Milk in Ukraine will remain a scarce raw material

The milk shortage in Ukraine will continue this year, experts believe. They point out that from the second half of 2024, prices for dairy products on store shelves will significantly rise. This is because processing enterprises are forced to buy milk almost twice as expensive as six months ago.  

In particular, according to Arsen Didur, the executive director of the Union of Dairy Enterprises of Ukraine, the main reason for the milk shortage in Ukraine, which has worsened due to the war, is the reduction in the cattle population. By the end of 2024, the herd is expected to number 1.26 million head, while analysts predict it will decrease to 1.18 million this year. Additionally, by 2026, the reduction will reach 1.14 million head. Meanwhile, milk production is also decreasing, from 7.3 million tons in 2024 to an estimated 7.1 million tons in 2025. This does not resolve the issue of the raw material shortage, which remains acute and is driving up purchase prices. All this leads to an increase in milk purchase prices. 

It is believed that to overcome the crisis in the market, the milk raw material shortage must be addressed. This requires budgetary incentives to increase the cattle population and milk production by high-performing dairy farms. In the experts' opinion, the revision of the Law of Ukraine on "State Support for Agriculture" should be updated. The document needs to provide for the formation of a new model of state financial support. New operators in the milk production sector are virtually absent due to high capital investments, and the private sector is also showing a decrease in production. Therefore, to avoid price fluctuations in the dairy industry in the future, after the war, the government should consider implementing tax breaks for milk producers. This would encourage more agricultural producers to engage in this business and allow those already involved to expand it. In reality, Ukraine has very high potential for milk production.