Prime Minister KP Sharma Oli has ordered private dairies to pay farmers affected by money claims not paid for two years. But private dairies are suffering amid a dairy downturn, excessive stockpiles, and muted consumer demand. Half of the payments to farmers have been made, with the Dairy Development Corporation (DDC) having cleared some payments in half in the past 20 days. The corporation itself has Rs700 million in dues, and it plans to settle the remaining dues slowly.
Private dairies owe Rs 2 billion, 10 percent of unsold products worth Rs 4 billion. On top of that, rising milk prices and falling demand are the major concerns. Nevertheless, some private dairies, including members of the Nepal Dairy Association, have settled their dues. DDC is looking to raise revenue by exporting raw cheese and butter as a loss minimization attempt.