DAIRY BUSINESS – 2017: focus on the dairy industry future developments

chagarovsky_20170823-180Vadym Chagarovsky, Board Chairman Dairy Union of Ukraine: Speaking at the DAIRY BUSINESS-2017 conference, I will focus on the forecasts of the development of dairy industry in Ukraine. I would not like to pay too much attention to the figures that are usual for the industry reviews. I would like to focus delegates on modeling: modeling the current situation, identifying regions in which the dairy cooperative movement is most likely and promising. Such regions can be, for example, Chernihiv and Sumy regions.

I will name a sample range of dairies that may be of interest for dairy cooperation. So far, dairy cooperation is now in such condition, that I cannot consider existing forms of cooperation of milk producers and processors as “dairy sooperative company”. I think that it will be interesting for delegates to discuss the opportunities for the development of such companies in Ukraine.

I would also like to speak about business models which our processing enterprises keep in their operations. In my opinion, it’s time to create a new business model. Until now, the successful was the model kept by multinational companies and some of Ukrainian companies, where owners were following the transparent rules of doing business.

Business models the rest of our dairies adhere to – that is, using gray schemes, smuggling, falsification – such models outlived themselves. First, consumers begin to understand what a quality dairy product is, and what are “cheese products”, “sour cream products” and the like. So, consumption of the products with substitutes will be decreasing. Actually, consumption of spreads and cheese products is already decreasing. In addition, the time of earnings in the form of receiving bank loans without the prospect of their return is over. Apart from that, banks now are not capable to issue loans aimed at business development. So it is a very interesting period now. In my presentation at the DAIRY BUSINESS-2017 conference I will speak on the ways of Ukrainian dairy industry development in current situation.

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