By Staff Reporter
Consumers will be paying more for dairy products following an increase in the price of raw milk that took effect from yesterday.
Namibia Dairies and the Dairy Producers Association said yesterday as a result of a 10 percent increase in the price of raw milk per litre, dairy products will go up by an average of 5.7 percent.
Namib Dairies Managing Director, Desmond van Jaarsveld, in a joint statement issued by the company and the association, explained that raw milk prices increased because of the rising costs of stockfeed which make up the bulk of the production costs of raw milk on local dairy farms.
Milk prices increased by 50 cents on April 1 and again in July last year when the producers received an increase on raw milk delivered to Namibia Dairies.
The July increase was part of an annual increase on raw milk, which came in the wake of an internal special relief given to milk producers in February. The agreement, which resulted in the price adjustments, was reached on May 16.
The increase was passed on to the consumer who paid between seven and 10 percent more than what they were paying for fresh milk, cheese, UHT milk and other milk products.
When the price of raw milk was increased in February last year, Namibia Dairies said this was necessary to avert the collapse of the dairy industry, which could lead to dependence on imports and increases in retail prices due to lack of local competition.
The price of fodder alone increased by close to 40 percent in 2006.
Fodder at that time accounted for 80 percent of the total cost of one litre of milk produced.
The international market trend is that there is a continued increase in raw material prices and shipping costs that are putting pressure on local stockfeed prices.
The statement quoted Namibia Agricultural Union Manager: Commodities, Harald Marggraff, as saying that global demand has outpaced the production of animal feed leading to a shortage of the stockfeed thereby putting pressure on their prices.
Marggraff said effects of these shortages threaten the existence of local producers and the country’s primary dairy sector.
Van Jaarsveld said the 5.7 percent increase would enhance the sector’s ability to sustain jobs both in the primary and secondary sectors of the dairy industry.
Namibia has 17 milk producers that employ 211 workers, who in turn support 1ǟ