The deep geopolitical and economic crisis of 2014-2016 has dramatically changed the situation on the Ukrainian market of butter and spreads.
Production of butter has increased substantially, huge surpluses of this product have become available for foreign trade. In the crisis period Ukrainian producers of spreads continued to lose ground. Their business was unprofitable until recently. Now the situation has changed, and this market provides the opportunity to earn money.
Until recently, in the West, Ukraine was considered a serious importer of butter and milk fats. Now the country has virtually ceased to import butter. Moreover, this year it will again be among the world’s leading exporters of this product and increase its foreign sales to record levels of the past 13 years.
By 2014, Ukraine depended on the trends of the world market of butter as an importer, and now it depends on them as an exporter. Therefore, it is very important for dairy market operators to understand all components of the Ukrainian market of butter and distribution of the product, as it is now on the verge of big changes. There are many problems and opportunities that make operators look for effective ways of doing business.
The report we propose will make fulfillment of this difficult task much easier.
The main topics covered in the report are:
Features of the world market
Features of the market of CU countries
Conclusions and recommendations
Main points in brief:
• The crisis has resulted in radical adjustments to Ukrainian market of butter
• Butter production has increased substantially, and production of spreads is still decreasing
• Almost one-third of all milk taken by food industry is used to produce butter (in combination with SMP and casein)
• In the late 1980s more than 300 thousand tons of oil were produced annually in the Ukrainian SSR
• In 2009-2011 only 62-66 thousand tons of butter were produced in Ukraine
• Since the beginning of the crisis, production of butter has increased substantially and, according to the State Statistics Service, it makes 100-108 thousand tons, and according to INFAGRO calculations – about 79-85 thousand tons per year.
• In the future, the volume of production of butter will fall again
• Up to 60% of butter is produced by ten companies
• From 2000 to 2007, manufacturing of spreads increased 7.5 times
• Over the past five years, production of spreads and vegetable and cream mixes has been halved
• Four companies produce three quarters of all volume of spreads and vegetable and cream mixes in the country
• In the current year, consumption of butter will decrease by 15% compared to the pre-crisis year of 2013
• Ukrainians are still buying butter 4 times less than residents of the European Union
• In 2016 on UkrInian market there was sold twice less spreads and vegetable and cream mixes than in 2010
• In the period 2009 – 2013, Ukraine was considered a net importer of butter
• In 2017 once again Ukraine became one of the leading world exporters of butter
• External sales of oil in 2017 will bring about a quarter of all currency earnings from exports of all dairy products
• Ukraine already exports more than half of the volume of produced butter
• Exports of spreads dropped by half in five years
• In mid-2016 exports of butter had to be carried out at record-low prices over the last ten years. In 2017, the product price went up by 60%
• Ukrainian butter is still underestimated by Western traders, often the difference between the world’s and Ukrainian export prices reaches 25%.
• World butter production will continue to grow
• India and the EU account for 60% of the world butter production
• French butter consumption makes 8 kg/person/year and US residents consume only 2.6 kg
• In 2017 world prices for butter reached a record high
• Russia remains the largest importer of butter, despite the list of sanctions and closure of markets in most traditional supplier countries
• Belarus (thanks to the sanctions of Russia) has significantly increased production of butter
• In the ranking of leading butter xporting countries Belarus confidently takes second place after New Zealand
• Kazakhstan will remain a major importer of butter. Almost half of the goods in the country is represented by imports
The report contains 105 figures (diagrams, graphs, maps), 21 tables and the detailed analysis of the information contained therein, as well as forecasts for the further development of the market of butter and spreads.
Volume – 122 pages
Price – negotiable
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