairy processing companies that first accelerated the drop in domestic milk prices, and subsequently the collapse in milk collection from farmers.
Song Liang, a dairy analyst, said growing consumer preference for imported milk has also been fuelled by worries over the safety of some domestic milk and milk products, particularly milk powder.
Industry analysts fear that if domestic rawmilk prices keep dropping this year, and the massive inventories at some of the larger companies remain high, more farmers in more regions will be forced to pour their milk down the drain, or kill their animals.
Earlier this month, the Ministry of Agriculture instructed farming departments at all government levels to help dairy farmers sell their milk. These included urging processing companies to closely monitor sales of fresh milk and offer subsidies to farmers.
Local governments are also being asked to offer financing to farmers who have been affected by the slump in demand.
According to a ministry circular, local dairy departments have already been asked to set up reporting systems to record the weights and numbers of dairy products being declined, collected, or poured away.
Li Shengli, chief scientist at the National Modern Dairy Industry Technological System and a professor at the China Agricultural University, said China’s dairy consumption should be dominated by pasteurized milk, and not roomtemperature milk products which have a very short expiration period.
Shen Danyang, spokesman for the Ministry of Commerce, said on Jan 21 that imported milk powder should not be blamed as the only culprit for farmers’ doldrums.
Shen also highlighted the large gap between prices of domestic and oversea dairy products, rising imported dairy products, and low levels of technology used by domestic dairy producers, noting that the industry has historically suffered from fluctuating levels of supply and demand, in both domestic supply and also imports.
For example, Shen said, dairy imports have been growing at more than 20 percent over the past five years, even rising 37 percent in 2013. Contact the writers at firstname.lastname@example.org and email@example.com