The price of milk in December reached record levels in 2016. Export oriented market of Ukraine, warmed-up by world dairy prices stopped its record growth in the second half of the last month of the year, say experts of «Infagro».

Despite the slowdown of the index of exchange-traded dairy products, the price of milk in December increased under the «pressure» of manufacturers.

The actual value of the index of raw milk by INFAGRO in December totaled 223 points (preliminary forecast was equal to 222 points), which is 13 points (1.1%) higher than in November.

Due to the decrease in exports of «cheap» (compared to butter and cheese category) milk powder, the index of exchange-traded products were 2 points above the forecast.

According to the actual data for December, the index of exchange-traded dairy products of Infagro amounted to 213 points (preliminary forecast was equal to 211 points), 8 points (3.9%) higher than in November.

During the New Year holidays the supply of raw milk on the market increased as it had been predicted, however, the surplus was not critical: processors directed the surplus into reserves UHT milk, milk powder, butter, cheese), or resell it on the secondary market profitably enough.

The purchase price in the first half of January remained stable as predicted. Only in some regions, processors have reduced too «hot» labels on milk from the population. The milk from this category today is mainly sold in the range of 5,00−6,50 UAH./kg, depending on the region.

Raw milk of the agricultural enterprises of superior and extra grades is estimated in mid-January at 9.00−10.00 UAH./kg, lower-quality product is sold cheaper.

The forecast index of raw milk of Infagro for January remains at the level of December — 223 points, which is 39 points (21.2%) higher than in January last year.

The near future development on the raw material market depends on the activity of exporters. So, while large companies didn’t have foreign contracts «in hands» at the beginning of the year, the prices of raw milk and its fractions balanced, the spot began to gradually become cheaper, and the processors started to think about reducing the purchase price.

But the devaluation of the hryvnia can change the plans of operators in the near future (the same situation was characteristic of the market in early 2015, and 2016).

The forecast growth of the index of exchange-traded products is connected with the change in the exchange rate, which in its turn will not allow the purchase prices to decrease soon.

The forecast index of exchange-traded dairy products of Infagro for January is 218 points, which is 5 points (2.3%) higher than in December and 42 points (23.9%) higher than in January last year.

The index of raw milk of Infagro is displayed as the average cost of a kilogram of milk from farmers (excluding VAT) and population in accordance with the volumes of data of these categories received for processing. January 1, 2011 is taken for 100 items.

The index of exchange-traded dairy products of Infagro is calculated as the average of export prices for the actual export sales in three main products: skimmed milk powder, butter, cheese (cheese product is involved in the volume along with the cheeses, but does not participate in the price). January 1, 2011 is taken for 100 items.

infagro.com.ua