Price pressure: Surplus production and imports lowered purchase prices for raw milk
11 December 2025 16:40
The Ukrainian dairy market is experiencing a significant decline in purchase prices for raw milk. In early December, the weighted average price of three grades fell by UAH 1.15 to UAH 15.80 per kg excluding VAT.
This was reported by the Association of Milk Producers (AMP), "Komersant Ukrainian" reports.
The main reasons are an excess of finished products in warehouses, the growth of cheap imports and unfavorable global trends.
Collapse in purchase prices
The decline in prices recorded by the Association of Milk Producers (AMP) as of December 9 affected all grades of raw materials, indicating systemic pressure on the market:
- The weighted average price of the three grades amounted to 15.80 UAH/kg excluding VAT (down by UAH 1.15 compared to November).
- Extra grade fell by UAH 1.05 to UAH 16/kg excluding VAT.
- The highest grade cost an average of 15.80 UAH/kg (-1.10 UAH).
- The first grade fell by UAH 1.20 to 15.30 UAH/kg excluding VAT.
Global trends and storage challenges
The Ukrainian market reflects global trends: surpluses of milk and finished products, as global production grew faster than consumption in previous years.
- Shift to long-term storage: Due to market volatility, processors in many countries have switched to the production of long-term storage products (hard cheeses, butter, dried dairy products), which has led to the accumulation of large warehouse stocks.
- Normalization forecast: Global demand is projected to recover slowly, and inventories may only return to normal in the second half of 2026.
Forecast for Ukrainian production
The unfavorable market situation may have a negative impact on domestic production in Ukraine:
- Decrease in production: In 2026, raw milk production is forecast to decline to 6.8 million tons.
- Reasons: This will be influenced by the reduction of milk yields in the private sector, the closure of some small farms and the suspension of production expansion at some dairy farms (MTFs).
- Consolidation: Large farms are likely to focus on optimizing costs and increasing productivity.
- Average price in 2026: The average annual price of milk in Ukraine in 2026 could be around EUR 35 per 100 kg.
Despite the decline in production in households, the industrial sector continues to compensate for these losses, increasing milk yields in 16 regions since the beginning of the year.
