In a historic first, milk powder to be EXPORTED to China in March 2024

Pelwatte Dairy Industries has invested Rs. 2.6 billion towards building Sri Lanka’s first export oriented (80%) milk powder processing plant in Kurunegala.

Chairman Pelwatte Dairy Industries Ariyaseela Wickramanayake said they already have 3 milk processing plants in Buttala making Pelwatte branded products and the third factory would come up in Kilinochchi in 2025 and they hope to invest a further RS. 2.5 billion for this.

The construction will start late November and the first historic milk powder export, under the brand name ‘made in Sri Lanka’, would be bound for China in March 2024 said Chairman Wickramanayake.

He said that this project should have been implemented two years ago but it took nearly four years for them to get the current 15-acre land on a 36-year lease from the government due to red tape.

“Now I am waiting for BOI approval which I will get next month and construction will begin in November. The equipment would be imported from Europe, India and China and orders for them have already been placed.”

He said over 60% of the investment has been made by reinvesting their profit and the balance is from local borrowing.

Wickramanayake said today local milk production has increased and due to this the Milk Powder imports have reduced and the annual import bill has almost been made zero. Due to this Sri Lanka is now saving around USD 400 million annually spent on milk powder imports.“

Due to many local players engaging in the Dairy industry today the dairy producer is a very ‘rich man’ as he has a readymade market for liquid milk and a good price too. We also opened a milk correcting center in Anuradhapura recently to buy more than 80,000 liters of liquid milk.

“As we have an excess situation in Sri Lanka we hope to start Milk powder exports to China through our new factory in Kurunegala which is the largest buyer of powdered milk in the world.

Sri Lanka is also going in for a Free Trade Agreement with China and this will also assist me towards having better export traffic to China. “We plan to get around USD 100 to 150 million historic milk import revenue from China in the first year.”

He said that through their Buttala plant they already export yogurt and butter and now they are looking at extending their exports to Japan. “We are also looking at exporting Gee to the gulf.”

He said that Pelwatte was also the first company in Sri Lanka to introduce ‘portion butter’ to five star hotels in Sri Lanka.

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