Milk raw material prices in southern Russia are 8-10% above the national average, according to Konstantin Sinetsky.
In the agricultural heartland of Kuban, Russia, raw milk prices have been reported to be approximately 8-10% higher than the national average. This price differential is thought to be due to higher production costs and potential local market conditions.
According to Konstantin Sineckii, the general director of the Southern Dairy Union, around 900,000 tons of raw milk from the Krasnodar region are processed locally, while the rest is taken by enterprises in the Rostov region, Adygea, Karachay-Cherkessia, and Stavropol. The annual milk production in the Krasnodar region, as per Sineckii, is around 1.7 million tons.
The higher raw milk prices in Kuban have implications for milk-processing enterprises in the region. These enterprises face increased raw material costs, which can reduce profit margins if retail prices do not adjust proportionally. To maintain competitiveness, they may need to optimize processing operations or innovate product offerings. The higher raw milk cost may also lead to higher prices for processed dairy products from Kuban, impacting both domestic and export competitiveness.
Despite the price increase, Sineckii stated that direct milk producers are currently in a profitable position, as production costs are rising but prices are satisfactory. However, milk-processing enterprises are reportedly operating at the edge of profitability.
The exact quality of raw milk being produced and processed in Kuban is not specified. The higher production costs in Kuban could be attributed to factors such as higher input costs, regional economic factors, and possibly quality factors or supply constraints specific to Kuban.
The average price for raw milk in Russia is around 42 rubles/liter. The specific quality of raw milk referred to in the article is not specified. The information about the milk prices in southern Russia was reported by RBC Krasnodar.
As of August 14, the cost of raw milk in the Kuban region is 8-10% higher than the national average. No reason for the price discrepancy between the national average and the southern regions was provided in the article. The Southern Dairy Union, as well as the location of its operations, were not specified in the report.
[1] Agricultural Market Trends in Southern Russia [5] Regional Economic Factors Affecting Dairy Production in Kuban
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