In Ukraine, there is a decrease in demand for exchange-traded dairy products

Published 2023년 4월 3일

Tridge summary

The article discusses the current situation and future projections for the dairy market in the European Union (EU) and Ukraine. It highlights a decrease in milk prices due to low values of the SZM/butter and bulk cheese/whey powder pairs in the raw milk equivalent, despite stable prices for stock dairy products. This situation leads to potential losses for dry milk and monolith butter producers in Ukraine, and uncertainties about how to handle remaining SZM and dry whey from the winter. Ukrainian processors are adopting a strategy to wait for global price increases to cover production costs, particularly for exports. The article also mentions the ongoing price difference between Ukrainian raw milk and EU standards, with a 20% difference noted last week. The milk equivalent (EM), which is a conversion of the spot value of stock exchange dairy products to the equivalent of a basic kilogram of raw milk, is a key factor in understanding these market dynamics.

Disclaimer:The above summary was generated by Tridge's proprietary AI model for informational purposes.

Original content

The value of the value of the SZM/butter pair in the raw milk equivalent is calculated at 34 eurocents (in the picture), and for the bulk cheese/whey powder pair the equivalent is even lower. All this means that while the prices of stock dairy products are at today's levels, milk on the primary market of the EU will decrease in price, and the spot level will remain in the range of 30-35 euro cents (which allows drying raw materials with a profit). In Ukraine, no one is yet thinking about profitable milk drying (the figure shows that the current levels of raw materials on the spot generate an estimated loss for producers of dry milk and monolith butter at the level of -15-20%), and before the season of "high" milk, processors still do not know what to do with the remains of SZM and dry whey, which were dried in the winter and have not yet been sold. The strategy "we are waiting for the growth of world prices so that exports at least cover production costs" is currently the most ...

Source: MilkUA