Dairy industry in sour state (2)

A milk packaging line at Laeva Dairy in Tartu County. (Postimees/Scanpix)
8/17/2015 11:32 AM
Category: Economy

According to Statistics Estonia, the nation's dairy industry is in great trouble as raw milk prices have been low for almost a year.

The average price paid for wholesale milk has been around 25 cents per liter for the last year, dropping to 23 cents this June. The price was around 40 cents at the beginning of 2014.

Many dairy farmers are looking at Statistics Estonia, as many have pegged their contracted sale prices to Statistics Estonia's monthly average. “From one side the active use of statistics is of course welcome, but on the other hand, using it in such as a way may hamper changes to milk prices,” Eva Valdvee, a senior statistician at Statistics Estonia, said.

According to Eurostat, EU's statistics office, milk prices have dropped in nearly all EU member states. Comparing prices in the first quarter of 2014 and 2015, Estonian prices are at 61 percent of the prices in 2014, the figure for Latvia and Lithuania are similar, 65 and 62 percent respectively. The corresponding figures for Finland, Sweden and Denmark are 86, 78 and 74 percent. Prices in Estonia have dropped the most in the EU in the past 12 months, while only in Romania, the prices have increased.

The price of wholesale milk in Scandinavia is also higher, and was on average between 40-57 cents per liter last year. In Estonia, the average for 2014 was 33 cents.

Export prices for Estonian milk have also dropped, from 41 to 25 cents per liter, and volumes are down by a third.

J.M. Laats

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