Milk production in 2022 due to the military invasion of the Russian Federation will be reduced by 13.3-15.9%, to 7.33-7.56 million tons from 8.73 million in 2021, the depth of the crisis in the industry will be determined by further development hostilities in the country and their geography, the profile association “Union of Dairy Enterprises of Ukraine” (SMPU) reported.
“It is unlikely that with the current development of the military situation, the decline in the production of raw milk will exceed 17%. Such a decrease will not lead to a critical reduction in the supply of dairy products on the domestic market, since the share of consumption reduction due to the migration factor is 18-20%,” – indicated in the forecast on the website of the organization on Friday.
She recalled that since the beginning of the Russian invasion, more than 4 million citizens of Ukraine have left the country, and about 10 million have moved to safer regions. This significantly reduced the demand for dairy products in the country, especially given the almost complete halt in its exports. Thus, due to the departure of some citizens, the average per capita consumption in Ukraine in 2022 will increase by 8% – from 212 kg in 2021 to 229 kg this year.
“For the dairy industry, the first days were also a shock: several international companies closed their milk processing plants, the established logistics schemes for the delivery of raw milk were violated, agricultural enterprises had nowhere to deliver raw milk. Farmers changed routes on the go, milk was delivered where the situation permitted, many raw materials were simply given away for free,” the SMPU clarifies.
At the same time, the enterprises that continued to work changed the range of their products to the most in demand in the conditions of martial law: butter, cheese, milk powder, long-term storage milk. In addition, such enterprises massively donated their products to feed the Ukrainian army, humanitarian supplies and other charitable purposes.
The SMPU clarified that the assessment of the prospects for milk production in Ukraine is becoming more difficult not only because of the uncertainty of the capabilities of farms and processing plants in the territories of active hostilities with Russian occupiers. Important factors that negatively affect milk production are problems with logistics (sales, delivery of feed, veterinary drugs, etc.) and a reduction in the number of cows directly in the combat zone.
“It should be noted that in the regions that are under temporary occupation (Kherson, Mykolaiv regions, the southern part of Zaporozhye) – the volume of milk production was not significant before, which was taken into account in the forecast calculations made by the SMPU,” the organization clarified in the message.
As SMPU previously reported, after the recession of the economy caused by the Russian invasion, 60-65% of milk processing enterprises have already resumed work, which, even in the conditions of hostilities, are able to provide the domestic market, taking into account the migration of part of the population abroad.
