Milco to reduce prices of Highland milk powder in Sri Lanka

SRI LANKA –  Milco, the government-owned dairy company in Sri Lanka, is set to reduce the prices of its Highland brand milk powder in a move aimed at providing relief to consumers.

Agriculture and Plantation Industries Minister Mahinda Amaraweera announced that starting next week, the price of a 400-gram packet of Highland milk powder will be reduced by Rs. 75, while a 1-kilogram packet will see a significant price cut of Rs. 190.

This decision was communicated during a press conference held at the Agriculture and Plantation Industries Ministry, where the minister was joined by Milco Chairman Indika Guruge and other officials.

The announcement clarified that while the new, reduced-price milk powder will be available in the market immediately, the existing stock, which was distributed earlier, will still carry the old price.

As such, the price reduction will officially take effect next week once the new stock becomes available.

“The reduction in milk powder prices is a noteworthy development for Milco, particularly after a challenging period that saw disruptions in the company’s milk collection and production over the past year.”

Minister Amaraweera pointed out that despite these difficulties, Milco has successfully turned around its fortunes and is now a profitable state-owned enterprise.

The company’s improved financial position and increased production capacity have enabled it to offer the price reduction and pass the benefits on to consumers.

Highland milk powder is recognized as a high-quality local product, and it continues to be a dominant force in the Sri Lankan dairy market.

 According to the minister, Milco’s strong market presence has resulted in a competitive advantage over other companies, many of which are facing setbacks.

This success has also led to an increased tendency for farmers to sell their raw milk to Milco, as the company is now seen as a stable and reliable business partner.

Indika Guruge, the chairman of Milco, highlighted that the company’s stock value currently stands at Rs. 2.5 billion, and the current supply of Highland milk powder is sufficient to meet consumer demand for the next four months.

With nearly two million 400-gram packets of milk powder in stock, the company is well-positioned to continue its operations without any immediate concerns about shortages or production delays.

Milco’s price reduction follows a series of price hikes that occurred over the past few years. In 2021, the company raised the price of a 400-gram pouch of Highland milk powder by Rs. 90, while a 1-kilogram pouch saw an increase of Rs. 225.

This adjustment brought the price of a 400-gram pouch to Rs. 470 and the price of a 1-kilogram pouch to Rs. 1,170.

However, despite these earlier price increases, Milco has since managed to stabilize its pricing, resisting further hikes in the face of rising costs in the dairy sector, particularly for packaging and taxes.

In contrast to Milco’s decision to lower prices, imported milk powder brands have seen consistent price hikes, with some 400-gram sachets increasing by Rs. 100.

Despite these external pressures, Milco remains committed to keeping its prices affordable for local consumers. The company has emphasized its dedication to supporting the local market by promoting liquid milk products alongside its milk powder offerings.

The chairman also indicated that Milco is aiming to release sufficient stock into the market over the next few weeks, ensuring that consumers have access to affordable dairy products without having to face additional price increases.

By leveraging its financial stability and focusing on increasing production capacity, Milco is confident in its ability to meet the demands of the local market and maintain its leadership position in Sri Lanka’s dairy industry.

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