Is this true? Haven’t heard of this news from Pakistani Press.
**Nestle has been accused of exploiting Pakistani dairy farmers by buying up their milk for less than it costs to produce - and selling it back to local people at inflated prices. **
In a new twist to the row over the company’s demands for £3.7 million ($11.5 million) from Ethiopia, the Independent on Sunday says Nestle is bulk-buying cheap milk from peasants and selling it on as “long life” at a profit of 200 per cent.
Details of Nestle’s activities in the Punjab region of Pakistan are contained in a new, as yet unpublished, report by the charity Punjab Lok Sujag, which works for consumer protection in Pakistan.
In it, the multinational is accused of taking advantage of a “totally unregulated” market to offer “ridiculously low” prices for milk it eventually sells as long-life.
**The report, Milk Security in Punjab, highlights Nestle’s use of intermediaries to offer farmers cash up-front for their produce. Nestle, it says, pays farmers less than the milk’s production cost, engendering a cycle of under-investment on farms and growing dependency on producers like itself. While farmers are paid around 21.5 rupees (86c) for two litres of dairy milk, “the industry” charges consumers Rs68 to 92 ($2.75 to $3.70) for the same amount, according to the report. The price of a litre of processed milk, around Rs38, is more than a farmer’s average daily wage, and could buy 4kg of wheat - enough to feed a family of seven for two days.
“There is no restriction on the quantity of milk that a company can collect from an area. This is resulting in milk collectors draining areas dry, resulting in severe food insecurity which in turn creates malnutrition and poverty,”** it says.
Until the 1990s Pakistan survived largely on imports of milk from Western companies such as Nestle.
Francois Perroud, corporate spokesman for Nestle, dismissed the report’s findings as **“bovine excrement”. “We are selling an industrial product. It has been collected at great cost.” **
Nestle has been roundly condemned for demanding a £3.7 million payment from famine-stricken Ethiopia. It claimed the fee is compensation for the nationalisation of a German business it now owns by the country’s 1970s military dictatorship.