Situation on Milk Market Remains Stable
Milk market goes on demonstrating stable rates. During recent 3 years drinking milk production volumes in the world have stayed almost the same, having increasing in 2012 only by 2%. Leaders in milk supply volumes to the world market are still EU and New Zealand, the total share of which is about 66%. Absence of prospects of significant increases of production volumes provides for high current prices for milk in the world to remain such.
As for Russian milk market, in 2013 livestock of dairy cows increased only in farm households, having stayed the same in other agricultural organizations. Being a natural limiting factor for milk production and a key market factor, livestock provides for no growth and for production volumes to stay on the level of 1 mln t.
Diagram. Production volumes of milk of cattle in November 2012-November 2013, ths. t
Production volumes of milk of cattle in November 2012 - November 2013, ths. t
Source: Federal State Statistics Service, Intesco Research Group
Milk market is one of the most important ones for Russian consumers and demand for milk is constant. Despite keeping the production on a rather high level, Russia is still unable to meet domestic demand by means of its own products: among member states of the Customs Union Russia has the greatest specific share in milk production, but at the same time its per capita milk production is the lowest one.
As a result, milk import volumes annually increase. Since 2009 Russia has increased drinking milk and cream import volumes more than twice. Non-CIS countries account for almost all milk import to Russia, at present, excluding Belarus and Kazakhstan, with Finland, which exported to Russian market more than 15 ths. t of milk in 2012, providing for more than a half of all supplies. Estonia and France are also large suppliers.
Due to increased competition of milk producers of Belarus and WTO member states and increasing dependence on import, allocation of special-purpose subsidies to Russian milk producers is to play a significant role in keeping competition with imported milk products.
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The given values were calculated by analysts of Intesco Research Group on the basis of official statistics.