Ukraine's Dairy Industry Overview

The Ukrainian dairy sector forms a vital part of the country's agricultural framework, playing a crucial role in both local consumption and international trade. In 2023, Ukraine produced approximately 8.1 million tons of milk, marking its significant contribution to the global dairy market.

Milk Production and Processing

In 2023, Ukraine processed about 4.5 million tons of milk into various dairy products, including cheese, milk powder, and whey. Cheese production reached roughly 200,000 tons, while both milk powder and whey accounted for 150,000 tons each. This level of processing underscores the country's advanced dairy infrastructure.

Dairy Cattle and Goats

The dairy cattle population was estimated at around 1.5 million in 2023, with the total cattle population, including beef cattle, projected to reach approximately 2.294 million by the end of 2024. The goat milk sector remains relatively underdeveloped in Ukraine.

Key Enterprises in the Dairy Market

Prominent dairy processing companies include Terra Food, Lactalis Ukraine, Milk Alliance, Yagotynsky Butter Plant, and Kherson Dairy Plant. Notable dairy farms comprise Astarta Holding, Mriya Agro Holding, Nibulon Agro, Kernel Holding, and Ukrlandfarming.

Export and Import of Dairy Products

In 2023, Ukraine exported around 500,000 tons of dairy products, focusing on markets in the EU, China, and the Middle East. Key exports were cheese, milk powder, and whey, generating export revenue of $296.8 million, a 16% increase from the previous year. Imports totaled about 80,000 tons, mainly cheese and butter from the EU and neighboring regions.

Significant Events Influencing the Dairy Industry

Recent years have seen significant developments in the Ukrainian dairy industry. By June 2024, raw milk prices rose to 35.51 euro cents per kg due to increased procurement costs. Demand surged in the EU and China, with geopolitical tensions impacting supply chains and boosting exports. Despite challenges from Russian drone attacks, Ukraine continues negotiations with the EU to amend tariff quotas. Cheese exports increased by 40.3% in the first ten months of 2024 compared to 2023. From January to August 2025, dairy exports grew by 13% in physical terms and 49% in monetary terms.

New Developments

Ukrainian dairy companies are investing in new hard cheese production facilities. Agroprodservice and Molokiya are collaborating to establish a hard cheese production plant. By 2025, 125 new dairy farms are expected to be built. The sector is exploring the resumption of full-scale dry milk exports to Japan. However, the industry faces challenges such as weakening domestic demand, falling commodity prices, and increased cheese imports. Ukraine is dealing with an oversupply of butter, affecting raw milk purchase prices and pushing dairy farms to operate at cost. Retail prices surged due to escalating production costs. The dairy market is entering a phase of price decline amidst a growing surplus of raw milk.

Ukraine is partnering with Saudi Arabia in a $1 billion investment to boost agriculture and dairy production. The country is discussing a national "School Milk" program, potentially covering more than 4.4 million schoolchildren by 2026. The gap between raw milk prices and retail dairy product costs is widening, with farmers incurring losses due to declining purchase prices. Ukraine's dairy industry faces financial challenges due to export revenue decline and structural imbalances, with a shift from small-scale to industrial models. Ukraine's dairy farming is entering a phase of escalating crisis, with the market potentially facing a mass reduction in livestock and farm closures in the coming months due to rising costs of production and geopolitical pressures.

Modified: 2026/04/19