Dairy producers urge milk suppliers to conclude long-term contracts
Industrial dairy farming in Ukraine continued to recover in 2025, and the number of cows in enterprises and private entrepreneurs increased by 2.3%, and raw milk production in 10 months by 7.6%, the Union of Dairy Enterprises of Ukraine reported.
"This year, dairy farms will produce 0.2 million tonnes more milk than in 2024, and the milk processed will exceed 3.6 million tonnes (compared to 3.2 million tonnes last year). These results were made possible by the favorable pricing environment of 2023-2024, which stimulated investments in farm construction and expansion," the business association noted.
However, the industry association noted that the situation became more complicated in the fall due to a sharp drop in world prices. Butter prices in the EU fell by more than 30%, cheese prices fell by almost a quarter, and powdered milk prices fell significantly. This led to a decrease in purchase prices for raw milk worldwide. Since August, FrieslandCampina has lowered them by almost 25%; prices have sagged in the USA, New Zealand, and Mercosur countries. Since November, the decline has significantly affected Ukraine as well, and it will continue into the winter.
Low raw material costs worldwide can lead to the bankruptcy of small farms, especially in the EU. Ukraine has a certain advantage in this situation because it follows the "American model" with large milk production facilities with an average of 300 or more cows, modern technologies, its own feed base, and a lower credit burden.
"After the price crisis ends, which is estimated to last until spring 2026, the global milk supply will decrease and prices will begin to recover. This will create new opportunities for the entire Ukrainian dairy sector, including milk suppliers and processors," emphasized the association.
The Union of Dairy Enterprises called on milk suppliers to collaborate on long-term contracts.