Ukraine Grapples with Soaring Prices Amidst Raw Milk Shortage
Source: The DairyNews
The persistent decline in raw milk production in Ukraine has propelled prices to unprecedented levels, causing significant concern among market players.
The Ukrainian Union of Dairy Enterprises estimates that during the latter half of 2023, raw milk prices in Ukraine surged by 36%, surpassing those in some European counterparts.
Leonid Tulush, head of the analytical department at the Ukrainian Union of Dairy Enterprises, expressed his astonishment, stating, "I can't recall such a sharp growth in raw milk prices in previous years," in an interview with the local publication Telegraph.
In July 2023, the average farmgate price of raw milk was €33 per 100 kg, which soared to €42 per 100 kg by November.
The farmgate prices in Ukraine, which were initially at 60% of the European average at the beginning of the year, gradually rose to 95% by November-December, aligning with those of other European countries.
Georgy Kuhaileshvili, an analyst with the Ukrainian association of milk manufacturers, highlighted the impact on competitiveness, stating that Ukrainian dairy products are losing appeal to European customers due to the elevated prices.
The shortage of raw milk in Ukraine has reached alarming levels, with prices surging to €50 per 100 kg in recent weeks. Dairy processors are grappling with what they describe as 'insanity,' as the high prices push them to the brink of zero profitability.
Leonid Tulush emphasized the need for governmental intervention, suggesting that authorities encourage milk farmers to increase production. Subsidies for capital costs, such as building new farms, could potentially stabilize the dairy sector and alleviate the intense competition among processors.
Vadim Chagarovsky, head of the Union of Dairy Enterprises of Ukraine, noted that the profitability of milk farms, historically low in Ukraine, is now reaching unprecedented levels, ranging from 30% to 60%. The situation is deemed a significant challenge for the dairy industry, prompting calls for timely government action.
Leonid Tulush, head of the analytical department at the Ukrainian Union of Dairy Enterprises, expressed his astonishment, stating, "I can't recall such a sharp growth in raw milk prices in previous years," in an interview with the local publication Telegraph.
In July 2023, the average farmgate price of raw milk was €33 per 100 kg, which soared to €42 per 100 kg by November.
The farmgate prices in Ukraine, which were initially at 60% of the European average at the beginning of the year, gradually rose to 95% by November-December, aligning with those of other European countries.
Georgy Kuhaileshvili, an analyst with the Ukrainian association of milk manufacturers, highlighted the impact on competitiveness, stating that Ukrainian dairy products are losing appeal to European customers due to the elevated prices.
The shortage of raw milk in Ukraine has reached alarming levels, with prices surging to €50 per 100 kg in recent weeks. Dairy processors are grappling with what they describe as 'insanity,' as the high prices push them to the brink of zero profitability.
Leonid Tulush emphasized the need for governmental intervention, suggesting that authorities encourage milk farmers to increase production. Subsidies for capital costs, such as building new farms, could potentially stabilize the dairy sector and alleviate the intense competition among processors.
Vadim Chagarovsky, head of the Union of Dairy Enterprises of Ukraine, noted that the profitability of milk farms, historically low in Ukraine, is now reaching unprecedented levels, ranging from 30% to 60%. The situation is deemed a significant challenge for the dairy industry, prompting calls for timely government action.
