Analyst tells what will happen to milk prices in Ukraine
Kyiv • UNN
Surpluses of raw milk contribute to price stabilization in Ukraine. Butter prices are likely to decline further as stocks of the product accumulate in warehouses.
In Ukraine, raw milk prices are stabilizing as a result of a reduction in exports of exchange-traded goods during the period of calm in the global milk market during the Christmas and New Year celebrations. This was reported by analyst of the Association of Milk Producers Giorgi Kukhaleishvili, UNN reports.
Kukhaleishvili noted that the emergence of a surplus of raw milk on the domestic market and reduced demand from dairy processing companies will likely contribute to lower purchase prices in the short term.
The Association reports that the average purchase price of extra milk as of December 25 was 19.60 UAH/kg excluding VAT, which is 20.00 kopecks more than a month ago. The range of prices for this grade in farms varies from 18.50 to 20.50 UAH/kg excluding VAT. The lower boundary of the price range increased by 20 kopecks, while the upper boundary has not changed over the past month. Compared to December 1, the price of extra-grade wheat decreased by 10 kopecks.
The highest grade costs on average 18.65 UAH/kg excluding VAT. The price has not changed compared to the results of the November 25 monitoring. Prices for premium milk range from 17.80 to 19.50 UAH/kg excluding VAT. Compared to the results of the monitoring in the second half of November, the lower limit of the price range increased by 40 kopecks, and the upper limit decreased by UAH 1.00. The average price for first-class milk amounted to 17.65 UAH/kg excluding VAT and remained unchanged compared to the second half of November. The minimum price on farms amounted to 16.50 UAH/kg and increased by 50 kopecks over the last month. The maximum price amounted to 18.50 UAH/kg and fell by 50 kopecks.
Accordingly, the weighted average price of the three grades amounted to 18.63 UAH/kg excluding VAT, up 7 kopecks from a month ago.
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Purchase prices stabilized in the second half of December due to lower demand for raw milk in Ukraine from dairy processing companies. There is a surplus of raw milk on the domestic market, which is holding back price growth. This may be due to a decrease in dairy exports during the Christmas season, when activity in the dairy market traditionally declines
Kukhaleishvili also noted that the decline in butter prices in the United States, New Zealand, and a number of European countries is likely to hamper the export activity of Ukrainian companies and restrain the growth of raw milk prices in the country. In 2024, butter prices were the main driver of raw milk prices.
According to him, a further decline in butter prices is likely, as stocks of the product are accumulating in warehouses. The decision of Poland to bring 1 thousand tons of butter from its own strategic reserves to the market to help stabilize prices for the product had a certain impact on the decline in butter prices.
