No rise in milk powder prices

Irangika Range

COLOMBO: The Government will not permit an increase in the price of a 400g milk pack, Trade, Marketing Development, Co-operatives and Consumer Services Minister Bandula Gunawardana declared yesterday.

He said this decision was taken due to several reasons such as the stabilisation of the rupee, a drop in the price of milk powder in the world market and the Government's successful distribution of three special milk powder packs at concessionary rates through the Co-operative sector.

Addressing a press briefing Minister Gunawardena said he saw no reason for a price increase on a 400g milk pack.

"We have permitted milk powder importers a Rs.80 price increase for each 400g milk pack subject to a maximum retail price of Rs.275 for the last six months following the agreement signed by the Government with importers," Minister added. He said that the Government has also granted several concessions to milk powder importers.

The import duty on every kilogramme of milk powder was reduced from Rs.50 to Rs.5 for the last six months and the tax relief will be further continued.

He said that the agreement will be over by end of this month and the Consumer Affairs Authority received several requests from milk powder importers to increase the price by Rs.25.

CAA officials met the milk powder importers yesterday evening to discuss the possibilities of reducing milk powder.

The Government is providing three types of full cream milk powder packs (400g) holding a small profit margin under the concessionary rates as a relief measure to consumers.

The full cream Candy milk powder packs (400g) priced at Rs.245 are available at co-operative outlets while Sathosa full cream milk powder packs (400g) are provided at Rs.255 through Sathosa. A special milk powder pack (400g) is also available at Rs.230 from Milco.

Consumers should not entertain fears of any shortage of milk powder since these three types of milk packs are available sufficiently at Sathosa and Co-operatives the Minister emphasized.

He said there is almost a daily increase in milk powder prices in the World Market due to a crisis in the milk powder industry.

The Minister said that the CAA has permitted three price increases for 400g milk powder packs since January 2007.

In order to provide concessions to consumers, the Government has gazetted milk powder as an essential item.

"We stipulated a maximum retail price of Rs.275 for a 400 g of milk powder pack as a relief measure and this maximum retail price cannot be increased unfairly without permission from the Consumer Affairs Authority," he said.