In Ukraine is rapidly rising prices for milk: the experts gave their forecast

Ukrainian farmers do not get tired to rewrite the price tags. While stopped, only the price of milk varieties extra level of 9.41 UAH/l, a 21 a penny more than at the end of December. At the same time, prices for milk of the highest and first grade last week rose 9 cents to 8.83 UAH/l and 8.50 UAH/liter, respectively, writes UBR.

For comparison, in late December, a liter of milk of the highest grade cost 8,63 UAH, and first grade — 8,23 UAH/liter.

As the analyst of the Association of milk producers Yana Muzychenko, in the near future, the procurement price of milk a little stabiliziruemost, although cheap dairy products in retail yet not to look.

Experts explain that milk and dairy products rose in price because of the devaluation of the hryvnia, which has led to higher prices for diesel fuel and other cost components. For example, for the month the hryvnia exchange rate dipped to 4.4%, and the cost of diesel fuel increased by 4.6%.

In addition, the continuing decline in yields, including due to the reduction of cattle in Ukraine. The processors have raised prices for dairy products in December. For example, the cheapest milk fat content of 2.5% in plastic packaging from late November until the beginning of the new year rose from 14.87 UAH/l to 16.53 UAH/l or 11.2%.

“The decline in production continues to fuel the “appetite” processors”, – says Yana Muzychenko.

The same significant increase was observed on the most expensive product butter 82% fat. In December it gained 11.3 per cent, breaking the mark 170,2 UAH/kg. Other dairy products (sour cream, yogurt, cottage cheese) to the beginning of the new year rose in price by only 6-7%. So, a litre of yogurt cost 25 UAH, kilogram of cheese — 90 UAH, and cheese “Russian” — 148 UAH/kg.

As the Director of the Ukrainian Association of trade networks suppliers Oleksiy Doroshenko, market prices will always adjust to the market environment of major retail chains. Therefore, market price tag is also steadily creeping up and after the New year. For example, if before the holidays kilo of cheese was in the capital markets to bargain for 50 – 60 UAH, now the sellers are not shy to ask all 70 UAH/kg.

“The decline in production continues to fuel the “appetite” processors”, — says Yana Muzychenko.

Recall, according to the state statistics service, milk production in Ukraine last year fell to 10.4 million tonnes (2.1%). The trend is unchanged — agricultural increase production, and “farm” the milk becomes less. But while the proportion of farms are still small — 26,1% (increased 1%).

Competitive offer of raw materials in the market contributes to the seasonal decline in milk production and improvement of conditions for export of Ukrainian dairy products. We are talking about condensed milk and cream, dry milk and butter.

The yields fall. Photo: “Today”

“54% of export of Ukrainian milk is butter. So it will continue the largest growth of prices. Those sour cream or cottage cheese we export,” — says Alexey Doroshenko.

According to analysts of “INFAGRO” the price of milk in December reached record levels for all of last year. Export-oriented market of Ukraine, warmed-up world dairy prices stops their growth record in the second half of December. Therefore, the near future developments in the commodities market depends on the activity of exporters.

Will be even more expensive

Doroshenko cannot predict how it will increase prices for certain dairy products in the future. “I think that in this case affects some nervousness producers of milk and dairy products regarding the future exchange rate and the General economic situation in the country. It is transmitted and retailers,” says the expert.

According to him, dairy products are at greater risk of rising prices than any other products.

“For the first week of January, retail prices for milk grew by around 0.5%. At first glance, but annually it gets about 20%, which is twice above inflation last year”, — said the expert.

At the same time, the retail network is trying to restrain the appetites of suppliers as not interested in falling sales. “There is no guarantee of sales, the network will not be able to calculate their income,” — said Doroshenko and predicted that though prices will rise, but not as much as before the New year.

Soda instead of yogurt

According to the balance calculations of the Economic discussion club, in 2016 the population’s consumption of milk and dairy products amounted to CAD 209.4 kg/person, which is 0.5 kg less than in 2015 and is only 55% from rational norm. Experts say that further reduce the number of cows in 2017, the Ukrainians will eat dairy products even less.

In the world, according to research company Canadean global markets, there are quite different trends. For example, for 2017, the projected strengthening of the role of a healthy diet.

“Milk” in the Ukraine began to use less. Photo: AFP

According to the survey, 75% of consumers believe that artificial additives are harmful to health. More than 45% said they are interested in food and drinks, which improve digestion. Therefore, buyers began to buy less products with a high sugar content, gluten, artificial sweeteners. But the consumption of foods high in calcium and probiotics, in contrast, is growing.

This trend is already observed in the segment of drinking yoghurts and begins to manifest itself in the categories of milk and cheese. According to the Director of “INFAGRO” Basil Vintonyaka, due to the economic crisis the consumption of dairy products in Ukraine has been falling for three years in a row. Last year was no exception, but the pace of this fall has slowed significantly, and in some products this process is not stopped.

So there are preconditions to expect that in current year the consumption of dairy products gradually begin to recover, even in spite of a substantial rise in price.