In Ukraine, a high purchase price of milk is formed due to low supply in the market, active export of butter and cheese product

Submitted by bashun on Thu, 10/05/2017 - 10:47

In September, the most discussed topic in dairy circles in Ukraine was the rise in prices for milk. In general, over the past three months, relatively high-quality dairy raw materials has grown in price by 18%. Unfortunately, this growth was not due to the growth of the purchasing power of the domestic consumer.

This is reported by
Sales of most dairy products are now lower than last year's level, not to mention the pre-crisis period. Therefore, processors can not increase the prices of ready-made dairy products in proportion to the rise in price of raw materials. It turns out that the high cost of milk in Ukraine is formed only due to its low supply and activity of export of two commodity items - butter and cheese product.
Expert notes: "Obviously, the situation that has emerged is beneficial mainly for agricultural producers, and a number of efficient enterprises now have a profitability of up to 50% in milk." In general, they have to complain, even if there is no subsidy from the state. "
The other day the government promulgated the draft budget for 2018. It is planned to unprecedented a large amount to support farmers, about 7.3 billion UAH. Of this amount, it is planned to allocate 1 billion UAH to support farmers and cooperation of small producers; 1 billion UAH - for partial compensation acquisition of domestic agricultural machinery and equipment; 2 billion UAH - as a subsidy (cattle breeders, horticulturists, etc.) 2.3 billion UAH - for the development of the livestock sector (construction and reconstruction of farms, cheaper interest rates on loans).
In general, the largest sum is promised to be paid to producers of livestock products. Only for some reason, most of them are dissatisfied with such a decision. Now a direct subsidy (compensation for the abolition of VAT benefits) will be less, and to get money, you need to build something.
It is necessary to further stimulate those who want to develop direction, and not just increase profits at the expense of the state. It is true that agricultural producers having bitter experience of the past just do not believe that compensation for construction will be paid. Here, officials should offer some new, more transparent mechanism for the distribution of money.
Distributing the "carrot" to the dairy market operators, the government also intends to use the "stick", although this applies more to processors. In particular, there are plans to lift the moratorium on the verification of producers of dairy products by the State Service of Ukraine for Food Safety and Consumer Protection. This is the right decision.
Now there is a lot of falsification on the market, which does not allow to work effectively with respectable producers of dairy products. We should also allow inspections and fiscal services, because the topic of selling gray, nowhere listed products - respectively, without paying taxes - in Ukraine has become very relevant.

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