Farmers grouped under the Puerto Rico Farm Bureau’s dairy sector could be forced to dump some 7 million quarts of raw milk at the farm level due to the inaction of the government agencies regulating the industry, which has left them with a surplus in production, trade group leaders said Friday.
The milk would be flushed in stages through Dec. 21, representing more than $6 million in losses for the farmers, they said.
In a morning news conference, farmers said among other things, that the government promised them the WIC program would be required to substitute imported powdered milk for fresh milk, so they increased milk production to be able to supply the would-be demand.
The government also said it would implement measures to encourage fair competition in the milk market and approve guarantees at the Government Development Bank, said Gabriel Cordero, president of the Bureau’s dairy sector.
“The problem is that there are both economic and political interests and cronyism. Licenses to import UHT milk been granted in record time,” Cordero said. “A license that takes months to be granted was granted in one day, Dec. 31, 2010. Another license was granted to a person to import milk from New York. These actions should be investigated.”
In March, Gov. Luis Fortuño, established public policy of using fresh milk in the WIC program because it’s healthier, fresh, nutritious and quality. The public policy reportedly got the endorsement of Health Secretary Lorenzo González, but it is getting resistance from many sectors, Cordero said.
“For more than two years we have fought for this not to come to where it is today,” he said. “Since assuming the presidency we have presented an action plan to achieve industry development,” Cordero said, noting he’s received support from several lawmakers, González, and GDB executives.
However, he outed Agriculture Secretary Javier Rivera-Aquino and Cyndia Irizarry, head of the Milk Industry Regulatory Office as the “stumbling blocks” to prevent raw milk from going to waste.
“It is incredible that those who should be protecting farmers have become the projectile that affects us. Today we are requesting the removal of both officials because we gave them space for three years and nothing has happened,” said Cordero.
The dairy industry is the island’s main agricultural sector, generating about $215 million a year. The sector — which has seen its share of troubles in recent years as the economy tanked — employs more than 25,000 direct and indirect jobs.
Under normal circumstances, excess raw milk is processed at the Industrias Lecheras de Puerto Rico, or Indulac, by-products plant in Hato Rey, which earlier this week reported it was at maximum capacity.
Fresh milk sales have dropped
Later in the day, Rivera-Aquino said it was “unacceptable” for dairy farmers to say cronyism is responsible for their current situation, noting there are only six other companies with licenses to produce what Indulac is capable of, five of which were renewals.
“The only new one had to wait seven months for approval, and the total number of licenses is far fewer than those in effect in prior years, which contradicts the dairy sector’s statements,” he said.
He also said a drop in milk consumption is not limited to the public school lunchrooms or the WIC program.
“We’ve also seen this at the points of sale. If we continue to increase the price, we’ll be giving more space to competitors to introduce similar products to the island,” he said. “The question we should be asking ourselves is: how many consumers have stopped buying fresh milk because if the price increases?”
He said the government has been doing its part to try to control production costs, and shore up private investments.
“We urge the dairy sector’s leadership to stop trying to shift the responsibility and take care of the real problems that affect the industry,” Rivera-Aquino said. “The government has a commitment with the sector, but it needs the dairy sector’s leadership will to get over the challenges.”