Business

‘Need to spread awareness on packaged milk’

Dairyland CEO says concerns on UHT process need to be addressed

Farhan Zaheer April 12, 2017

PHOTO: REUTERS

KARACHI: Concern over the ultra-heat treatment (UHT) process is the biggest hurdle in the growth of packaged milk industry in Pakistan, Sulaiman Monnoo CEO of Dairyland (Pvt) Ltd, said while talking to reporters at the factory Tuesday.

"But these very concerns are an opportunity for the industry," said Monnoo, referring to the criticism the industry has faced in recent times. "This means people want to know and we just need to tell them this milk is safe to consume."

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Unlike many other regional countries, packaged milk industry has seen slower growth in Pakistan. The size of the industry is still less than 10%.

Some industry experts believe the price difference (packaged milk is about 30% expensive) between packaged milk and loose milk is a major reason why the industry is unable to grab a larger market share. But Monnoo said concerns are the top issue, and pricing comes later.

The perception of packaged milk is that in order to preserve its three-month shelf-life several preservatives, including metals, are mixed, making the milk unsafe for consumption. The industry denies these allegations.

Dairyland started its operations in 2009 and later established a milk packaging plant next to its dairy farm. The company started with 500 cows, it now has 4,000.

"Our sales are growing and we see faster growth in coming months because there is so much growth margin for the packaged milk industry," he said. When Dairyland started its operations, its average cow used to produce 18 litres of milk per day, which has now gone up to 26 litres.

Monnoo said this can be raised up to 40 litres with proper breeding and care of animals.

After deliberating for years, last year the government slapped tax on the inputs of dairy sector at 17% standard rate by withdrawing the zero rating regime. Packaged milk industry strongly opposed the decision, which according to the industry, resulted in the increase of packaged milk price by 6-7%.

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Industry officials say this has dented the growth of the packaged milk industry because it further widened the gap in prices of UHT treated and loose milk.

Published in The Express Tribune, April 12^th, 2017.

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COMMENTS (2)

Xak | 7 years ago | Reply The CEO is very wrong if he says that price isnt the issue. It definitely is the biggest one; he should talk to the middle class people and listen to them. People in the urban centers are well aware of the qualities. A sane businessman would very rightly state that if these corporations can bring their prices down up to the level of open milk, people will dramatically switch to the packaged milk. In short these corporation would be doing a favor to the people by pushing out the nasty price pushing open milk mafia. Try achieving this Mr. CEO. I believe even Saudi Arabia has milk cheaper than here in Pakistan, an agrarian economy. The second issue is counterfeited packages (as the industry puts it), the polluted supply chain or the packaging not holding up to the claims (milk getting rotten pretty quick or while in the packs).

Hasan | 7 years ago | Reply Packaging (and its printing) can be a health risk, not the milk.

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