Cash strapped farmers brace for impact of dairy closure
by Emmanuel Joseph
President of the Dairy and Beef Producers Association, Brian Allen told Barbados TODAY this evening that the Pine Hill Dairy’s decision to further cut their supplies by shutting down its processing plant every other week, starting next month, would now make it impossible for them to service their loans.
“The Dairy has already cut our quotas by 25 per cent and this latest measure would mean an additional 50 per cent reduction in our income. Some new farmers who have invested heavily in their business, can not now service their loans and that means the banks would take up their properties. Water bills and NIS, all of that done,” the farmers spokesman declared.
He noted, too, that their already dire circumstance would be made even worse with the decision by the School Meals Department to cut the volume of milk it buys from Dairy, because this would trickle down to the producers.
Allen said the industry would not be able to survive the week-on-week-off supply to the Dairy, which was announced during an emergency meeting held this morning.
Pointing out that it would be impossible for this arrangement to work, the farmer indicated that the industry could not continue to function under this for three months, in that it would have to dump milk and lose production.
“We would still have to feed the cows and milk the cows when the Dairy is shut down. If we don’t milk the cows they would get mastitis and die,” declared the association’s head. “No self respecting dairy company anywhere in the world, would implement such a measure. I can’t see industry surviving this for three months. We need to look at imports,” he added.
He noted that with their quotas already cut by 25 per cent, the latest reduction in supplies meant a further income cut of 50 per cent, leaving farmers with only 35 per cent income.
Sources have told this newspaper that the School Meals Department had awarded the tender for the total importation of powdered milk.
Chief Executive Officer of the Barbados Agricultural Society James Paul described the entire affair as “totally unacceptable”.
“The BAS was caught by surprise by the action of the Pine Hill Dairy. This will have tremendous consequences for the dairy farmers which therefore is going to have a further impact on the profitability,” Paul contend.
“We will be calling on the government since Pine Hill Dairy claims that imported products are causing them problems in the market. We, within the BAS are calling for an immediate ban on all milk imports that compete with the Pine Hill Dairy,” Paul told Barbados TODAY from Grenada.
He said this is a case of clear damage to the industry and reasoned that the price of feed would most likely go up.
Faced with a high glut of milk stock that could soon expire and a new cut in its supply to the School Meals Programme, the PHD announced it has been “forced” to shut down its processing plant every other week, starting next month.
Director of the PHD Richard Cozier told Barbados TODAY this afternoon, that beginning September 9 and running for three months, the Dairy would operate on a week-on-week-off basis.
“Unless we can move lots of milk in a short space of time, we have no other option. The key is to get milk consumption increased,” the executive suggested. He said he hoped that between the farmers and the ministry of agriculture, the matter could be solved.
“We have a little room to talk between now and September 9,” added the director.
However, Cozier emphasised that any initiative to avoid the periodic shut down, must involve a “very clear understanding that it was not going to make the situation worse”.
Acknowledging that the farmers would be hit hard by the Dairy’s decision, he said the PHD had to introduce the harsh measure in order to protect the integrity of the milk stock, which had a limited shelf life.
“The farmers understand that while they would be adversely affected, the Dairy also had a responsibility to the community,” reasoned Cozier.
Reporting on an emergency meeting this afternoon with the Minister of Education Ronald Jones, the PHD director told this newspaper, the minister said there was a misunderstanding regarding the School Meals supply. He indicated that Jones informed them while the volume of milk would be cut, the department would still buy “an unspecified” amount of flavoured milk in the coming years.
A delegation from the PHD and farmers representative body sought an emergency meeting with the Minister of Agriculture, Dr. David Estwick today, but officials from both sides told Barbados TODAY the minister promised to see them on Friday, since he was holding talks with the sugar industry.