About 150 dairy farmers risk being rendered destitute as they will have to forgo K51 million monthly income derived from selling milk to Dairibord Malawi, which is closing operations at the end of June this year.
Zimbabwe Stock Exchange (ZSE)-listed milk company Dairibord Holdings Limited (DHL), the parent company of Dairibord Malawi, has announced
that it is pulling out of Malawi following losses by the local entity.
Dairibord Malawi was buying about 300 000 litres of milk from nine milk bulking groups, translating to an annual income of K612 million for dairy farmers, figures from Malawi Milk Producers Association (Mmpa) show.
Mmpa national director Herbert Chagona said in an interview on Monday that while the closure of the company means affected dairy farmers will now have to look for new markets, the situation could exert pressure on the remaining six milk processors which could affect prices.
He said: “Unfortunately, this time of the year, milk is saturated on the market. The farm-gate price is low because the milk sales are low. The decrease in the number of processors would mean the few processors would take advantage of this predicament to monopolise the market by reducing farm-gate price of milk currently at K170 per litre.”
Dairibord Malawi officials refused to comment on the imminent closure of operations on Monday, but some employees said management had already communicated the decision to them and that they were just waiting for formalities.
DHL chief executive officer Anthony Mandiwanza told Zimbabwe Mail Dairibord Malawi has failed to attract potential investors and was not successful in securing credit facilities from banks to capacitate it. n