Daily Times

KARACHI: The import duty on all kinds of imported milk powder in the country would surge around 60 percent from 45 percent in the wake of duty rise in fiscal budget 2017-18, the leading importers said.

The country imports are around 5,050 tonnes of milk powder a month. The international price of skimmed and fat milk powder currently stands around $1,725 metric tonne.

“The retail price of milk powder will likely to jack up by Rs 20 to Rs 25 a kilogramme, and our imports fill around 40 percent of the country’s annual shortfall of milk,” a senior member of Pakistan Milk Powder Importers Association (PMPIA) Sohail Jano informed.

The milk powder in commercial food and confectionery business increased in wake of increase in the fresh milk prices, which was currently available around Rs 85-90 per kilogramme.

Mr Jano said importers could have been given some relief including import duty on powder milk to 5 percent, it would help to meet the country’s annual milk consumption shortfall on cheaper retail price”.

He was of the view there should be uniform import duty on skimmed and vegetable fat milk to 5 percent.

The skimmed milk powder import stands 60 percent compared to vegetable fat milk 40 percent due to its consumption in the country.

He said increase of milk powder prices in international market had already affected the country’s import cost, which included imports under Afghan Trade and United Nations Development Programme Funds for NGOs in the country.

He said country annual milk powder requirement is around 57, 300 tonnes and we are already facing shortfall of around 25 percent.

The domestic powder milk requirement has increased by around 35 percent to around 34,700 tonnes in the last six months till May 2017.

He said country’s domestic production of powder milk and skim milk (Tetra pack) is around 34,200 tonne, which meets about 35 percent of the country’s demand.

He said country’s annual milk consumption is around 200,500 tonnes including fresh milk with a shortfall of about 30 percent.

Pakistan ranks as the fourth-highest fresh milk producing nation in the world as dairy farming is one of the biggest industries in Pakistan with an estimated 42 million tonnes of milk production per year, having 11.30 percent share in the gross domestic products.

He said 40 percent of powder milk import is from Ireland, 25 percent each from Holland and Sweden and rest of the quantity is being imported from European countries.

“Ten litre of fresh milk costs Rs 900 more than the one kilogramme of milk powder, which costs Rs 475 for same quantity”.

He said the demand by commercial users of milk powder increased by 20 percent during last six months as they switched over more on milk powder.

He said despite having more (per capita) milk than India, Pakistan was forced to import milk powder.

He said skimmed milk is used in preparing ice cream, dairy products and sweets, while dairy industries and sweet merchants also use butter fat milk powder, while loose milk sellers also use vegetable fat milk powder.

From April to October period, imports are increased by 15 percent more than in rest of the months in a calendar year. He said importers have already put proposal to commerce ministry to reduce import duty on skimmed milk and on vegetable fat milk to uniform 10 percent.