GOVERNMENT is stepping in to resolve a dispute between the Fiji Co-operative Dairy Company Limited (FCDCL) and the Fiji Dairy FDL) over the finalisation of a Milk Supply Agreement.
Director for Animal Health and Production, Tomasi Tunabuna said government would bring both parties together to sort out their differences for the benefit of the industry.
The dispute reaches back to 2011 when the diary industry was effectively separated into two operations — FCDCL as the producer, and FDL as the processor.
FCDCL CEO Sachida Nand said as part of the separation, farmers were told the price to be paid for their milk would be decided by a Milk Supply Agreement.
"The agreement has never been signed. This has resulted in FDL setting the price without input from the farmers and one that is highly in dispute," he said.
He said the co-operative welcomed the commitment by government.
"The Fiji Co-operative is comprised of 264 dairy farmers and their families. They are the backbone of the dairy industry. And these are trained farmers essential to the sustainability of the industry.
"We want them to succeed. We want them to increase their productivity and we want to encourage them with a fair and equitable milk price for their efforts."
Mr Nand said the country was importing $70million worth of dairy products a year and much of that money should go to the farmers through import substitution.
"But at 87 cents a litre for premium milk paid by FDL, a price that has decreased in the last two years despite increased costs; there is no incentive to invest in the industry, to increase production.
"Everyone in Fiji will benefit with the finalisation of the Milk Supply Agreement that will lead to a healthy productive dairy industry."
While no date had been confirmed for the meeting, Mr Tunabuna said government would do all it could to address the issue of milk pricing.