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Dairy farmers demand better deal from milk companies   2010-05-27 - Viet Nam News

Dairy farmers in HCM City have raised their voices against new requirements by milk companies that they say are forcing them to sell their products at very cheap prices.

They describe the new demands as "complicated and unreasonable".

According to farmers, milk companies have added many terms to trade contracts without discussing them with farmers, who claim most of them are disadvantageous.

Specifically, milk companies now demand that farmers provide supplies that are just sufficient - or even less than the agreed amounts.

As a result, farmers say they have been selling milk to companies and traders at very cheap prices. Sometimes they even have to throw it away because the price is too low.

Farmer Nguyen Van Hai, who has 50 cows in Binh Chanh District, said he collected 600kg of milk a day but was allowed to sell only 300kg according to the new, one-sided contracts.

Hai said he had difficulty in selling surplus milk. Milk companies also made regulations that they could take milk samples for tests at any time without farmers being present. Those who disagreed with the test result were forced to terminate their contracts.

Companies were refusing to buy milk if the cows were even suspected of being infected from disease or there were "disadvantageous problems" that affected milk consumption without supplying any details.

According to farmers, test results are meaningless unless witnessed or approved by both sides. However, the farmers had to sell milk at cheaper prices or have their contracts broken.

Farmer Nguyen Van Tan from Cu Chi District said there were so many complicated technical terms that he and other farmers could hardly understand their meaning.

Most signed contracts without being fully aware of any disadvantages.

According to dairy farmers in District 12, 10 years ago, milk brought VND7,100-7,200 (US$0.37) a kilo, while cow feed was VND80,000 ($4.2) a sack. Now feed costs VND145,000 ($7.6) a sack, but milk prices are unchanged.

Statistics from HCM City’s Farmers Association show that dairy cow farmers suffer losses at present prices, especially farmers with only a few cows.

According to the association, the price of milk should be VND8,000-9,000 a kilo, enough to give farmers a small profit. Luu Van Tan, a representative of the Friesland Campina Viet Nam Company, said the company always made farmers aware of any changes to contracts.

He said they could ask his company’s staff for more information or call a hotline.

Tan said the company had added stricter regulations to encourage farmers to raise better cows producing higher-quality milk.

He claimed the company would increase milk prices by VND200-400 a kilo if the milk met standards.

Nguyen Van Tui, deputy head of the farmers association’s economic unit, suggested milk companies should share the VND300 per kilo profit from milk collecting stations with farmers to satisfy both interests.

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