Dairy market in Poland
Did you know that Poland ranks third (after Germany and France) among milk producers in the European Union? In this article you can read more about the dairy market in Poland, its position on this market and the export of its dairy products.
European dairy market
The European Union, as one of the world's leading producers and exporters of milk and dairy products, is expected to see continued growth in milk production. According to the European Commission's forecast, EU milk production in 2024 is likely to reach 154.3 million tons, a 0.4% increase compared to 2023.
Poland ranks third (after Germany and France) among milk producers in the European Union. Since Poland joined the EU in 2004, milk procurement in the country has increased by around 60% by the end of 2023. This growth has been accompanied by an increase in milk yield per cow, reaching 7,000 liters in 2023.
Since the beginning of 2024, the supply of raw milk for procurement on the domestic market has remained higher than the previous year. In total, in the period from January to May 2024, raw milk procurement in the country amounted to over 5.6 billion liters, which is 5% more than in the same period a year earlier. On a monthly basis, a slight increase in milk deliveries was recorded in May. According to GUS data, in May 2024, domestic producers delivered approximately 1.19 billion liters of raw milk to purchasing entities, which is 5% more than in April 2024 and 5% more than a year earlier.
Polish position on the dairy market
In Poland, the production of raw cow's milk exceeds domestic market demand, creating the opportunity to sell surpluses on foreign markets. Poland is the 5th largest exporter of milk in the European Union, after Germany, the Czech Republic, France, and Belgium. In recent years, on average, 32% of Poland's domestic milk production has been exported.
However, in the first four months of 2024, the revenues of the domestic dairy industry from the export of dairy products were lower than in the same period a year earlier. According to preliminary data from the Ministry of Finance, in the period from January to April 2024, the value of exports of dairy products from Poland amounted to 1.15 billion euros (5 billion zlotys) and was 3.4% lower than in the period from January to April 2023. The decrease in the value of exports was caused by the appreciation of the zloty against the EU currency, which was recorded in the first quarter of 2024, as well as the lowest levels of the US dollar since the end of 2021. At the same time, 567 million euros (2.46 billion zlotys) were spent on imports of dairy products, which is over 1% more year-on-year.
The positive balance of trade in dairy products in the first four months of 2024 amounted to 586 million euros (2.54 billion zlotys), which is 8% lower than in the comparable period of 2023.
Export
Sales of dairy products to EU countries generated 68% of the revenue obtained from the export of these products overall (782 million euros, a decrease of 2% year-on-year). The main recipients of dairy products on the EU market were:
- Germany (19% of the value - 220 million euros),
- Czech Republic (7% - 84 million euros),
- Romania (5% - 62 million euros), and
- the Netherlands (5% - 53 million euros).
The share of non-EU countries in the export of dairy products from Poland was 32%. Revenues from exports amounted to 372 million euros and were 6% lower than in the period from January to April 2023. The largest share in Polish exports among non-EU countries was held by:
- Algeria (6% - 74 million euros),
- Great Britain (5% - 61 million euros),
- Ukraine (3% - 31 million euros), and
- Saudi Arabia (2% - 24 million euros).
Exported products
The highest revenues in the first four months of 2024 among dairy products were obtained from the export of cheeses and curd (378 million euros), liquid milk and cream (203 million euros), skimmed milk and concentrated milk (147 million euros), ice cream (145 million euros), and butter and milk fats (136 million euros).
On the domestic market, in the first eight months of 2023, there was a downward trend in milk procurement prices, which reflected the downturn in the global market. In Poland, an additional factor supporting the decline in raw material prices was the increase in milk supplies to the industry.
In the following months of 2023, i.e., in the period from September to December 2023, a seasonal upward trend in milk procurement prices was observed, caused, among other things, by a revival of demand for some dairy products.
The upward trend in milk procurement prices stopped at the beginning of 2024. In the first five months of this year, a downward trend in milk procurement prices persisted. The price decreases were caused, among other things, by large milk supplies for procurement and the process of deflation in the country.
Source: KOWR