The prices of external demand for butter in the second half of September continued to decline. The main reason is the influence of the external market, a strong decline in prices in Europe and New Zealand. – INFAGRO

Deliveries of butter from Belarus no longer affect the Ukrainian market, as the Belarusian butter is now almost completely sold to the Russian Federation.

The demand prices of Western traders for Ukrainian butter 82% for Africa and the Middle East were set at 3700-3800 USD/t. Even for the dairies that have permission of exports to EU it is difficult to sell butter in the EU more than 4100 USD/t. Due to high prices in Russia, it is now again more profitable to sell butter to the post-Soviet countries. There they pay for it 4000-4200 USD/t.

In the domestic market, the price collapse did not happen only because of the devaluing of hryvnia. High-fat butter in large wholesale is sold for 125-130 thousand UAH/t, and “Selyanske” type – for 105-110 thousand UAH/t.

For supplies to the CIS countries, and even on the domestic market, the prices for butter could increase in the near future, if its offer in the country was smaller. But the stocks of the butter stocks produced in summer are now large and production remains quite significant due to the high activity of the cheese product market operators. Even in the last month, when the problem of export of cheese products was more acute, about 9.5 thousand tons of butter was produced in Ukraine, which is only 6% less compared to the problem-free August of 2017.

In September, production of butter expectedly declined due to the weak activity of milk dryers, but still its supply significantly exceeds the demand.

INFAGRO