The col­lapse of milk pro­duc­tion in T&T over the last 15 years should be blamed on the low prices that Nestl� pays for milk from lo­cal farm­ers, says Chris Med­ford, pres­i­dent of the Cat­tle Farm­ers' As­so­ci­a­tion of T&T.

"Be­tween 2001 and De­cem­ber of 2015, T&T's milk pro­duc­tion dropped from 13 mil­lion kg per year to un­der three mil­lion last year. The main prob­lem for this is the cheap price of milk that farm­ers sell. Farm­ers can­not con­tin­ue pro­duc­ing milk at a loss. It means farm­ers are work­ing for free," Med­ford told the Busi­ness Guardian by phone last Fri­day.

He said, in 1982, farm­ers re­ceived 95 cents from Nestl� for a litre of milk and 90 cents from the State, a to­tal of $1.85.

To­day, in 2016, Nestl� pays farm­ers $2.35 and the State pays $1.50, a base price of $3.85 per litre of milk.

He not­ed that one litre of milk weighs one kilo­gramme.

"The year 1982 was the last time farm­ers sold their milk at a prof­it. Now, in 2016, the base price is $3.85. The State on­ly gives a sub­sidy if a farmer sells to Nestl� and no one else. If you sell your milk to Ram­saran Dairy Prod­ucts, who is a proces­sor, you will not get a sub­sidy. So, in 34 years, the to­tal in­crease that farm­ers got from Nestl� for the milk they sell is $2 per litre," he said.

He said the cost of pro­duc­ing a litre of milk far ex­ceeds what they are sell­ing the milk for.

"Every­thing else is go­ing up. In 1982, you got a work­er to work for $50 a day. To­day, no one wants to work on the dairy farms, and if a farmer is lucky to find some­one, the least the scamps are ask­ing for is $250 dai­ly. But farm­ing can­not pay that," he said.

In 2006, the Min­istry of Agri­cul­ture did a sur­vey and the av­er­age price then to pro­duce a litre of milk was about $4.60.

In 2006, farm­ers were get­ting $3 per litre and he said it shows how far farm­ers were and are still be­hind.

Med­ford said he no longer sells milk to Nestl� as he would have gone "bank­rupt" by now.

He last sold milk to Nestl� in 2008. He now sells to oth­er busi­ness­es which, he said, pays "con­sid­er­ably more" for his milk.

"I have found a new, niche mar­ket for my milk. My farm is in Carlsen Field and I have been say­ing for years that milk pro­duc­tion is de­clin­ing and be­ing re­placed by im­port­ed milk. Re­cent­ly, we had Moo Milk from Ger­many. I now sell to the for­eign em­bassies, restau­rants from In­dia, the Hilton Ho­tel and oth­ers in the pri­vate sec­tor," he said.

No gov­ern­ment help

Apart from the col­lapse of milk pro­duc­tion, Med­ford al­so said that two thirds of the di­ary farms are now out of busi­ness.

He said the con­cen­tra­tion of farms are in Carlsen field, Waller­field and Va­len­cia.

"We have lost the dairy pro­duc­ing farms, even though the lands are there. We have al­so lost two thirds of the dairy cat­tle. We have al­so lost farm­ers."

He blames pre­vi­ous gov­ern­ments for al­low­ing the cri­sis that ex­ists in the di­ary farm­ing sec­tor to­day.

"The gov­ern­ment says if a farmer plants grass, he gets a sub­sidy. If he fences, he gets a sub­sidy. If he re­pairs his pen, he gets a sub­sidy. Since the 1990s, the State has not re­newed leas­es for farm­ers and you need the leas­es to qual­i­fy for the sub­si­dies. Some peo­ple from the Min­istry of Agri­cul­ture were on my farm two weeks ago and I point­ed it out to them. I buy ve­hi­cles, I fence, I plough and I have nev­er got one cent in in­cen­tives from the Gov­ern­ment. I now own 70 cows but, back in the day, I owned al­most 300," he said.

He al­so said Nestl� has not been help­ful to farm­ers.

"Nestl� took the po­si­tion, if farm­ers are not hap­py with their price, we can go oth­er places."

Re­act­ing to the news that the Gov­ern­ment wants to help farm­ers pro­duce their own milk, he scoffed and laughed it off call­ing it a "big joke."

He said the so­lu­tion for farm­ers is for the Gov­ern­ment to en­sure the sell­ing price is more than the price of pro­duc­tion.

"Nestl� is mak­ing a hor­ren­dous prof­it off farm­ers. They are pay­ing farm­ers lit­tle and are mak­ing a pound and a crown. This has to change."

Min­is­ter of Agri­cul­ture

In an email to the Busi­ness Guardian on Mon­day, Clarence Ramb­harat, Min­is­ter of Agri­cul­ture, said the coun­try has had a long re­la­tion­ship with Nestl� and has ben­e­fit­ted from its tech­ni­cal as­sis­tance.

How­ev­er, he said farm­ers are un­hap­py with the price while Nestl� has said the price it pays to lo­cal farm­ers is among the high­est it pays any­where in the world.

He re­peat­ed the re­marks he made at an eco­nom­ic fo­rum at the Uni­ver­si­ty of the West In­dies (UWI), St Au­gus­tine in April.

"The dairy farm­ers have to make a de­ci­sion whether they will con­tin­ue to sell to Nestl� or whether they will look for their own mar­kets, in­clud­ing val­ue added op­por­tu­ni­ties. It is a de­ci­sion that has to be made."

He added: "At the same time I made the point that the last ad­min­is­tra­tion im­port­ed two pas­teuri­sa­tion plants, one of which is al­ready in­stalled in Long­denville and the oth­er is ear­marked for Waller­field. These, if com­mis­sioned, may pro­vide farm­ers with op­tions, but the de­ci­sion on how these plants are to be used is a de­ci­sion the min­istry still has to make, af­ter dis­cus­sions with the dairy farm­ers."

Ide­al price

Dr Norell Lon­don, a dairy farmer and a re­tired pro­fes­sor of so­ci­ol­o­gy at the Uni­ver­si­ty of West­ern On­tario, be­lieves it is nec­es­sary to raise the price of milk famers sell to Nestl�.

Lon­don has been in dairy farm­ing for over 40 years and sup­ports the views of the pres­i­dent of the Cat­tle Farm­ers' As­so­ci­a­tion that the price of milk needs to be raised.

"The in­puts are cost­ly. The feed, the chem­i­cals, labour and posts for fenc­ing are all ex­pen­sive. The Gov­ern­ment owns the posts and we have to pay them an ex­or­bi­tant price for the posts. One post costs $50 for a poor farmer," he told the Busi­ness Guardian last Fri­day by phone.

Lon­don, who owns 44 cows, has his farm in Waller­field. He said labour is al­so ex­pen­sive.

"I pay my three work­ers $5,000 month­ly for each. They have been with me for over 10 years."

He thinks that the "rea­son­able" price farm­ers should be sell­ing a kilo­gramme of milk for is $6.50.

"Many farm­ers are un­hap­py and are on­ly in the busi­ness be­cause they can­not do bet­ter. "

He said dairy farm­ing can be prof­itable but the Gov­ern­ment must con­sid­er the economies of scale and oth­er fac­tors.

"To sur­vive and make a de­cent liv­ing, a farmer needs to pro­duce about 300 kg dai­ly. That means a milk­ing herd of about 30. Then there is the spin off cost of feed right now," he said.

Hap­py cus­tomer

Lucy Tor­res, dairy farm own­er in Turere, San­gre Grande, spoke to the Busi­ness Guardian last Thurs­day.

She has 49 cows and sells milk dai­ly to Nestl� and has been do­ing busi­ness with the com­pa­ny for 42 years.

She sells 120 kg of milk to Nestl� dai­ly and she es­ti­mates it costs her about $2,500 month­ly to run her farm.

"I on­ly buy about 10 bags of feed from Nestl� for the week," she said.

Un­like some oth­er farm­ers, she is hap­py with her re­la­tion­ship with Nestl�.

"Some farm­ers might not want to say it but we are in a very good re­la­tion­ship. Nestl� is a sure mar­ket and every day they take your milk. Every day the trucks come here."

She spoke about Nestl�'s ar­ti­fi­cial in­sem­i­na­tion (AI) pro­gramme.

"If you have a cow in heat, the per­son who works with Nestl� will come and in­sem­i­nate the cow. They used to charge $100 for those who were not in the pro­gramme but for those in the pro­gramme, they cost would be $50. Be­cause of the change in the econ­o­my, Nestl� gives you that free. To im­port the bull se­men from for­eign coun­tries is not cheap."

She con­sid­ers Nestl� to be an im­por­tant part­ner of the dairy farm­ing com­mu­ni­ty.

"Nestl� is not an en­e­my. You can tie a cow in the field to eat grass, but you can­not make it eat. Some of the farm­ers, all they want is more mon­ey. I do not have a prob­lem with Nestl�," she said.

About Nestl�

Nestl� had pro­vid­ed in­for­ma­tion to the Busi­ness Guardian news­pa­per in March and, ac­cord­ing to that in­for­ma­tion, it be­gan milk pro­duc­tion in T&T in 1962.

Nestl� al­so in­di­cat­ed they pro­vide sup­port to the coun­try's dairy farm­ers in the ar­eas of farmer train­ing and sem­i­nars.

There is a dairy de­vel­op­ment pro­gramme which aims to help dairy farm­ers de­vel­op sus­tain­able and prof­itable milk pro­duc­tion in a shared-val­ue re­la­tion­ship. This pro­gramme was ini­ti­at­ed on 22 farms with an av­er­age farm size of 22 cows in 2009 and con­tin­ues to­day.

There is al­so the for­age and feed project.

"The Mu­la­to Grass Project, ini­ti­at­ed in 2006, helped farm­ers es­tab­lish new pas­tures with this im­proved grass. A par­al­lel sup­ple­men­tal feed project–un­der­tak­en in part­ner­ship with Na­tion­al Feed Mills–es­tab­lished a 16 per cent dairy ra­tion specif­i­cal­ly for sup­pli­ers to Nestl�s fac­to­ry. To­geth­er, these two projects have in­creased cow pro­duc­tiv­i­ty from 7.5kg/cow per day in 2010 to 10.3kg/cow per day in 2012, while sig­nif­i­cant­ly re­duc­ing the amount of feed used to pro­duce 100 kg of milk from 66 kg to 44 kg. The re­sult is di­rect on-farm sav­ings which have in­creased farm­ers' pro­duc­tiv­i­ty and prof­itabil­i­ty."

Nes­tle al­so re­ferred to the farm man­age­ment project.

"Nes­tle's agri­cul­tur­al ser­vices de­part­ment works close­ly with farm­ers to im­ple­ment im­proved farm man­age­ment tools and tech­niques. We help farm­ers with da­ta col­lec­tion, analy­sis and feed­back for short-and medi­um-term plan­ning. Farm­ers re­ceive a de­tailed month­ly re­port high­light­ing key per­for­mance in­di­ca­tors over a four-month pe­ri­od, which shows them the true prof­itabil­i­ty of their op­er­a­tions and high­lights high costs and in­ef­fi­cien­cies."