Despite an increase in quantity and efficiency in raw milk production, Estonia is still a raw milk exporting nation.
Experts told Eesti Päevaleht that if Estonia would focus on producing milk products, instead of selling raw milk to Lithuania, the regional dairy industry hub, income from milk could double for local producers.
“Estonia and Lithuania have something resembling a colonial relationship. We are an industrial nation where raw milk is exported to those who add value,” Joakim Helenius, head of Trigon Capital, which recently opened Estonia's largest dairy farm.
Head of the Estonian Dairy Association Jaanus Murakas said the industry needs a huge leap in quality, cutting the need to send milk 600 kilometers south. He said Estonia is a world leader in milk production, but all the focus has gone towards building large dairy farms, but the adding value part has been neglected.
Estonia processes around 250 tons of raw milk on a daily basis, around a fifth of Lithuanian volumes.
Murakas said there is hope from the new EU financial period, which runs from 2014 to 2020, adding that 35 to 40 million euros should be diverted to the processing industry, although Agriculture Minister Ivari Padar said only 13 million could be available.
Helenius said the Russian market should not be the aim, as the nation is not a trustworthy partner, and the industry should look towards Scandinavia.
Estonia consumes around 400,000 tons of dairy products each year, while produces close to double that figure of raw milk. The average milk yield per cow has doubled from 1994, to about 7,000 kilograms per year.