The chilled storage facilities are vital in a tropical climate, offering farmers a means to keep milk fresh until it is transported to Nestlé’s factory in Kurunegala more than 200km away.
The new facility adds to Nestlé’s milk collection network across the island, which currently supports approximately 20,000 Sri Lankan dairy farmers. The center is expected to benefit a further 300 farmers in Madhu, comprised predominantly of women, by providing them a route to market.
Shivani Hegde, Nestlé managing director in Sri Lanka, said, “As we continue to work with local farmers and provide them the training and resources they need to produce more high-quality milk, we are enhancing our manufacturing capacity for dairy products in parallel, to support the increasing milk supply.
“We have come a long way since we first began our work in helping to make Sri Lanka’s dairy industry self-sufficient, and are pleased to note the high-quality milk that we are able to collect from local farmers today. It is also extremely gratifying that 30% of our dairy farmers are women, at a time when female participation in the labour force is an economic necessity. Developing a thriving and inclusive dairy industry not only enables us to offer consumers high-quality affordable dairy products, but also serves as an engine for rural development and economic growth.”
Nestlé opened the center in collaboration with the Madhu Livestock Breeders Livelihood Volunteer Society. Previously, the company’s closest chilling center was in Vavuniya, approximately 20km away. The distance meant that Nestlé was only able to collect milk from farmers once a day, very early in the morning. The new facility will now enable Nestlé to collect milk from farmers twice a day, and provide farmers more milking time in the mornings.
Hopes for increased supply
Sivabalan Kunabalan, additional government agent for the Mannar District, said, “Previously, the people of this community faced difficulty in reaping the full potential benefits of their milk. But with this new facility and Nestlé’s strong support, we hope to increase these farmers’ current production of 1,500 liters of fresh milk a day to 5,000 litres by next year.”
Nestlé is currently the country’s largest private collector of fresh milk. It offers training and development programs to local farmers, and set up an infrastructure to support local milk procurement. All its chilling centers are operated by third-parties from the locality. This provides the local community another source of income, in addition to selling Nestlé fresh milk.
In 2017, the company paid out Rs. 3.5bn ($20.3m) to local farmers for procurement of fresh milk alone.
Nestlé Lanka has operated in Sri Lanka since 1906 and manufactures most of its products locally, largely using local ingredients. It is one of the top five companies on the Colombo Stock Exchange in terms of market capitalization, and contributes to the livelihood of over 25,000 dairy and coconut farmers.