Milk price drops

Источник: The DairyNews
Milk producers encourage the processors to work out a mechanism of price movement overcoming. But the reason of current milk price drop is likely to be found in consumer demand, global market price and consumers’ capacity to pay decrease.
According to EkoNiva Press-Service, milk price at national average dropped 1.5 rubles per kg. As of March, 30th 2015 average I class milk with basic fat content purchase price in Russia totaled 19.93 rubles without VAT, according to the Ministry of Agriculture information.

Nikolay Somov, Samara Dairy Producers Union Head and Regional Duma Deputy, is sure that further purchase price decrease is inevitable, and this will worsen agricultural producers’ situation as milk production cost increased since autumn 2014 by 30%. Seasonal price movement comes entirely upon producers; the problem is fully concentrated on the lower level and is not divided among other market participants, said the expert.  

The problem of seasonality becomes irrelevant in the context of general consumption level decrease, including dairy products consumption.
According to Sberbank CIB investigation, Russians started sacrificing products’ quality upon the altar of lower price. In QI 2015 75% of Russians considered price to be the primary factor in the process of everyday shopping (73% in QIV 2014).

Global market environment also doesn’t encourage growth of raw milk purchase and suppliers’ price increase. Dairy products price is decreasing. The price index dropped last time by 10.8% at Global Dairy Trade.

Processors’ raw milk purchase price is already decreasing. The level in relative terms is likely to be close to last year, said Andrey Shchetinin, Co-op SPKSSK Chairman. Milk production cost correlation increased this year compared to the previous year by a larger proportion than raw milk purchase prices during the same periods of time. This puts the producers into a tight situation. The existing situation impacts negatively the targeted plan of dairy industry development in general, especially in the light of the fact that big volumes of cheap powdered milk come to the market, added the speaker.
30.01.2024
В России наметилась устойчивая тенденция сокращения поголовья коров: их количество снижается ежегодно, а в 2023 году достигло исторического минимума. The DairyNews обсудил с экспертами отрасли причины уменьшения молочного стада в России. Участники рынка поделились мнением о происходящем и рассказали, как избежать катастрофических последствий для производства молока, молочных продуктов и говядины.
Читать полностью