Dairy Association raises concerns for local dairy industry


The prevailing forex crisis in Sri Lanka has severely impacted many industries in the country including the dairy industry, the All Island Dairy Association said yesterday (20).

As an industry with endless potential to help the economy, the dairy industry is one of the most important in the country. However, rising costs, scarcity of feed, vitamins, fuel and fertiliser, and the difficulty in importation of maize has greatly impacted the industry’s survival. The All Island Dairy Association (AIDA) calls for immediate action to prioritise the importation of raw materials to help sustain the future of the industry.

Binesh Pananwala, President of AIDA, commented on the crisis, “Proper micronutrients and vitamins from quality feed is an essential part in our industry as the animals play an integral role in the supply chain. It is imperative that feed such as maize and silage is readily available as it would greatly assist in sustaining the industry”.

The lack of quality animal feed has largely disrupted the dairy industry’s supply chain. If the livestock does not receive essential micronutrients and vitamins from maize and silage, the physical wellbeing of the animal is affected, which thereby affects milk production. Veterinary professionals have continuously expressed their growing concern for the wellbeing of these animals due to the shortage of feed and medicines such as antibiotics and anaesthetics required for operations.

A.C.H. Munaweera, Consultant and General Manager of AIDA shared his thoughts, “The impact of the forex crisis is felt in multiple facets of our industry. The industry is already struggling to sustain itself and due to the lack of fuel, storage facilities, fertiliser, and feed, we are unable to meet the demand for fresh milk and powdered milk. Our production has reduced a great deal already and if not rectified, will spell disaster going forward.”

The Government of Sri Lanka has provided permits for the importation of maize on a case-by-case basis; however, fodder importers and dairy companies have struggled to sustain imports due to the forex shortage. The shortage of foreign exchange makes it difficult for banks to honour Letters of Credit (LCs) for importers to bring in the necessary raw materials needed to sustain the industry.

The local production of milk is drastically falling due to the lack of quality feed, and the supply of imported milk is reducing due to the rising prices. Currently, locally manufactured feed is used to maintain the livestock, however, due to the lack of fertilisers and various other concerns, the supply of feed is diminishing. As a result of this, the dairy industry will struggle further to meet the demand for both powdered and fresh milk going forward. If the feed does not meet the required nutritional standard, the consequences would be severe as it would affect the health of approximately 900,000 animals.

The dairy industry is in dire need of revival, as its deterioration will have a great impact on a plethora of industries and consumers alike. It is imperative that those measures are put in place to prioritise imports of raw materials for feed, which would lead to high levels of production and sustainability.