The Ukrainian Union of Dairy Enterprises reported a 36% increase in raw milk prices in the second half of 2023, exceeding the level of some European countries. In July 2023, the average farmgate price of raw milk in Ukraine was €33 per 100 kg, but it has now risen to €42 per 100 kg. Farmgate raw milk prices in Ukraine have reached parity with those in other European countries, with milk costing 3.77% more than in Sweden, 3.38% more in Slovakia, and 10.77% more in Latvia. Ukrainian dairy products are no longer appealing to European consumers at their current prices.
A raw milk shortage persists in Ukraine, with prices reaching €50 per 100 kg in recent weeks. This reduces processors’ profitability to zero, making the dairy industry the worst of all agricultural sectors. Authorities could encourage milk farmers to increase production and supply in order to halt the mad rush among processors to fill their capacities. Subsidies for capital costs for new farms could turn the tide in the dairy industry. Meanwhile, milk farm profitability in Ukraine has reached a new high of 30-60%, according to Vadim Chagarovsky, head of the Union of Dairy Enterprises of Ukraine.
