Ukraine has seen a significant increase in the Ukrainian Dairy Index (UDI) in 2018. In September, UDI grew by a decent 7.1%. This was reported by the economist of the FAO Investment Center Andrii Yarmak, agropolit.com reported.
Due to the beginning of the active season of processing sunflower and soybeans, the supply of meals of these crops increased in the market, and their prices fell quite significantly.
“And what about the price of milk? The average growth over the month was just 1.8%, which is very small, as for September. However, I would say that this is an excellent indicator, considering how bad things are with the prices of dairy products in the world. Protein does not increase in price, and fat continues to fall in price,” is said in the report.
Everything was positive at the market in the same month a year ago. Due to the rapid growth of world prices in September 2017, our UDI grew immediately by 12.7%.
So, since our UDI was falling seven months out of nine, and in September it grew less than usual, in September 2018 UDI was already 23.6% lower than in the corresponding month of 2017. So, this difference continued to worsen with the previous year, - added Andrii Yarmak.
UDI was lower only twice in September - in the crisis years for the dairy industry in 2015 and 2016. In other years, in September the value of UDI was significantly higher. So, this was the third worst September for professional milkmen in terms of milk production profitability historically.
It was the same with milk yield for the period January-August. It was only worse in 2015 and 2016. During these eight months of 2018, professional milk producers received an average of 14.4% less profit than in the same period of 2017 and 7.7% less than the average for the same period of 2012-2017.
What to expect in October? As a rule, in October we see a slowdown in the growth of UDI. Last year, when everything was good on world markets, UDI in October grew by only 2.5%. But the positive thing is that the UDI never dropped in October, which, of course, does not mean that this will not happen in 2018. And let's hope for the best. In any case, increasing production efficiency is the only way to success in the dairy business, Yarmak says.