Pakistan’s dairy sector, a cornerstone of rural livelihoods and national food security, is facing a severe crisis. The widening input–output imbalance—where rising production costs are not matched by milk prices—is pushing millions of small farmers to the brink of collapse. Pakistan produces around 70 million tons of milk annually, yet 8 million households, contributing 80% of this production, struggle to survive. Feed alone constitutes over 65% of total production costs, while energy for tube wells, chilling, medicines, labour, and transportation adds further burden. On top of this, up to 15% of milk is lost in the supply chain due to poor collection and lack of cold storage, depriving farmers of critical income.

A major factor aggravating this crisis is the capped farm-gate price of milk, which prevents farmers from earning a fair return that reflects rising input costs. While production expenses continue to surge, the officially capped milk price does not adjust accordingly, leaving farmers powerless to cover costs. Middlemen and local traders often exploit this system, further reducing the actual revenue received by producers. Small farmers, who supply the majority of the country’s milk, are most affected, and this crisis is particularly severe in urban centers such as Karachi, where dairy farmers of Landhi Cattle Colony face extreme financial pressure due to high input costs, limited access to formal markets, and exploitation by middlemen.

The consequences of this imbalance are alarming. Many farmers are forced to reduce herd sizes, abandon dairy farming, or sell animals at distress prices. Rural and peri-urban households dependent on dairy income are pushed into poverty, and declining milk production threatens national food security. If left unaddressed, the capped pricing system combined with rising costs could lead to a collapse of Pakistan’s dairy sector, impacting millions of families and the wider economy.

Addressing this imbalance requires urgent, practical, and coordinated solutions. On the input side, farmers can reduce costs through silage and high-quality fodder cultivation, ensuring a stable feed supply throughout the year. Balanced feeding and breed improvement increase milk yield per animal, lowering the per-litre cost of production. Preventive veterinary care reduces disease-related losses and improves herd productivity. Biogas plants provide renewable energy for tube wells, electricity, and heating, while producing organic fertilizer to replace costly chemical inputs. Government support through subsidies and low-interest loans is essential to enable small farmers to adopt these technologies quickly and cost-effectively.

On the output side, the capped milk prices must be reviewed and adjusted based on actual production costs. Implementing a flexible, cost-based farm-gate pricing mechanism will allow farmers to receive fair revenue, maintain profitability, and continue producing milk sustainably. Organizing farmers into cooperatives strengthens their bargaining power, allows collective marketing of milk, and reduces reliance on middlemen. Linking cooperatives directly with formal processors or value chains stabilizes revenue and incentivizes investment in quality improvement. Regional models, such as India’s cooperative dairy systems like Amul, demonstrate that structured pricing and farmer organization can significantly increase incomes for small producers while stabilizing the sector.

The capped milk prices and input–output imbalance are not just economic inefficiencies—they are a direct threat to the survival of Pakistan’s dairy farmers and the millions of families who depend on them. This crisis is being experienced more acutely in Karachi, especially among the dairy farmers of Landhi Cattle Colony, where high costs, limited infrastructure, and market exploitation make survival extremely difficult. Immediate and decisive action is required to ensure that farmers receive fair prices that reflect the true cost of production, and that they have access to cost-saving technologies like biogas and high-quality fodder. Protecting farmers’ incomes is essential to safeguard national food security, prevent the collapse of the dairy sector, and sustain rural and peri-urban livelihoods. The government must act now to empower farmers, strengthen cooperatives, and remove structural barriers that exploit small producers. Failure to do so will not only devastate communities like Landhi Cattle Colony but also threaten the stability of Pakistan’s entire dairy industry. The time to prioritize and defend the rights of our farmers is now—before this vital sector is irreversibly damaged.

Dr Alamdar Hussain Malik
Advisor
Veterinary Sciences, University of Veterinary and Animal Sciences, Swat
Former Secretary / Registrar, Pakistan Veterinary Medical Council