Milk price goes up on July 1

NAMIBIAN consumers can expect a seven to 10 per cent price increase on local dairy products from the first July.

Namibia Dairies and the Dairy Producers’ Association of Namibia (DPA) have announced a settlement on the raw milk price negotiations that started on May 6. The agreement stipulates that producers of raw milk will, effective from July 1, receive a higher base price per litre of raw milk delivered to Namibia Dairies.The adjustment forms part of an annual increase on raw milk and comes in the wake of an interim special relief given to milk producers in February.”We are proud to have reached a settlement that will ultimately strengthen and create a more independent local dairy industry by assisting local milk farmers to recover their production costs and encourage them to increase production” said Des van Jaarsveld, the Managing Director of Namibia Dairies.At the same time, he welcomed the Ministry of Trade and Industry’s introduction of protection legislation which, effective April 1 2007, authorises a 40 per cent levy on imported long-life milk (UHT milk).”This will assist to ensure that in future Namibia should be less exposed to milk shortages in South Africa and other parts of the world,” he added.Van Jaarsveld said that a competitive local dairy industry was crucial to prevent an undesirable dependence on imported dairy products and further served to guarantee consumer choice and the industry’s ability to sustain jobs.The local dairy industry has in the past absorbed high input costs to avoid an impact on the consumers.This, van Jaarsveld said, can no longer be sustained because of unfavourable global macro-economic conditions ranging from soaring feed and transport costs to competition from heavily subsidised products from the European Union and other parts of the world, which have culminated in lesser regional and local production.Commenting on the consumer price increase, Van Jaarsveld said his company was urging retailers to stick to the retail prices recommended by Namibia Dairies.Japie Engelbrecht, Chairperson of the DPA, added that the parties had further agreed to review the price and cost situation on a quarterly basis to allow a shorter response time to major cost movements at producer and processor level.A temporary shortage of imported cheese and UHT milk is expected as a result of a milk shortage in South Africa.Namibia Dairies said it was monitoring the situation closely and would allocate its 1,8 million litre milk quota to the appropriate product lines to alleviate the situation.The agreement stipulates that producers of raw milk will, effective from July 1, receive a higher base price per litre of raw milk delivered to Namibia Dairies.The adjustment forms part of an annual increase on raw milk and comes in the wake of an interim special relief given to milk producers in February.”We are proud to have reached a settlement that will ultimately strengthen and create a more independent local dairy industry by assisting local milk farmers to recover their production costs and encourage them to increase production” said Des van Jaarsveld, the Managing Director of Namibia Dairies.At the same time, he welcomed the Ministry of Trade and Industry’s introduction of protection legislation which, effective April 1 2007, authorises a 40 per cent levy on imported long-life milk (UHT milk).”This will assist to ensure that in future Namibia should be less exposed to milk shortages in South Africa and other parts of the world,” he added.Van Jaarsveld said that a competitive local dairy industry was crucial to prevent an undesirable dependence on imported dairy products and further served to guarantee consumer choice and the industry’s ability to sustain jobs.The local dairy industry has in the past absorbed high input costs to avoid an impact on the consumers.This, van Jaarsveld said, can no longer be sustained because of unfavourable global macro-economic conditions ranging from soaring feed and transport costs to competition from heavily subsidised products from the European Union and other parts of the world, which have culminated in lesser regional and local production.Commenting on the consumer price increase, Van Jaarsveld said his company was urging retailers to stick to the retail prices recommended by Namibia Dairies.Japie Engelbrecht, Chairperson of the DPA, added that the parties had further agreed to review the price and cost situation on a quarterly basis to allow a shorter response time to major cost movements at producer and processor level.A temporary shortage of imported cheese and UHT milk is expected as a result of a milk shortage in South Africa.Namibia Dairies said it was monitoring the situation closely and would allocate its 1,8 million litre milk quota to the appropriate product lines to alleviate the situation.