To talk about quality of raw milk, we must first understand what the regulatory requirements for the quality are. If we declare that we intend to keep the European standards, our regulatory requirements for quality of milk should be the same as in Europe.

Unfortunately, now we do not have the proper regulations. Even the State Standard (DSTU) which is being re-edited again by the Ministry of Agriculture and Food Policy (DSTU 3662-97 ‘Cow milk. The procurement requirements”) in the form it is now, does not correspond the European regulations. We can see that those who has been working over its improvement are not dairy experts, because, in particular, the DSTU does not include certain indicators of safety, the procedure of acidity measurement is not specified there (in Europe milk acidity now is not determined in Turner degrees(° T), but in terms of pH (as active acidity).

I have mentioned these figures just as an example, but what is most import – first of all we should get the proper regulatory documents that will become the norm for producers and processors, because permissiveness and impunity are the reasons of Ukraine’s misfortune. Unfortunately, we have neither scientific professionals nor the Ministry of Agriculture staff who would be capable to produce the quality regulatory document.

Let us take basic indicators for assessing the cost of milk – fat and protein. In Europe, basic fat content is 3.8-4.0%, protein – 3.2-3.4%, and in Ukraine we now have 3.4% and 3.0% respectively. If we accept European standards, the cost of Ukrainian milk will be much lower. This is why milk producers are not willing to accept changes in basic indicators.

But even if such a document would be worked out, it would hardly be possible that processors and milk producers could keep a strict compliance with the new rules, because under condition of raw milk deficit no one would aim high quality. When we reach a certain level of production volume, then we can speak about quality, because the quality will be a measure for raw milk price calculation.

Anyway, the regulations should be devised and accepted, but we must understand that however good they may be, we cannot expect unconditional keeping the rules until there is a shortage of raw materials. To talk about quality, we need to significantly increase production of industrial, I do emphasize this, just industrial milk (made in big dairy farms) . When I say “significantly” I mean 2 times. Then we can talk about the struggle for quality.

I would like to say also, that milk producers have to very actively work on cost reduction. They are now not working on this the same way, as it is done, say, in Europe. Today, in milk price calculation there are many items not related to milk production directly, and which are covered by the price of milk. This leads to overlapping figures and this is how profits are obtained in farms. In addition, milk producers should understand that the profitability of 100%, which they enjoyed in 2012-2013 was left in the past and there will be no similar profitability any more. If we can achieve profitability 25-30% – this would be a great result. But the drop from 100% down to 25% is painful, and in these conditions many farmers do not want to engage in milk production, as it is hard and a long-term business that requires patience. Therefore, we must learn to calculate, we must separate the costs relating to milk production, and those that do not belong. We have to work on the cost reduction every day.

However, I think the issues of production technology, livestock breeding, feeding – these are technical things that producers can do for themselves. The declarations that the state is ready to allocate UAH 300 million to support dairy livestock – is no more than chatter, because, firstly, the money should come from special funds, which are formed, for example, from privatization, and there is no guarantee that they will be transferred to the funds. Second, for the dairy industry of Ukraine UAH 300 million is almost nothing, a drop in the ocean.

Where the dairy industry needs the government support is provision of the access to cheap long-term loans. The state should also guarantee stability of the national currency and compensation on interest on loans. I can give an example: today Polish manufacturer of dairy equipment can get the loan with 2% interest rate in zloty and 0.7% in Euro. And the state guarantees stability. This is how the state should be supportive for the dairy industry. If we had it, then in 5-6 year period we would be capable to twice increase the amount of industrially produced milk which is now 2.7 million tons. And that will be high quality milk, which will make Ukrainian dairy export competitive.

Today there appeared many small dairies that claim that they produce “organic” or “farmers’ products. Frankly, I do not believe in these small businesses, I believe in powerful dairies.  Why? Because large dairy plants use special quality assurance programs for safety and quality control. It is hardly possible that small dairies can afford control quality of the same level.