Nepali dairy industries have requested the government to lift the restriction on imports of skimmed milk powder or full cream milk powder to avert possible shortages in the domestic market.

Prahlad Dahal, president of the Nepal Dairy Association, said the state-owned Dairy Development Corporation (DDC) and privately-owned Nepal Dairy Association and Dairy Industry Association have written to the Ministry of Agriculture and Livestock Development to lift the ban on imports of skimmed milk powder.

In 2017, Nepal imported milk worth $18.7 million.

Nepal imposed import restrictions on skimmed milk powder in 2018 after imports started to balloon. It was briefly lifted in 2019.

But in April that year, farmers objected to the re-opening of imports saying that they could not sell their milk. The government quickly placed a total ban on the import of skimmed milk powder from India.

Nepal has maintained a ban on Chinese milk and dairy products since 2008.

Rajendra Prasad Yadav, executive director at the National Dairy Development Board, told the Post that three different organisations have requested the board to facilitate them, by allowing the imports as a temporary arrangement.

“The dairy associations have cited reasons such as Covid-19 and the prevalence of lumpy skin disease among the animals as the reasons behind the drop in milk output,” said Yadav. “We are holding a discussion on Wednesday to know the details. We will also discuss possible steps to address the issues and prevent a crisis.”

Dahal said they have been raising the issues for the past four months.

According to the report of Commercial Agriculture for Smallholders and Agribusiness, the consumption requirement for milk in Nepal is 92 litres per person annually, and the country produces 72 litres per person, fulfilling 80 percent of its requirements.

It is estimated that the average current deficit is around 550,000 litres of fluid milk per day with 10–20 percent variability during the lean season (March-July) and the flush season (August-February), the report said.

According to the Department of Livestock Services, production is increasing at a rate of 4 percent annually, but the demand has been growing at 8 percent.

As supply is not keeping pace with the demand, the demand-supply mismatch is likely to widen over the years without substantial changes in milk production. This also means that the sector is at a very rudimentary stage, as only 14–16 percent of farmers are commercialised, according to the report.

“As the lean season has begun, we are in no condition to operate the dairy plants without the imports,” said Dahal.

“We want the authorities to allow the imports until the Tihar festival, which ends in mid-November.”

Until 2006, Nepal used to see the milk holiday.

Except for a few instances, the country has not faced a milk holiday since 2006 after the entry of a number of private dairies.

There are multiple factors causing the reduction in milk output.

Dahal said that commercial animal husbandry has been badly affected by the Covid-19 pandemic as many farmers left the occupation after incurring massive losses.

“The reduction in demand during the pandemic also caused financial stress to the farmers and they started cutting their budgets to buy expensive animal fodders,” he said.

As a result, the inadequate nutrition reduced the fertility of cows and buffaloes.

The dairy sector suffered another blow due to the economic slowdown.

“Nepalis started to drink less milk due to a slump in their incomes while the milk prices have gone through the roof,” said Dahal. “The overseas migration trend, too, has affected the dairy sector.”

According to the report, among the 3.8 million farming households in the country, 95 percent have dairy animals.

Most of these farmers are producing for household consumption, with only about 500,000 farming households engaged as both producers and sellers.

“But nowadays, families that used to produce milk in villages have become consumers because of their increased earnings through remittances,” said Dahal.

The government should bring programmes to encourage commercial animal husbandry, he said. “Only grants won't do. The dairy sector needs a complete overhaul.”

Sanjeev Jha, general manager of the DDC, told the Post in a recent interview that the corporation is facing a milk deficit of around 60,000 litres, daily. “The period between mid-April and mid-August is a lean season when milk production falls markedly.”

“There is a ban in place on milk imports, but given the shortage, we need to consider lifting the ban because we are struggling to meet the daily demand,” Jha added.

The Kathmandu Valley’s daily demand for milk is 75,000 litres. The demand for yoghurt is 3,000 litres.

In India too, the milk production remained stagnant in 2022-2023 due to lumpy skin diseases in cattle across several states and the effect of Covid-19 pandemic in the form of stunting of the animals, according to the Financial Express.

India’s milk production was reported at 221 million tonnes in 2021-2022.

According to the Food and Agriculture Organisation, India is the highest milk producer in the world which contributed 24 percent of global milk output in 2021-2022.

According to the Commercial Livestock Survey, a report published by the National Statistics Office in 2021, there are a total of 6,486 medium and large commercial livestock enterprises.

According to the survey, 15,380 dairy cows produce a total of 45,803 tonnes of milk on their average lactation cycle, while 10,841 buffaloes give 23,231 tonnes of milk on average.