Pine Hill Dairy (PHD) is negotiating a subsidy with Government in an effort to revive the local dairy industry which has been plagued with several challenges for years.
Shafia London, country manager of Banks Holding Limited, the parent company of PHD, told Barbados TODAY in an interview that Government’s intervention in the industry was urgently needed to pull the sector out of hot water.
Although London did not disclose any details about what PHD had proposed, she said she was satisfied with the progress of the meetings and had faith that a positive outcome would be realised.
“We have been in discussions with Government and we are quite optimistic. They have been going very well and we have submitted various proposals that are being actively reviewed and which would allow some sort of relief to the farmers and relief, we are hoping, for the consumer. We are hoping to close those discussions soon,” she said.
“A subsidy is one of the suggestions (we put forward); not a straight subsidy of course, because it has to be linked to various indicators so that all parties benefit.
“We have been meeting with the Ministry of Agriculture and the Ministry of Innovation and both made a commitment to assist and make sure the industry does not collapse.”
London said increases in the cost of production coupled with competition from cheaper imported milk products were posing a serious challenge to the sector and it was time for Government to play a greater role in the industry as other governments did internationally.
“Globally in the milk industry, governments usually support the industry with subsidies and that allows most, if not all, the exported brands to enter this market and the local industry that is not subsidised in the same way, is not able to compete effectively.
“It is a growing threat. A lot of those milks are coming out of the EU (European Union) and those have significant support from their governments. I’m not expecting that the government of Barbados would be able to match the level of the support that they give to their farmers. However, it is significant enough for them to compete with us in a very unfair way and we need to continue to monitor it.”
President of the Barbados Beef and Dairy Producers’ Association, Annette Beckett said the dairy industry was in a serious bind and some form of intervention was definitely needed.
She said the industry has been experiencing challenges for years and she was also concerned about the declining number of dairy farmers, which dropped from about 22 to 14.
On the farmers’ end, she said milk producers were trying their best to keep their heads above water and though faced with issues, it was not a case where they were running their operations “ineffectively or inefficiently”.
She said farmers partnered with the Barbados Agricultural Society (BAS) in 2016 and 2020 to import pregnant heifers to give their milk production a boost and also to improve the genetic strains of their cattle.
However, she said the increase in fuel, electricity, feed and other inputs,was a major blow to the industry.
Beckett added that the availability and quality of hay, partly due to drought-like conditions, was another significant issue. At the same time farmers had to cope with water bills that had tripled in some instances because of the Garbage and Sewage Contribution (GSC). Those bills were only adjusted from June following the introduction of the single water rate for the agriculture sector on May 1st.
“The increase in production is a goal that everybody is trying to reach but there are several things working against us and one is the cost of everything that we do. Everything has increased by a minimum of ten per cent and there has not been an increase in our income and in some cases some farmers are operating at a loss,” she said.
When asked about the cess that was first proposed in the Budgetary Proposals of June 2015, under the previous administration, Beckett said she was unsure if that arrangement would ever come into play.
“Government, farmers and PHD would have to find another way to assist the industry if it doesn’t come into being because I think none of us wants to see the end of the dairy industry. If the cess goes into being it would help in that we would get 25 cents or 30 cents more for our farmgate price.”
Beckett said farmers had seen a slight increase in their farmgate price from PHD when it moved to $2.73 from $2.60 which represented the first increase in the price for more than ten years.
London said PHD was trying to put incentives in place to assist farmers to boost their production.
She added that the dairy industry played a critical role in the island’s economy and every effort had to be made to keep it afloat.
According to her, Barbados’ high quality of milk was internationally recognised as better than most countries’ in the world, and this high standard was a source of pride for many Barbadians.
She said the employment generated by the industry coupled with the energy used to process dairy products contributed to the economy in a significant way.
sheriabrathwaite@barbadostoday.bb
