Poland: market of milk and dairy products
The European Union is one of the world's most important producers and exporters of milk and dairy products. Among the countries of the European Union, Poland, after Germany and France, ranks third in terms of the size of the dairy cow population.
Milk production in the EU
According to the short-term forecast of the European Commission, milk production will increase further in the European Union in 2021. Assuming that spring and summer weather conditions are favorable for the forage direction of cereal production and the availability of grasses on pastures, the European Commission estimates that in 2021, milk production in the EU-27 is likely to increase by 0.9%, to approximately 156.4 million tone. The expected decrease in the number of cows in the EU-27 this year (by 0.9%, to 20.1 million heads) may be compensated by a further increase in milk yield (by 2%, to 7655 kg / head). As a consequence, EU deliveries of milk for purchase in 2021 are likely to increase by 1%, to 146.8 million tonnes.
Production in Poland
At the end of 2020, the dairy cow population in Poland decreased as a result of the continuation of the concentration processes of the raw material base in the dairy industry. According to data from the Central Statistical Office (GUS), in December 2020 the domestic dairy cow population numbered 2,126,000. pcs and was by 1.9% (by over 41 thousand) lower than in the same month a year earlier. From the beginning of 2021, domestic deliveries of milk for purchase showed monthly fluctuations. According to preliminary data of the Central Statistical Office, in the first quarter of 2021 producers supplied over 3 billion liters of milk to buyers, slightly (by 0.4%) less than in the corresponding period of 2020. The lower level of raw milk deliveries for purchase in the first quarter of 2021 had a limiting effect on development of domestic production of dairy products. According to the Central Statistical Office data in the first quarter of 2021 39,000 tons of skimmed milk powder were produced. It is about 3% less than last year. Butter production was at the level of 65 thousand tonnes, slightly higher (by 0.4%) than in the first quarter of 2020.
In the first half of 2021, the domestic dairy industry is likely to maintain the production of most durable items at a level similar or slightly lower than in the previous year. The structure of industrial production will be largely determined by the supply and demand situation on the domestic and international markets. The course of the COVID-19 pandemic and the scope of the restrictions introduced or lifted for this reason will have a significant impact on the situation on the milk market until the end of the first half of 2021. In Poland, in the first quarter of 2021, despite the downturn in the global milk market, mainly as a result of restrictions related to the spread of the corona-virus pandemic, revenues from the export of dairy products obtained by the domestic dairy industry were higher than in the first quarter of 2020. According to the data of the Ministry of Finance, in the period January-March 2021, the value of dairy products exported from Poland amounted to EUR 604 million (PLN 2.7 billion) and was over 2% higher than in the first quarter of 2020. At the same time, EUR 274 million was spent on import (PLN 1.2 billion), 5% less than in the corresponding period a year earlier. The positive balance of trade in dairy products in the first quarter of 2021 was at the level of EUR 330 million (PLN 1.5 billion), 9% higher than in the previous year.
Export
In the first quarter of 2021, dairy products from Poland were still exported mainly to the EU-27. The share of the EU countries in the total value of exports amounted to 62%. Proceeds from exports to the EU-27 increased by 1% to EUR 372 million. The main recipients of dairy products were: Germany (19% of the value - EUR 115 million), the Czech Republic (6% - EUR 38 million), Italy (5% - EUR 28 million) as well as the Netherlands and Romania (approx. 4% each - 25 million euro and 24 million euro).
In Poland, in the first four months of 2021, the purchase prices for milk were higher than in the previous year. According to data from the Central Statistical Office of Poland, in April 2021 domestic suppliers obtained on average 0.5% more than a month earlier and 15% more than in April 2020 for the raw material. In the period January-April 2021, the average domestic milk purchase price increased by 11%, to PLN 150.63 / hl compared to the corresponding period of 2020. In the following months of 2021, the economic condition of the global market will be determinated by the maintenance of a relatively profitable level of prices for raw milk.
Dairy products
Changes in butter prices in Poland are largely the result of the situation on international markets, and in particular on the EU market. In the first quarter of 2021, the increase in butter prices in New Zealand (which accounts for nearly half of the global exports of this milk fat), limited milk supply in the EU and strong domestic demand on the EU market were factors that had a pro-growth impact on the price of butter in Poland. In April 2021 domestic producers of butter in blocks obtained 1.5% more than a month before and 18% more than a year earlier. In May 2021, butter prices decreased. According to the data of the Ministry of Agriculture, the average price of butter in blocks was 18.48 PLN / kg (including VAT) and was 2% lower than a month earlier, but 44% higher than in May 2020. In Poland, in January-April 2021. sales prices for skimmed milk powder, similarly to foreign markets, showed an upward trend. According to GUS data, in April 2021 producers obtained PLN 11.57 / kg for powder, 3% more than in March 2021 and 19% more than in April 2020. In May 2021, the price increase continued.
Source: Biuletyn Informacyjny KOWR