Higher prices force Iranians to drink less milk

Business Materials 4 October 2012 16:07 (UTC +04:00)

Azerbaijan, Baku, Oct. 4/ Trend M. Moezzi

High prices in Iran have forced Iranians to consume less milk, according to the statistics. The 68 to 73 litres of milk were consumed per capita by Iranians annually is sharply lower than the 291 litres they should be drinking.

Since Iran's government started its subsidy reform plan in December 2010, milk consumption has dropped six per cent while raw milk production has declined 15 per cent, said Hossein Chamani, a spokesman for the Iran Dairy Industries Company.

The official urged Iran's government to ensure that the price for a kilogram of raw, unpasteurized milk is 9300 rials (equals 75 cents based on the USD official exchange rate) in order to make it affordable.

That rate would earn dairy farmers a 17 per cent profit, but although the government was to provide feed at lower prices to the farmers, that hasn't happened.

Instead, the Iranian Students' News Agency (ISNA) reported that dairy farmers have complained that they have had to pay as much as 12,000 rials a kilo for soybean meal and 4800 rials a kilo for wheat bran.

The subsidy reform plan which phases out eliminates government subsidies for petrol and other commodities, and the international sanctions imposed against Iran have sharply pushed up the inflation rate in the country.

That was evident in a May 2nd report by the Central Bank of Iran (CBI) on retail food prices which said dairy prices had gone up 51 per cent in the last year.

From the start of Iran's solar year on March 20 to the end of August, the price of milk and dairy prices have been raised four times, the Etedaal.ir website reported

Mr. Chamani, the milk industry spokesman, said the government should import large amounts of feed and powdered milk to help keep prices down.

The dairy industry is a competitive one in Iran with 900 brands active in the market. Until 1996, the country was one of the biggest importers of milk products.

However it has become self-sufficient and exported a little over $44,000 (USD) in milk last year.