Milk prices in Ukraine decreased at the beginning of January due to reduced demand from dairy processing enterprises during the New Year holidays, reported the Milk Producers Association (MPA).
The industry association noted that the average purchase price for extra grade milk as of January 6 was 19.10 UAH/kg excluding VAT, which is 0.60 UAH lower than the previous month, while the highest grade stood at 18.35 UAH/kg excluding VAT (-0.35 UAH), and the first grade remained unchanged at 17.65 UAH/kg excluding VAT. The weighted average price for the three grades of milk was recorded at 18.37 UAH/kg excluding VAT, which is 0.32 UAH less than in December.
"The decline in milk prices in Ukraine at the start of the year has affected the drop in butter prices. A decrease in purchasing activity in the market is also traditionally observed during the New Year celebrations. Additionally, Ukrainian companies reduced their export volumes of butter in December due to falling prices on foreign markets. (…) Surpluses of raw milk appeared in the domestic market, and the maximum prices for extra and highest grade milk decreased due to reduced demand from dairy processing enterprises," explained MPA analyst Georgiy Kukhaleishvili.
MPA reported that there is also a decline in butter prices in Ukraine, coupled with a halt in the price growth of fermented dairy products due to the limited purchasing power of the population and decreased demand for dairy products in the domestic market. Due to high prices for domestic dairy products in December, the volume of imports of finished dairy products, including cheeses, increased in Ukraine.
"A significant decrease in purchase prices in Ukraine is unlikely due to the rising production costs of milk stemming from increased feed costs and the need to comply with EU environmental requirements," emphasized the industry association.
It is likely that by 2025, the global milk market will transition to a new price corridor – between $40 and $50 per 100 kg of raw milk. In 2024, the average price for raw milk in Ukraine was $42.45 per 100 kg, which is 20% higher compared to 2023. The price of raw milk in Ukraine increased throughout 2024, unlike in the EU, the USA, and New Zealand. In 2025, an increase in the average price of milk in Ukraine to $45-46 per 100 kg of raw milk is expected. In the absence of force majeure circumstances, a slight decrease in purchase prices is likely at the end of April to early May of this year due to the seasonal increase in milk production in household farms, MPA forecasts.