Ukraine faces a shortage of powdered milk due to high global prices
The price of powdered milk is rising rapidly in Ukraine and is already approaching a historic high. The price increase is due to high prices on the global market, which make it increasingly more profitable for Ukrainian processors to export their products rather than sell them domestically.
If this trend continues, the domestic market could face a shortage of powdered milk. A decline in supply in Ukraine, in turn, could continue to drive prices higher.
Price Trends and the Situation on the Domestic Market
The global rise in prices for skim milk powder immediately impacted the Ukrainian market. In some countries, Ukrainian products are already being offered at prices significantly higher than those seen this summer.
As a result, low-cost offerings within the country have virtually disappeared, while high-quality products continue to rise in price.
At the same time, prices for whole milk powder are also rising. The potential export value of Ukrainian products is already significantly higher than in July; however, a substantial increase in actual export volumes may not occur due to high demand in the domestic market.
Decline in Production and Fall Forecast
Against the backdrop of the price rally, production volumes of skim milk powder have begun to decline. Following strong summer figures, output in August fell as companies have less surplus raw material available for drying.
In the fall, the downward trend in SMP production will intensify due to a seasonal decline in milk deliveries and the plant’s shift toward producing other dairy products.
Producers of whole milk powder slightly increased volumes at the end of summer, but a renewed decline in output is also expected in the fall.
Due to limited supply and high demand, producers continue to raise retail and wholesale prices, so the price of dry milk in Ukraine will continue to rise this fall.
This was reported by “Infagro.”
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