Further price restraint may lead to a deterioration in the financial situation of companies - Artem Belov

Источник: The DairyNews
During the II Congress of Soyuzmoloko.Siberia CEO of Soyuzmoloko Artem Belov said that the moderate dynamics of consumer prices for dairy products in 2020 supported the final demand, but reduced the profitability of producers, writes The DairyNews.

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The expert believes that further price restraint may cause a sharp deterioration in the financial situation of a number of regional companies during 2021.

Artem Belov noted that in 2020, the dairy industry had a minimal price increase among food categories, and in the summer, the price index fell into a negative zone. According to the expert, the weak dynamics of consumer prices is due to weak effective demand. At the same time, socially significant goods: drinking milk, fermented dairy products, dry infant formula – in 2020 showed lower growth rates than the average for the category.

‘The restraint of consumer prices against the background of rising costs has a negative impact on the economy of the dairy industry. Retail chains dictate the rules: the increase in their share in the retail trade turnover increases the role of retail in the formation of pricing policy,’ said the CEO of Soyuzmoloko.

He believes that in 2021, we will have to find a compromise between translating the growth in cost into price and weak effective demand. Moreover, the mandatory labeling of dairy products, in his opinion, will serve as an additional factor in raising prices.

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