In Mauritius, Imported Milk Prices Cause Trouble

06 Jul 2007

Multiple actors show the situation will not improve and local production is the only way out.

80% of the milk consumed in Mauritius comes from Australia and New Zealand.

The price of imported powdered milk is increasing at a regular pace. Yet this is no banal commodity.
This is significant: as long as local offer cannot sustain our domestic market, no other stuff than milk is more linked with the drawbacks of globalization. Except oil. “80% of the milk consumed in Mauritius comes from New Zealand and Australia”, explains Jean-Cyril Monty, the officer in charge of the diversification desk at the Mauritius Chamber of Agriculture. “Now that the price has risen by 40% since the beginning of the year, people are diminishing their consumption.” This rise in price, which he believes will continue with another 30% by the end of the year, is related to multiple factors outside our control: In some countries, corn prices have been pushed up by demand for ethanol fuel, which uses it as raw material. Corn being needed to feed cattle, milk prices have followed suit. As feed costs rise, dairy farmers pass the costs up the food chain. Also, Australia has experienced severe drought for three years. This means decreased productivity of 20 to 30% from dairy farms. Meanwhile, China imports more and more from Australia.
The days when it was current to import from Europe are gone. The subsidies on milk having been suppressed in the EU, the latter encourages production of added value dairy products other than milk. India has stopped exporting to concentrate on its domestic market. And imports from China have been inconclusive.

The need for an enhanced local production cannot be overlooked. “This may take years to be addressed, while the international crisis will go on. But we have no choice and can’t wait any longer”, insists Jean-Cyril Monty. The only advantage for Mauritius is its relatively small domestic market.

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