Despite rising costs, Pelwatte maintains highest quality in its dairy lineup

Pelwatte Dairy, one of the leading local dairy brands in Sri Lanka that produces a range of dairy products saving valuable foreign exchange for the country, announces that its latest revision of dairy product prices will be minimal and will only to meet the recent increase in its production costs.

Pelwatte also assures uninterrupted dairy supplies from its processing lines despite the recent cost escalations.

Among the popular items of Pelwatte product line are Pelwatte Full Cream Milk Powder, Pelwatte Non Fat Milk Powder, Pelwatte Butter, Pelwatte Yoghurt, and Pelwatte Ghee Oil.

The milk volume absorbed by the Pelwatte supply chain is extensive -and provides best value for money since Pelwatte insists on highest quality milk intakes. It adheres to the well-known industry adage that “A good dairy product starts with good raw milk.”

Mr Akmal Wickramanayake, Managing Director of Pelwatte Dairy Industries, explains: “On average nearly 8.4 liters of raw milk is processed to manufacture just one kilo of milk powder, which shows the high level of extraction required to produce the powder. As Pelwatte ensures high levels of quality assurance –one hundred percent and no less-across its overall dairy chain and manufacturing processes, it is clear that it is not feasible to ‘cut corners’ in this critical process just to lower production costs. As a result of not resorting to shortcuts, Pelwatte avoids delivering products that are unfit for consumption. Thus when overall national dairy supply chain costs (of production) escalate, prices of Pelwatte products too are compelled to face revisions. However, efforts are made to keep these revisions at minimal levels.”

Increases in the farm gate prices of raw milk is a key reason for latest price revision. It has been increased significantly and current average price vary from Rs 90 to Rs 105 per litre based on the region of produce.

“Compared to the previous year, raw milk purchase price has increased by 25%. Also Pelwatte is compelled to adjust the final sale prices due to increase in other costs such as cost of power/energy supplies increased by 20%, packaging increased by 40%, and transport and labor increased by 35%, adds Mr Akmal Wickramanayake.

The raw milk supply chain for the Pelwatte range of products is derived from the 12,500 strong farmer-base in Sri Lanka which directly depends on Pelwatte for their livelihood. The Company has a network of 50 milk collection centers spread across Uva, Eastern, Central, Northwestern, and Northwestern provinces with a huge monthly milk pool of 4.5 million liters of fresh milk. Amid COVID crisis the company paid Rs.3.18 Bn to the farmers (in 2020/21, which is a 70% year on year increase from 2019/’20). In addition, Pelwatte maintains many free Farmer Welfare initiatives to uplift their living standards, a practice that makes the same farmer-base continuing to return to Pelwatte’s fold every year.