Ukraine: Milk Becomes Scarcer, and Procurement Prices Are Rising
Source: The DairyNews
At the beginning of July, raw milk prices in Ukraine were revised upwards due to a certain shortage of raw milk in the domestic market and increased demand from dairy processing enterprises. In the future, if milk production continues to decline, another upward revision of prices is possible, reports Georgiy Kukhaleyshvili, an analyst at the Ukrainian Association of Milk Producers.
As of July 1, the average procurement price for extra grade milk was 13.84 UAH/kg excluding VAT, which is 15 kopecks higher than a month ago. The price range for this grade in farms varies fr om 13.20 to 14.30 UAH/kg excluding VAT. The upper lim it of the price range increased by 20 kopecks, while the lower limit did not change over the past month.
The average price for higher grade milk is 13.84 UAH/kg excluding VAT (+15 kopecks). Prices for higher grade milk range fr om 13.20 to 14.30 UAH/kg excluding VAT. Compared to the monitoring results of the first half of June, the lower lim it of the price range did not change, and the upper limit increased by 20 kopecks.
The average price for first grade milk was 13.04 UAH/kg excluding VAT, which is 9 kopecks higher than a month ago. The minimum price in farms was 12.65 UAH/kg and did not change over the past month. The maximum price was 13.35 UAH/kg and increased by 15 kopecks.
Accordingly, the weighted average price of the three grades was 13.57 UAH/kg excluding VAT, which is 13 kopecks higher than a month ago.
Georgiy Kukhaleyshvili notes that since the end of June, the demand for raw milk in Ukraine has begun to exceed the existing supply. Dairy processing enterprises have begun to face a certain shortage of raw milk. This led to a targeted increase in raw milk prices at the beginning of July. The increase in fuel prices has not yet affected the changes in milk prices at the factory. However, the shortage of raw milk has increased the average price by 55 kopecks on the spot market compared to June. In the future, procurement prices may continue to rise if the supply of raw milk in the domestic market continues to decline.
In July, hot weather is forecasted in Ukraine, which usually affects the reduction of productivity in cows in the household sector. The intensification of Russian missile strikes on Ukraine's energy infrastructure poses a challenge for dairy farms that depend on electricity and use automated milking equipment for large-scale milk production. According to preliminary estimates by the Ukrainian Association of Milk Producers, a 2% reduction in raw milk production is expected in Ukraine in 2024.
Despite the rise in raw milk prices, cheese, cheese products, whey, and butter production in Ukraine remains profitable. The depreciation of the hryvnia and the strengthening of dairy product prices in recent weeks have improved the profitability of commodity production. Despite the weakening global demand for dairy products during the holiday season, as evidenced by the decline in the price index from the recent 359th GDT auction, butter and anhydrous milk fat prices remain high. Global milk prices are being driven by the reduction in raw milk production in key exporter regions of commodity products.
Source
The average price for higher grade milk is 13.84 UAH/kg excluding VAT (+15 kopecks). Prices for higher grade milk range fr om 13.20 to 14.30 UAH/kg excluding VAT. Compared to the monitoring results of the first half of June, the lower lim it of the price range did not change, and the upper limit increased by 20 kopecks.
The average price for first grade milk was 13.04 UAH/kg excluding VAT, which is 9 kopecks higher than a month ago. The minimum price in farms was 12.65 UAH/kg and did not change over the past month. The maximum price was 13.35 UAH/kg and increased by 15 kopecks.
Accordingly, the weighted average price of the three grades was 13.57 UAH/kg excluding VAT, which is 13 kopecks higher than a month ago.
Georgiy Kukhaleyshvili notes that since the end of June, the demand for raw milk in Ukraine has begun to exceed the existing supply. Dairy processing enterprises have begun to face a certain shortage of raw milk. This led to a targeted increase in raw milk prices at the beginning of July. The increase in fuel prices has not yet affected the changes in milk prices at the factory. However, the shortage of raw milk has increased the average price by 55 kopecks on the spot market compared to June. In the future, procurement prices may continue to rise if the supply of raw milk in the domestic market continues to decline.
In July, hot weather is forecasted in Ukraine, which usually affects the reduction of productivity in cows in the household sector. The intensification of Russian missile strikes on Ukraine's energy infrastructure poses a challenge for dairy farms that depend on electricity and use automated milking equipment for large-scale milk production. According to preliminary estimates by the Ukrainian Association of Milk Producers, a 2% reduction in raw milk production is expected in Ukraine in 2024.
Despite the rise in raw milk prices, cheese, cheese products, whey, and butter production in Ukraine remains profitable. The depreciation of the hryvnia and the strengthening of dairy product prices in recent weeks have improved the profitability of commodity production. Despite the weakening global demand for dairy products during the holiday season, as evidenced by the decline in the price index from the recent 359th GDT auction, butter and anhydrous milk fat prices remain high. Global milk prices are being driven by the reduction in raw milk production in key exporter regions of commodity products.
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23.09.2024
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