Dionne Rose, Staff ReporterAGRICULTURE MINISTER Roger Clarke on Thursday defended the Government's planned revival of the local dairy industry and rejected a recommendation from Lasco Foods Limited against the establishment of a Dairy Development Board.
Lasco Foods had made the recommendation in a submission to Parliament's joint select committee examining legislation to create a dairy board to regulate the industry.
In the written submission, Patrick Lawrence, group managing director at Lasco Foods, discouraged the Government from going that route and said the establishment of such a board would place "crippling pressures on the industry" and would see its demise.
Mr. Clarke, who is also chairman of the committee dismissed the submission.
DESTROYING OUR INDUSTRY
"We are dependent solely on imported milk ... it might be cheap now but when our industry is totally destroyed that cheap milk powder will not be around," the agriculture minister said.
He said the threat of a shortage of affordable milk products was evident during Hurricane Ivan which struck the island in 2004.
"Hurricane Ivan came and we did not have them, nothing came in cheap," he said. "Things moved up astronomically and therefore what we are about is not just to protect the dairy food industry, we are trying to find a way to sell some milk and produce some milk efficiently."
Mr. Lawrence also opposed the imposition of a cess on trade in dairy products as outlined in clause 18 (1) of the bill. He said this would mean additional input costs to the company and a reduction in its profits.
"We must point out that Lasco currently pays 50 per cent duty on the importation of milk powder and applies a mark-up of 10.3 per cent," he said.
The Lasco representative argued that anything more would make the product unmarketable and would remove it from the hands of the people who need it most.
WAIVER OF DUTY
In response Dr. Paul Jennings, chief executive officer of the Jamaica Dairy Board, said that while this may be true, the company also enjoys a waiver of duty on skimmed milk powder. That duty waiver he suggested was not being passed on to the consumer.
"The difference between the cost of milk powder coming into Jamaica and what it is sold at to the final consumer is of the order of 145 per cent or higher," he said.
Opposition committee member Dr. St. Aubyn Bartlett said however that the company had raised some real issues and should be heard out.
The committee subsequently wrapped up its deliberations with Mr. Clarke indicating that the committee's report would be tabled in Parliament early in the next legislative year.
