GEISHA KOW­LESSAR ALON­ZO

Ca­roni dairy farmer Suresh Rami­ah spent the last three years in­vest­ing his life sav­ings in­to his dairy farm, wait­ing for 23 young heifers to ma­ture and dou­ble his milk pro­duc­tion by ear­ly next year.

But just as his mul­ti-year in­vest­ment was set to pay off, Nestlé T&T an­nounced a strate­gic re­view of its op­er­a­tions—in­clud­ing the po­ten­tial clo­sure and sale of its his­toric Val­sayn fac­to­ry—leav­ing Rami­ah and the na­tion’s re­main­ing dairy farm­ers with­out their pri­ma­ry com­mer­cial buy­er.

“Now they come to tell us they want to shut down the fac­to­ry. It is re­al hard,” Rami­ah said, his voice heavy with frus­tra­tion over the sud­den threat to his liveli­hood. He es­ti­mates his loss­es to be in the thou­sands as he al­so ex­pressed con­cerned that his cows could face the pos­si­bil­i­ty of be­ing slaugh­tered.

Last Thurs­day, the T&T sub­sidiary of Swiss multi­na­tion­al food and bev­er­age con­glom­er­ate an­nounced that it was re­struc­tur­ing glob­al­ly and ex­it­ing the do­mes­tic dairy and juice sec­tors. That sent shock­waves through the lo­cal agri­cul­tur­al sec­tor.

Nestlé has served as the pri­ma­ry life­line and sole ma­jor buy­er of fresh milk for over 60 years for T&T’s re­main­ing dairy farm­ers.

In 2023, mo­ti­vat­ed by an of­fi­cial bul­letin, Rami­ah poured his life sav­ings in­to ex­pand­ing his farm as he chose to ful­ly back the do­mes­tic dairy in­dus­try.

With Nestlé pulling out of man­u­fac­tur­ing, the threat of hav­ing no buy­er at all looms large with Rami­ah—who has an award from Nes­tle for de­liv­er­ing the high­est sup­ply of fresh milk—fac­ing a mas­sive sur­plus with ze­ro mar­ket se­cu­ri­ty.

“Who is go­ing to buy all that milk? No­body,” Rami­ah said.

The stakes ex­tend far be­yond his own liveli­hood as the fa­ther of three al­so taught his chil­dren how to milk the an­i­mals, hop­ing they would suc­ceed him.

Third-gen­er­a­tion dairy farmer Satish Heera from Carlsen Field al­so faces an im­me­di­ate op­er­a­tional and fi­nan­cial cri­sis.

“Un­like the poul­try in­dus­try, you can­not pause dairy pro­duc­tion. Cows must be milked twice a day. If Nes­tle stops buy­ing, we can­not store it, and we can­not leave it in the an­i­mals. With­in days, the cows get in­fect­ed and die,” Heera said.

Heera is among an es­ti­mat­ed 65 to 70 dai­ly dairy farm­ers across T&T fac­ing sud­den ru­in.

While Nes­tle promised to con­tin­ue pur­chas­ing milk un­til “year end,” man­age­ment has not pro­vid­ed a de­fin­i­tive cut­off date, stat­ing the tran­si­tion is “un­der re­view” for the next two months.

This ex­act sen­ti­ment is echoed by Waller­field dairy farm­ers, who are equal­ly fear­ful of the im­mi­nent fall­out.

Strand­ed with­out clear di­rec­tives from cor­po­rate or state of­fi­cials, pro­duc­ers re­port that anx­i­ety over their fi­nan­cial sur­vival has reached a crit­i­cal lim­it as the year-end dead­line ap­proach­es.

They added a two-month de­lay is a lux­u­ry they do not have.

In Waller­field, dis­tressed farm­ers have al­ready be­gun load­ing their live­stock on­to trucks to sell off their herds.

“If every farmer is forced to liq­ui­date their live­stock si­mul­ta­ne­ous­ly in two months, the as­set val­ue of these an­i­mals will com­plete­ly crash,” Heera warned.

The fi­nan­cial fall­out would be im­me­di­ate.

Lo­cal dairy op­er­a­tions have func­tioned un­der a strict state-sub­sidised mod­el where farm­ers are legal­ly re­strict­ed to sell­ing ex­clu­sive­ly to Nes­tle.

The gov­ern­ment pays Nestlé a sub­sidy of $1.50 per litre while the com­pa­ny’s pay­ment to dairy farm­ers amounts to $3.86 per litre of raw cow’s milk, Heera ex­plained.

How­ev­er, he said the cheap­est 100 pound bag of feed is $186 while the most ex­pen­sive is $212.

With­out a guar­an­teed buy­er, the eco­nom­ic loss­es are un­sus­tain­able.

Resh­ma Kalas­deen, a dairy farmer for over 40 years, cal­cu­lates that los­ing the Nes­tle mar­ket would cost her $1,500 dai­ly.

For larg­er farms with hired labour, loss­es would reach $5,000 a day.

Fur­ther­more, the cri­sis threat­ens the farm­ers’ land se­cu­ri­ty.

State agri­cul­tur­al leas­es ex­plic­it­ly man­date that dairy farm­ers main­tain ac­tive live­stock on their acreage.

If forced to sell their cat­tle due to a lack of a com­mer­cial mar­ket, farm­ers would vi­o­late their lease terms, leav­ing them vul­ner­a­ble to state land re­pos­ses­sion.

While gov­ern­ment of­fi­cials re­cent­ly met with Nes­tle ex­ec­u­tives to dis­cuss cor­po­rate “job preser­va­tion,” no farm­ing rep­re­sen­ta­tives were in­clud­ed in the talks.

“Job preser­va­tion for fac­to­ry man­age­ment does not equal job preser­va­tion for dairy farm­ers,” Kalas­deen stat­ed, adding, “The state claims it wants to boost agri­cul­ture, yet we are com­plete­ly ex­clud­ed.”

“You need a lawyer oc­ca­sion­al­ly and a doc­tor a few times in your life, but you need a farmer three times a day,” Heera said not­ing, “We work through the weath­er to feed this coun­try, and we will not al­low our liveli­hoods to be qui­et­ly de­stroyed.”

Lee meets with Carlsen Field farm­ers

On Tues­day, Min­is­ter of Hous­ing and Mem­ber of Par­lia­ment for Ca­roni Cen­tral, David Lee, met with Carlsen Field farm­ers to dis­cuss their on­go­ing con­cerns.

The farm­ers wel­comed the meet­ing and ex­pressed hope that a res­o­lu­tion could be reached.

Lee told the Busi­ness Guardian that he is al­so work­ing to arrange a joint meet­ing be­tween the farm­ers, the Min­is­ter of Trade and In­dus­try, and the Min­is­ter of Agri­cul­ture.

More milk im­ports like­ly

While lo­cal dairy farm­ers could be among the hard­est hit by Nes­tle’s planned re­struc­tur­ing of its dairy op­er­a­tions, Pro­fes­sor Wayne Gan­pat, agri­cul­tur­al ex­pert and for­mer Dean of the Fac­ul­ty of Food and Agri­cul­ture at the Uni­ver­si­ty of the West In­dies (UWI), be­lieves the wider mar­ket is like­ly to ad­just, with op­por­tu­ni­ties emerg­ing for im­porters and lo­cal dairy proces­sors to fill any gaps left be­hind.

Gan­pat said con­sumers are un­like­ly to face short­ages, even if Nes­tle ex­its the fresh milk pur­chas­ing, busi­ness be­cause im­port­ed milk prod­ucts are al­ready a sig­nif­i­cant fea­ture on su­per­mar­ket shelves.

“If they ex­it the sec­tor, farm­ers will suf­fer, but the mar­ket will not suf­fer be­cause peo­ple will just im­port pack­aged milk from oth­er coun­tries,” he said.

He added that the move could al­so cre­ate room for lo­cal com­pa­nies al­ready in­volved in milk and dairy prod­ucts to ex­pand their op­er­a­tions.

“That leaves op­por­tu­ni­ty wide open for the im­por­ta­tion of milk. It al­so cre­ates op­por­tu­ni­ties for oth­er peo­ple to scale up their en­ter­pris­es, for in­stance Ram­saran and oth­er peo­ple who deal with milk and milk prod­ucts,” Gan­pat said.

Gan­pat ar­gued that the cur­rent un­cer­tain­ty can­not be sep­a­rat­ed from the long­stand­ing de­bate over milk pric­ing among farm­ers, Nes­tle and the Gov­ern­ment.

“There has al­ways been a con­sis­tent is­sue be­tween farm­ers and Nes­tle and gov­ern­ment about the pric­ing. They nev­er seem to get it right,” he said.

De­spite the con­cerns, Gan­pat re­mains op­ti­mistic that an agree­ment can be reached be­fore dairy farm­ers are sig­nif­i­cant­ly af­fect­ed.

“There is some lead time they seem to be giv­en. I feel there will be a ne­go­ti­at­ed set­tle­ment with that is­sue,” he said.

Be­yond fresh milk

The sit­u­a­tion has al­so prompt­ed calls for a broad­er re­think of the dairy in­dus­try’s role with­in the econ­o­my.

Agri­cul­tur­al con­sul­tant Riyadh Mo­hammed said the sec­tor’s fu­ture should not de­pend sole­ly on the sale of fresh milk but on the de­vel­op­ment of a wider val­ue chain ca­pa­ble of gen­er­at­ing greater eco­nom­ic re­turns.

Ac­cord­ing to Mo­hammed, repo­si­tion­ing milk as a high-val­ue in­dus­tri­al in­put rather than a com­mod­i­ty is crit­i­cal to the sec­tor’s long-term growth.

He not­ed that lo­cal­ly pro­duced milk can sup­port the pro­duc­tion of yo­gurt, flavoured milk, cheese, cul­tured dairy prod­ucts, ice cream and nu­tri­tion­al bev­er­ages. Such prod­ucts could serve do­mes­tic de­mand from su­per­mar­kets, schools and the hos­pi­tal­i­ty sec­tor while al­so cre­at­ing op­por­tu­ni­ties for ex­ports.

Mo­hammed said ex­pand­ing val­ue-added dairy pro­duc­tion would stim­u­late growth in pack­ag­ing, brand­ing, cold-chain lo­gis­tics and prod­uct in­no­va­tion, trans­form­ing dairy farm­ing in­to a plat­form for man­u­fac­tur­ing and wealth cre­ation.

Mo­hammed al­so be­lieves the in­dus­try’s cur­rent chal­lenges should serve as a cat­a­lyst for re­form.

He called for a co­or­di­nat­ed na­tion­al strat­e­gy fo­cussed on pro­duc­tion tar­gets, im­port sub­sti­tu­tion, trans­par­ent pric­ing sys­tems and stronger con­trac­tu­al arrange­ments be­tween farm­ers and proces­sors.

In­vest­ment, he said, is need­ed in herd ge­net­ics, for­age de­vel­op­ment, cool­ing in­fra­struc­ture, lab­o­ra­to­ry test­ing sys­tems and en­er­gy-ef­fi­cient tech­nolo­gies. Stronger farmer co­op­er­a­tives could al­so help im­prove bar­gain­ing pow­er, re­duce costs and en­sure more re­li­able sup­ply.

Look­ing fur­ther ahead, Mo­hammed said T&T has the po­ten­tial to de­vel­op a com­pet­i­tive dairy ex­port in­dus­try serv­ing Cari­com mar­kets by im­prov­ing pro­duc­tiv­i­ty, in­creas­ing pro­cess­ing ca­pac­i­ty and strength­en­ing prod­uct brand­ing.

Rather than view­ing Nes­tle’s re­view sole­ly as a threat, he ar­gued it should be seen as an op­por­tu­ni­ty to mod­ernise the sec­tor and build a more re­silient dairy in­dus­try.