Ukraine: latest update of the dairy market
Based on data from the profile analytical presentation "Agricultural Portfolio 2021", prepared by the Ukrainian Association of Business and Trade (UBTA) with support from the Ministry of Agriculture and the Ministry of Economy, the information agency Kurkul.com evaluated the results of Ukrainian dairy market in 2020 and described the expectations from 2021.
We would like to share them with you.
Ukraine's international trade in dairy products
In 2021, 8 new international markets were opened for the Ukrainian exporters and 63 commodity positions in 11 countries and international economic organizations were renegotiated. In particular, the markets of Japan, Libya, Argentina and Lebanon were opened for the dairy products from Ukraine.
According to UBTA, milk and dairy products account for 0.8% of Ukrainian agricultural exports. 145 dairy exporters sell Ukrainian dairy products on the international markets.
The last record exports of milk and dairy products was listed in 2011 - $ 593 million, with imports of $ 133 million. In 2014-2019 gradual decrease in revenues from exports of dairy products from $ 324 million to $ 224 million. In 2016, the anti-record of exports of dairy products $ 158 million with imports of $ 42 million. In 2020, exports of milk and dairy products amounted $ 172 million, and imports exceeded this by almost 73% and amounted $ 297 million (negative balance of $ 125 million).
In 2020, Ukraine supplied dairy products to 107 markets. Main importers are Europe (41.8%), the countries of the Eurasian Economic Union (EAEU) (17.4%), the countries of Asia (14.8%) and the Middle East (10.9%).
Dominating commodities in the structure of dairy exports are butter, milk and cream (dry or condensed), and cheese. Whey, non-concentrated milk and cream take a minor share in the export sales.
Local Production.
Milk
In 2020, Ukraine lost 4.2% of gross milk production. Thus, farms of all categories produced 9.25 million tons of milk.
Industrial farms provided 29.7% of total milk or 2.75 million tons (+ 0.8% compared to last year). The industrial farms last year showed slight increase in production. But most farms suffered significant losses due to difficult climatic conditions in 2020.
Despite the fact that milk production in households decreased by 6.2% last year (504.3 thousand tons), they supplied70% of the total milk volume.
In the first eight months of 2021, Ukraine produced 6.35 million tons of milk of all kinds, which is 6.2% less than in the same period last year. This is due to the rapid decline in households and insufficient supply from the industrial sector. Industrial enterprises provided 30.6% of total milk production or 1.85 million tons, which is 1.4% lower than last year.
Despite the increase in capacity of individual dairy complexes, regions - traditional leaders in the industrial milk production showed reduction in production: Poltava oblast (263.8 thousand tons; -1.9%), Cherkasy (193.5 thousand tons; -6.4%) and Kharkiv oblast (167 thousand tons; + 0.5%).
Instead, increase in milk production is observed in Ternopil oblast (78.3 thousand tons; + 13.6%),
Milk production in households decreased by 8% compared to 2020. In January-August, this sector produced 4.19 million tons of milk. The milk yields of Kharkiv (136.3 thousand tons; -19.7%), Chernihiv (134.2 thousand tons; -14%) and Cherkasy (93.9 thousand tons; -13.5%) oblasts decreased the most.
Dairy products
In 8 months of 2020, Ukraine produced 1.33 million tons of dairy products, which is 3% less (-45 thousand tons) than last year. 271.2 thousand tons (-84 thousand tons) of fresh sour milk products were produced. Kherson (33.2 thousand tons; + 7.8%) and Vinnytsia (150.4 thousand tons; +5, 5%) oblasts showed increase.
The reduction in cheese production was only 0.3%, and the total volume of manufactured products is 123.7 thousand tons. There was an increase in the production of fresh unfermented and sour milk cheese by 7.4% to 51.6 thousand tons and processed cheese - by 6 .8% to 19.6 thousand tons. However, in the segment of hard cheeses there was a decrease in production, which amounted to almost 9% - up to 52.5 thousand tons. This situation can be explained by reduced demand at the domestic market due to competitive import supply from the EU.
Last year, sour milk products were exported in the amount of $ 14 million or + 54.8% compared to 2019, cheeses - in the amount of $ 210.5 million or + 93.3%.
Instead, exports by main dairy groups decreased by 9-40%:
- whole milk and cream - by 21.3% to $ 12 million;
- condensed milk - by 27.5% to $ 55.7 million;
- butter - by 36.5% to $ 49 million.
The increase in exports was observed only in whey - + 21.5% to $ 22.3 million. Due to attractive prices on the world market, exports of casein in monetary terms last year increased by 161.8% - to $ 38 million.
In 2021 there is a reduction in the export of dairy products. Thus, in August this year, compared to the same month in 2020, exports of skimmed milk powder decreased by 2 times - to 725 tons, butter and whey - by almost a quarter - to 600 tons and 1.4 thousand tons, respectively.
Increase of cattle population.
As of September 1, there were 1.655 million cows in Ukraine, which is 5.9% less than last year. Of these, 425.2 thousand cows are kept in the industrial sector, and 1.230 million heads - in households.
The upward trend of headcount at the industrial farms was been maintained for several months in a row - the number of cattle increased by 500 heads. The largest increase is observed in Kherson (+ 14%; total headcount is 6.5 thousand), Ternopil (+ 7.9%; 13.6 thousand), Ivano-Frankivsk (+ 7.5%; 4.3 thousand), Kyiv (+ 6.8%; 33.2 thousand) and Volyn (+ 5.1%; 18.7 thousand heads) regions.
In 2020 and 2021, the farms put into operation modernized dairy complexes or their parts, some of which should be completed by the end of the year. New European-style dairy farms are planned to open in 2022. Therefore, according to analysts, under such conditions, the dairy industry will gain momentum.
However, in the farms of the homestead sector there is a decrease in livestock by 7.9% - up to 1.23 million. The largest decrease was observed in the Kherson region - 16.2% to 37.9 thousand heads.
The original article was prepared by © Anastasia Gerasimenko, Kurkul.com, 2021
The Original article with inforgraphics is available in Ukrainian.