The war has caused numerous new problems for the Ukrainian dairy industry, while some long-standing problems remain unresolved. This became clear at the current annual DAIRY BUSINESS conference of the Ukrainian Dairy Association.
The milk producers supplying the industry were able to increase their milk output this year. Preliminary forecasts indicate that they will be able to milk almost as much this year as in the pre-war year of 2021: 2.8 million tons or 8% more than in 2022. Industrial dairy farms will have to produce more milk in the future to compensate for the significant decline in milk production on subsistence farms to balance.
The year 2023 seems to be even more challenging for dairy companies than in the previous year 2022. The dairy industry is generating less profit. Nevertheless, all milk is processed. A rough estimate suggests that dairy companies will be able to increase the amount of milk processed by 7% to 2.9 million tonnes this year.
Sales of industrially produced dairy products are expected to increase by 13% in 2023, and total consumption of dairy products could increase by 5% to 6.4 million tons.
Despite the difficulties caused by the war, Ukrainian milk producers were still able to achieve significant export profits last year. This was made possible by a generally favorable market environment with prices at all-time highs. The majority of Ukrainian exporters of dairy products are now on the verge of breaking even because the prices of some items have fallen by half in the last year.
The association considers the potential of the milk business in post-war Ukraine to be high. Major Western investors are expected to support the country’s dairy sector “after victory” and the country’s accession to the EU and eventually NATO.
At the occasion of the conference, a booklet was published containing up-to-date info on the Ukraine dairy. Download