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August 26, 2019

Milk issue worsens as retailers ignore warning against increasing price


August 26, 2019

The issue of increased milk prices in the city has aggravated after the associations involved in the milk trade have said they are ready to face any action for increasing the milk price as they responded to Karachi Commissioner Iftikhar Shallwani’s decision to initiate a crackdown against those selling milk at high rates.

The rate of milk in the city was increased after the associations of dairy farmers announced a per-litre increase of Rs10 in the milk price, which was accepted by the Milk Retailer Association.

Currently, there are three associations of dairy farmers that supply milk to Karachi – the Karachi Dairy Farmer Association, the Dairy Farmer Association, and the Karachi Dairy and Cattle Farmers Association. They have jointly increased the wholesale rate of milk from Rs85 to Rs95 per litre, due to which the retail rate of milk is now Rs110 per litre as the retail price of milk has to be generally around 10 per cent more than its wholesale price.

Earlier in the month of July, the retailers had refused to accept the dairy farmers’ increased rate and took the matter to the Commissioner Office, which is responsible for notifying the milk price.

In the second week of July, a meeting was held at the Commissioner Office in which all the associations involved in the milk trade were present. It was decided there that milk would continue to be sold at its previous price in the city until July 17, after which the price would be revised in accordance with the rate of inflation and the rise in the production cost of milk determined by the State Bank of Pakistan (SBP).

No meeting since then, according to Amjad Ali of the Milk Retailers Association, took place. “We had no option but to increase the milk price,” he said and added that it had been one month after the farmers had increased the milk price but the retailers so far did not pay them according to their increased rates.

“Farmers have now threatened us with stopping milk supply,” he said, adding that if that happened, they would be able to get milk only from the open market, where the rate was Rs140 per litre. He said they wanted the commissioner to listen to them and address their issues.

“The dairy farmers have already announced to supply their milk directly to the open market now,” Ali shared. He said in such a situation, the retailers association had no other option but to increase the price.

Responding to the threat of crackdown, he said if the Commissioner Office took any action, they would bring their animals on the roads and go on strike. Ali demanded that the commissioner share with them the new milk price determined by SBP.

Meanwhile, Cattle Farmers Association Chairperson Shakir Umer extended the association’s support to the retailers and said if the latter would go on strike, the farmers would join them. He lamented that the commissioner had no time to look into their issues. When the associations, according to him, tried to contact the Commissioner Office, they were told that Shallwani was busy in rain-related work in the city.

Umer recalled that the commissioner office had formally agreed on revising the milk price after a certain time period. Under an agreement between the milk associations and the Commissioner Office, the price of fresh milk was supposed to be revised after every four months, in accordance with the food inflation rate notified by the SBP.

It was April 1, 2018, when the price of milk was officially notified the last time. As per the agreement, the price had to be revised on August 8, 2018, which was not done. This agreement, Umer said, was also endorsed by the Sindh High Court in its March 3, 2018 order. He added that he had written some 13 letters to the commissioner to determine the new milk price as not doing that would be contempt of court.

Crackdown initiated

Meanwhile, according to a press statement from the Commissioner Office, Shallwani directed all the deputy commissioners of the city to initiate a crackdown against the violation of the milk price fixed by the government.

The commissioner announced that milk price had not officially been raised and the official price of milk was still Rs94 per litre. The crackdown was to continue until the violators stopped charging the excess price for milk, the statement read.

In District East’s Gulshan-e-Iqbal area, action was taken against milk sellers flouting the government rate of milk. Mashallah Milk shop in Gulshan-e-Iqbal, according to the statement, was fined Rs20,000 while a fine of Rs10,000 was imposed on Nagori Milk shop. The shopkeeper of Bismillah Milk shop was arrested for one day and fined Rs5,000.

In District Central, a total of Rs55,000 fine was imposed on 10 shopkeepers for violating the official price of milk.