Pelwatte to explore continued local dairy self-sufficiency Post COVID-19

Pelwatte to explore continued local dairy self-sufficiency Post COVID-19

(FASTNEWS | COLOMBO) –  The local dairy industry leader, Pelwatte, has pledged to ensure
continued exploration towards establishment of self-sufficiency in the local dairy industry. At a
meeting con-ducted with the Senior Members of the Government of Sri Lanka, when probed on the
threshold of self-sufficiency post COVID-19, in all agricultural and food products in Sri Lanka,
Pelwatte denoted their commitment and practical possibility towards supplying continuous dairy
products during the COVID-19 situation and post COVID 19.

Following the continued curfew and other contingency measures that were enforced by the GOSL
since 20th March 2020, it was declared by the Government that they would enforce a continued
limitation on import of non-essential items and certain types of food commodities.

As such, it was a need of the moment that the local Food & dairy processors contributed their proposals, suggestions
and issues that would support the GOSL to conduct a detailed study on mechanisms to ensure self-
sufficiency in all agricultural and food products while overcoming the strains of the short time
allowed, to champion the challenge. Heeding to the government’s request, Pelwatte has brought up
crucial information in terms of uplifting the local dairy farmers which would pave the path towards
the self-sufficiency of the dairy industry in Sri Lanka.

“At present, we are ensuring our farmers are benefitted with the best possible price for their raw
milk/ farm gate prices, however the company and the local dairy industry at large is not in a
position to provide more support to the farmers in terms of upgrading the farming enterprises
through micro financing. This is an area we would require the government’s support, as that would
be a giant leap in establishing long term self-sufficiency in the dairy industry. Such an initiative
would entail improvement of the feed/diet of cattle by high yield grass, fodder, silage and
concentrated feed, as well as enabling farmers to get more heifers that would help increase the size
of their heard, possibly from climatized, native or regional breeds,” chronicled, Akmal
Wickramanayake, Managing Director, Pelwatte Dairy Industries.

“Local dairy processors have shown time and time again that their product quality is far superior
and definitely more fresh than imported products. We at Pelwatte guarantee the time taken from
Farm Gate to Retail Outlet shelves is Less than 72 hours, which cannot be claimed by imported
brands. During the COVID-19 crisis, citizens themselves became more convinced that they will use
local brands. But challenges lie for local brands to be able to fill the shelves with enough stocks
regularly to ensure that all citizens have access to fresh local dairy products, and the key to this lies
in the success of our supply chain and steady sustainable growth of the small holder dairy farmers,”
emphasized Wickramanayake, highlighting the challenges in the path to self-sufficiency in the local
dairy industry.

Pelwatte identifies feeding the cattle high energy rations with the correct balance as a key to
increasing daily output of milk per cow by as much as 50% within a short time span of 2 months.
This would have an inadvertent positive impact towards the self-sufficiency of the industry as it is
one of the key challenges faced by Small holder dairy farmers.

The GOSL has awarded the local dairy industry with a price increase of Full Cream Milk Powder,
with the new MRP set at Rs.945 per kg and Rs 380 per 400g as of 28th April 2020, as a first step in
the direction to self-sufficiency. This was based on the appeal made by the Local Milk Powder
Manufacturer’s that at the pre-existing set Full Cream Milk Powder MRP they were barely breaking

even. This put the local dairy processors in a quandary, in terms of supply chain improvements, i.e
extension of farmer network. Accordingly, it was requested from the government to increase the
MRP that allows the processors to generate the profits that could be reinvested in Small Holder
Farmer Extension Network.

According to Laksiri Amaratunga, General Manager, the Governments initiative to take steps to
establish ‘the correct price’ through the increased MRP would enable them to reinvest in the supply
chain that consists of 90% small holder farmer who do not have financial means to expand the
heard numbers and improve productivity. The majority of these farmers use outdated methods of
farming and animal husbandry, which is a contributing factor towards the low productivity.

“We are planning to improve productivity of each individual farmers by a minimum of 10%, using
the increased profit margin as a result of the MRP price increase. In terms of numbers, this denotes
a 100% increase in Milk Collection within 12 to 18 months. As such, it would enable local
processors including Pelwatte to further increase in market share and reduce the importation of
dairy products. In other words, we would be contributing towards reducing foreign imports into the
country. This would be the best case scenario, considering the depreciation of Rupee in the face of
Rs.200 per USD exchange rate. It is obvious the country cannot afford to continue buying imported
food and dairy products, it is high time we zero in on possibilities of uniform self-sufficiency,”
added Amaratunga.

The COVID-19 crisis has more than ever established the need of strengthening local production
across many industries. The present context of the dairy industry is such that two-thirds of the local
dairy demand is met with imported milk powder. More than 100,000 metric tons of powdered milk
is imported per year in Sri Lanka, costing over US$ 400 million annually. The burden of this cost
would be felt on the local economy in multiple levels if a strong footing is not taken against this.
Pelwatte, as a local dairy processor believes that Sri Lankan Diary industry is equipped to cater the
demand of not only milk powder but also with fresh milk, Butter, Cheese, Ice Cream and other
value added dairy products. Pelwatte and the rest of the local dairy industry therefore would whole-
heartedly join hands with GOSL’s initiative to establish a self-sufficient dairy industry in Sri Lanka.

About Pelwatte
Pelwatte Dairy Industries Ltd is a fast growing organization engaged in the manufacture and distribution of
superior quality dairy products country-wide. Many growth areas have been identified and the Company is
moving at a rapid pace to emerge as a force to reckon within the industry. Pelwatte Dairy Industries is
engaged in producing milk products of international quality and the flagship Pelwatte brand enjoys the
complete confidence of customers who have been our source of strength and motivation.

Photo Caption
Image 1 :Pelwatte Dairy continues production amidst COVID 19, following health protocols.

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