Expert Opinion
Volodymyr Andriets
analyst Association of Milk Producers
Association of Milk Producers

The World Milk Crisis 2020 - what are the scenarios for future events?

The World Milk Crisis 2020 - what are the scenarios for future events? Volodymyr Andriets analyst Association of Milk Producers During the global quarantine analytical…

The negative balance of milk exports reached $ 24 million

Within four months of 2020, the losses from the reduction in exports of Ukrainian dairy products amounted to 22.7 million dollars, the trade balance continues at a negative rate and has already reached 24 million dollars. In total, goods worth $ 64.7 million were exported during this period, which is 26% less than last year. At the end of four months, absolutely all categories of dairy products demonstrate "minus export".

Butter demonstrates the largest decrease: minus 45.5%, only 4.1 thousand tons were sold to foreign markets. Sales of the group of milk and condensed cream products continued to drop: here the decline reached 34% with a total actual weight of up to 6.5 thousand tons. Cheeses have a similar rate of reduction: minus 32%, up to 1.6 thousand tons. Non-condensed milk and cream - 30%, up to 7.6 thousand tons. The situation with fermented milk products trade has deteriorated, and the decline has already reached 13%, to 1.7 thousand tons. The only group of dairy products that showed growth in the first quarter – ice-cream -- in this period also showed losses: 1.7 thousand tons of ice cream exports, that is - 0.6%, up to 1.9 thousand tons.

However, there are positions whose foreign trade has revived, although they are still in the negative zone. This includes whey, which reduced the difference from minus 39% in January-March to minus 25% (7.9 thousand tons) in January-April compared to the same period last year. As well as casein, the increase in exports of which made it possible to reduce the gap from minus 39.5% in January-March to minus 10.7% (985 tons) in January-April compared to last year.

The losses do not end there, because the import of dairy products has not disappeared, but on the contrary - shows growth in all product groups. During this period, products worth a total of $ 88.7 million were imported, which is 156% more than last year. The highest growth is shown by butter, although lower than in previous months, but it is very solid - + 992% (4.1 thousand tons) and the group of condensed milk and cream - + 664% (4 thousand tons). Casein - + 415% (67 tons) is among the three goods whose imports grew the most. Three-digit growth figures are for ice cream - + 184% (159 tons), cheeses - 137% (13.1 thousand tons) and condensed milk and cream - + 123% (1.4 thousand tons), compared to the past year. Least of all, but growing, imports of whey - + 85% (1.3 thousand tons) and fermented milk and fermented products - + 32% (2.6 thousand tons).

Despite the negative balance of foreign trade of dairy products in the first four months of the year, in the coming months there are hopes for a revival of foreign trade and a reduction in the negative trade balance. There are positive preconditions for such expectations, in particular, the traditional seasonal factor of strengthening foreign trade activity and easing global quarantine and restoring demand.

Source: AMP Analytical Department according to the SFSU