Dairy plants are increasing production and boosting exports

Ukrainian milk processing enterprises are actively increasing the production of fresh dairy products, even despite the need to sell them at significant discounts.

According to market participants cited by «INFAGRO», this strategy allows plants to maintain their raw material zones and reduce the volume of production of loss-making commodity products. The largest discounts currently apply to fatty items — sour cream and cream. Despite the seasonal increase in demand for these products, producers are consciously reducing the volume of fat that was previously directed towards butter production, as its manufacturing remains economically unfavorable.

Processors do not plan to revise the base prices for key whole milk products and certainly will not raise them at least until the end of the year.

Amid increased competition in the domestic market, leading players have intensified the export of fresh products: in October, the volume of foreign supplies grew by one third compared to the corresponding period last year.

Moldova remains the main destination, accounting for 77% of exports, but alternative sales channels are also growing — supplies to the Balkans have been resumed, fermented milk cheeses are being exported more actively to the UAE, and the geography of sales of glazed cheese bars is expanding.

Import of fresh dairy products decreased in October compared to September, but remained higher than last year’s figure. Polish companies remain the main suppliers. Given the surplus of raw materials, import volumes from Poland are expected to increase again at the end of the year.