milk-prices-in-ukraine-are-stable-despite-falling-demand-and-global-prices

Milk prices in Ukraine are stable despite falling demand and global prices

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Procurement prices for raw milk in Ukraine remain stable, despite falling demand and lower prices for exchange-traded dairy products in Europe and the USA, according to analysts from the Association of Milk Producers, UNN reports.

Details

According to the Association of Milk Producers, as of September 20, the average price of extra-grade milk was UAH 17.45/kg without VAT, which is 10 kopecks more than in the previous month. The price range on farms varies from UAH 17.00 to UAH 18.20/kg without VAT, with the lower limit increasing by 10 kopecks and the upper limit by 40 kopecks.

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Higher-grade milk is purchased at an average of UAH 17.15/kg without VAT (+10 kopecks), with a range of UAH 16.80–17.60/kg. First-grade milk costs an average of UAH 16.80/kg without VAT, which is 40 kopecks more than at the end of August. The minimum and maximum prices were UAH 16.50 and UAH 17.20/kg, respectively.

Heorhiy Kukhaleishvili, an analyst at the Association of Milk Producers, notes that raw milk prices remain stable due to reduced demand for finished dairy products and raw milk from processors. Enterprises are working for warehouses, limiting exports to the EU and post-Soviet countries, and also facing declining sales in retail chains and falling global exchange prices.

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Prices for butter and dry milk in Europe are falling, American butter costs about 3.5 euros per kg, which is almost half the price of the European product. New trade agreements between the US and the EU allow Europeans to purchase up to 20 thousand tons of American dairy products duty-free annually, which creates additional pressure on local producers. For Ukrainian enterprises with outdated material and technical bases, competition with American producers is particularly difficult.

The increase in raw milk production in both Ukraine and Europe further restrains procurement prices. However, in winter, a certain decrease in milk yield and an increase in domestic demand for fresh dairy products are possible, which could potentially stabilize or slightly increase prices. However, due to low demand and falling exchange prices, a rapid increase in procurement prices is not expected.

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