27 July 2017 12:02 am
The Finance and Mass Media Ministry this month has slashed the import duties on milk powder to negligible levels, as the global dairy prices show signs of continuous recovery after reaching a 10-year low in late-2015.
The import duties on all varieties of milk powder were Rs.225 per kilogramme or 20 percent, but effective from July 8, 2017, a Rs.223 per kilogramme duty waiver will be in effect, setting the recoverable Customs import duty at Rs.2 per kilogramme.
The whole milk powder prices increased 0.3 percent at the New Zealand dairy auction last week, compared to the first week in June, continuing a recovery, which has almost doubled the prices since a year ago.
The government and private sector data indicate that in Sri Lanka, local milk production can currently meet only 42 percent of the demand, making the country depend on the imported milk powder. The previous government attempted a policy of self-sufficiency in milk production.
The current government has also shown an interest in developing the local dairy industry.
Although the value of dairy product imports fell 0.6 percent in 2016 to US $ 249 million, due to the low price levels of milk powder during the first three quarters of the year, the volume of imports increased 15 percent to 94,011 metric tonnes compared to 2015.