Production of whole-milk production by the Belarusian enterprises in 2013 made 1.8
mln tons.
The share of production of dairy branch for the last years takes the 3rd place in a total amount of export of Belarus and makes 3.9%. 1.4% of world production of milk and 5% of world export dairy are the share production of Republic of Belarus. In 2012 the share of Belarus in world export of oil made 7.6%, cheeses – 5.5%, dried skim milk — 3.2%, dried whole milk – 1.2%. The main direction of export of the country is Russia – one of the largest importers of dairy products in the world. A share of the Belarusian export of dairy products to Russia – more than 90%.
Volume of output of unpasteurized milk by the belarusian enterprises in 2013 fell in relation to 2012 to 1.7% and made 6.7 mln tons. For the last seven years average annual rate of a gain made 2% a year. For January-December 99.1 thsd tons of butter (87.9% by 2012), 132.3 thsd tons of cheeses (90.5% by 2012), 1.8 mln tons of whole-milk production was produced (104.8% by 2012). According to the Program of development of dairy branch in 2010-2015, gross production of milk has to increase to 10 mln tons by 2015.
The product range in the market of Belarus totals more than 1000 names. In domestic market of Belarus more than 32% of domestic dairy products are realized. The population of the republic spends about 8% of total consumer expenses for dairy products. In 2013 consumption growth – 98 kg on the person that is 2.7% more, than in 2012 was observed. Market capacity made 925 thsd tons.
As a result of the essential volume of grants to agriculture Belarus possesses the most qualitative source of raw materials in comparison with all CIS countries that provides a good competitive position of the Belarusian dairy products in the markets of the CIS countries (Russia, Ukraine, etc.). The prices of unpasteurized milk are regulated by the government of RB: extra prices are established for each grade of milk. Usually decisions are made by the government 2 times in a year (spring/fall).
In Republic of Belarus there are about 40 enterprises, engaged in milk processing. The largest enterprises of branch are: "Savushkin produkt", "Babushkina krynka", "Molochnyje produkty", "Bellakt", "Milk Vitebsk", "Berezovsky syrodelny combinat", "Slutsky syrodelny combinat", "Gluboksky MKK".
Nowadays there is a strengthening of concentration of the enterprises of the dairy industry and increase in a share of the state by redemption of stocks at natural persons, accession of the small and unprofitable enterprises controlled by the state to larger and effectively working, the transfers of stock belonging to collective farms, the state.
In Belarus there was planned the creation of milk-processing holding which would be created on the basis of 6 enterprises. As the uniting center would act Joint Stock Company "Savushkin produkt". Except it into holding would enter Joint Stock Company "Berezovsky syrodelny kombinat", Joint Stock Company "GMZ No. 2", Joint Stock Company "Kobrinsky maslosyrzavod", Communal Unitary Enterprise "GMZ № 1", and also Joint Stock Company "Luninetsky molochny zavod". However the late government refused plans for creation of holding.
About 5% of world export of dairy products are the share of
Belarus.
In Belarus there are about 40 enterprises on milk processing.
The prices of dairy products are regulated by the government: the new prices are established
2 times a year.
In 2013 consumption of dairy products per capita made 98
kg on the person.
One of the main tendencies of branch – strengthening of
concentration of the enterprises.
The concept of the National dairy company led by Joint Stock Company “Savushkin
The output of unpasteurized milk in 2013 made 6.7 mln tons. For the last 7 years outputs of unpasteurized milk in Belarus increased on the average by 2% a year, despite insignificant falling of production in 2011 and 2013. Production of whole-milk production shows growth on the average for 5.5% annually, insignificant recession was observed only in 2009 that was caused by contradictions in coordination of terms of delivery of dairy products to Russia. In 2013 production of whole-milk production made about 1.8 mln tons (growth in 4.8% in relation to 2012). The butter output in 2013 made 99.1 thsd tons of oil (growth rate of 87.9% by 2012) over the last 5 years average annual rates of a gain remained at the level of 3%. In production of cheeses fluctuations are observed: recessions in 2007, 2010 and 2013. However average annual rate of a gain for the last 7 years made 3%. In 2013 132.3 thsd tons of cheese that is 9.5% more, than in 2012 were made.
The structure of production of dairy products of Belarus is rather various. 51% of whole-milk production made in the country are the share of whole milk, on the second place – kefir and cheeses (on 12% every).
Prospects of production of dairy products in Belarus for the next 3-4 years are rather positive that is defined by growth of internal demand, and also expansion of geography of export of dairy products. At the same time the market of dairy products with a long period of storage is characterized by strong dependence on market condition where there is a number of the countries (New Zealand, EU countries, Australia and the USA) which form world price politics. Competitiveness of the Belarusian producers while concedes to them.
Source: Belstat
Production
DAIRY INDUSTRY
Source: Belstat, YuNITER Source: Belstat
Source: Belstat
Source: Belstat
Whole milk 51%
Cheese 12%
Kefir 12%
Butter 9%
Sour cream 8%
Fat cottage cheese
5%
Others 2%
Cheese curds 1%
Production of dairy product by type
March, 2014
CAGR=2%
CAGR=5.5%
CAGR=3%
CAGR=3%
5.9
6.2
6.6 6.6 6.5 6.8 6.7
105.1% 106.5%
100.0% 98.5%
104.6%
98.3%
90%
95%
100%
105%
110%
5
5.5
6
6.5
7
2007 2008 2009 2010 2011 2012 2013
Dynamics of production of unpasteurized milk in Belarus, mln tons
Production of milk Growth rate
1326 1332 1308 1432
1559 1 776 1827
100.0%
100.5% 98.2%
109.5% 108.9%
113.9%
104.8%
90%
95%
100%
105%
110%
115%
120%
0
500
1000
1500
2000
2007 2008 2009 2010 2011 2012 2013
Dynamics of production of whole-milk products, thsd tons
According to opinion polls, only from 7.8% to 11.4% of the population of Belarus don't buy dairy products. The most popular product among the Belarusian consumers is milk (95.3%), on the second place – kefir (66.2%). The least popular dairy desserts - 3.9%.
In dynamics of consumption of dairy products and market capacity of Belarus fluctuations – recessions in 2009 and 2012 are observed. In 2013 consumption growth – 98 kg on the person that is 2.7% more, than in 2012 was observed (95 kg on the person in 2012).
Market capacity in 2013 made 925 thsd tons while in 2012 the market capacity of whole-milk production made approximately 901 thsd tons. In 2013 value of an indicator of market capacity started being restored after sharp falling in 2012 the lowest indicator of market capacity in 2012 it is possible to explain with strengthening of export of whole-milk production at insignificant increase in production.
According to National statistical committee of Republic of Belarus, the population of the republic spends about 8% of total consumer expenses for dairy products. Sales of cheeses in 2013 made about 41 thsd tons (in 2012 – 40 thsd tons). Butter retails in 2013. were slightly reduced – to 30 thsd tons.
Source: Yuniter Source: Belstat
March, 2014
32 33 31 31 30
35
41 41 40 41
0
5
10
15
20
25
30
35
40
45
2009 2010 2011 2012 2013
Retail, thsd tons
Butter Cheese
999 1027 919 984 1065 901 925
104
108
97
104
112
95
98
85
90
95
100
105
110
115
800
850
900
950
1000
1050
1100
2007 2008 2009 2010 2011 2012 2013
Consumption of whole-milk products
Capacity, thsd tons Consumption per capita (kg)
3.9
5.8
8.6
23
32
55.6
63.7
66.2
95.3
0 25 50 75 100
milk desserts
sour-milk drinks
ryazhenka
curd-cottage cheeseproducts
yoghurts
cottage cheese
sour cream
kefir
milk
Preferences of amateurs of dairy products in Belarus, % from total number
More than 60% of the dairy products made in Belarus go for export. Specific weight of export of dairy products in relation to the total amount of production of milk in 2013 made 67%, thus in 2000 it made 15%, in 2005 – 40%.
Belarus is among the main exporters of dairy products in the world. According to IDF reports (The international dairy Federation) in the list of leading world exporters of dairy products (without trade between EU countries) in a segment of firm cheeses Belarus takes the fifth position in the world (55% of world export), on dry skim milk — the fifth position (3.2%), and on powdered whole milk – the sixth (1.2%). More and more stable growth of volume in structure of global trade noted oil export which takes the fourth position, having conceded 0.2% of the USA — 7.6% of the universal volume of export of oil.
In 2013 Belarus exported more than 4.4 mln tons of dairy products in recalculation on milk for the total amount nearly 2.3 bln USD. Export of dairy products from Belarus in kind from 2007 to 2013 grew on average for 10% annually. Only in 2009 decrease in export deliveries in value terms because of "dairy wars" with Russia to which share more than 90% of export of dairy products from Belarus fall was observed.
Source: Comtrade, Yuniter
Source: Comtrade, Belstat
Source: Comtrade, Belstat
CAGR=10%
March, 2014
2 488 2 614
3 390
3 780 3 815 4 136
0.421 0.42
0.515
0.57 0.583 0.611201419
0.0%
10.0%
20.0%
30.0%
40.0%
50.0%
60.0%
70.0%
0
500
1000
1500
2000
2500
3000
3500
4000
4500
2007 2008 2009 2010 2011 2012
Dynamics of the export of dairy production
Dairy products export in terms of milk, thsd tons
Export share in milk production, %
1051 945
1500 1620
1840
1 005 831
1 390 1 473
1 662
40.9 35.1 45.4 37 40.2
0
500
1000
1500
2000
2008 2009 2010 2011 2012
Dynamics of export-import of dairy products in value terms, mln tons
In 2013 Belarus exported 292 thsd milk and cream which isn't condensed or 31.2% of the total amount of export of dairy products. 25.5% were the share of the milk and cream condensed or 238 thsd tons in terms of milk. The smallest share in export is the share of buttermilk, yogurt and kefir and butter – 6-7%. On foreign markets in 2013 it was delivered to 141 thsd cheese and cottage cheese (15%), 121 thsd tons of whey (13%).
The greatest share in commodity structure of import of dairy products is the share of buttermilk, yogurt and kefir – 52% (16.6 thsd tons). Cheeses and cottage cheese make 19.8% or 6.3 thsd tons. Import of other production is insignificant: milk and cream condensed – 6.7% or 2.2 thsd tons, whey – 16.8% or 5.2 thsd tons, milk and cream not condensed – 3.5% or 1.1 thsd tons, butter – 1.1% or 0.4 thsd tons.
Now Belarus delivers dairy products to 50 countries of the world. At the same time the main importer is the Russian Federation. Exactly a half of all volume of the Russian import of milk and dairy products is the share of Belarus. As show data of the Russian customs statistics, production of the Belarusian production prevails in import of all main groups of dairy products, including group of cheeses and cottage cheese.
Estimating prospects of deliveries in long-term prospect, it is worth paying attention that in Russia work on development of national dairy branch is conducted and the threshold border on milk and the dairy products, equal 90% of providing is established by a domestic production. The industry program of increase in production of butter and the cheese, providing achievement in 2013 of production of butter – to 264 thsd tons (decrease in a share of import to 27%) is signed. Therefore it isn't excluded that in 3-4 years the volume of export of the Belarusian oil and cheese to Russia can be reduced considerably.
Belarus also exports dairy products to Kazakhstan, Ukraine, Venezuela and some EU countries.
Source: Comtrade, Belstat
March, 2014
Russia 87.8%
Venezuela 9.0%
Kazakhstan 2.6%
Others 0.6%
Structure of export of powdered whole milk in 2013
Milk and uncondensed cream
31%
Milk and cream
condensed 26%
Buttermilk, yoghurt,
kefir 6%
Whey 13%
Butter 7%
Cheeses and cottage
cheese 15%
Commodity structure of export of dairy branch of Belarus, 2013
Milk and cream
uncondensed 3%
Milk and cream
condensed 7%
Buttermilk, yoghurt,
kefir 63%
whey 17%
butter 1%
Cheeses and cottage
cheese 20%
Commodity structure of export of dairy branch of Belarus, 2013
In Republic of Belarus there are about 40 enterprises which are engaged in milk processing. The largest enterprises of branch are "Savushkin produkt", "Babushkina krynka", "Molochnyje produkty", "Bellakt", "Milk Vitebsk", "Berezovsky syrodelny combinat", "Slutsky syrodelny combinat", "Gluboksky MKK".
The tendency of consolidation of the enterprises of the dairy industry is observed: the small and unprofitable enterprises controlled by the state join to larger and effectively working - thus, integration of the milk-processing enterprises is made. Besides, successfully to compete in foreign markets promotes created at the initiative of the government of Joint Stock Company “Meat-and-milk company”.
At the same time there is a competition toughening in domestic market owing to achievement of high extent of saturation of the national market by dairy products. It should be noted that competitiveness of the last considerably increased, thanks to introduction of the modern technologies improving quality of production, providing longer expiration dates and guaranteeing its safety for the consumer.
One of the Belarusian dairy products making competitiveness is their branded component. Several years ago except "the Savushkin produkt" in the market there were no professionally branded dairy products. Now the situation changes every day. The consumer already knows and chooses such brands as "Babushkina krynka", "Zdravushka", "Bellakt", "Kalinka", "Moja Slavita", etc.
In 2010 MRR Consulting agency started the long-term project of an assessment of national brands within which the Rating project "Belbrend-2010 – the TOP of-100 Belarusian brands" appeared. Was to determine by the main task of the “Belbrend” project 100 most expensive Belarusian brands.
13 representatives of the dairy industry entered this rating of 2013. The third position in a rating "TOP 100 of the Belarusian brands" was taken by "Babushkina krynka" 2013, the cost of a brand made 65.4 mln US USD. It should be noted that in 2011 the brand was estimated at 5.55 mln US USD and took the 57th place. In 2011 the leader among the milk-processing enterprises was the brand "Savushkin produkt" which took the 4th place with an assessment in 50.0 mln US USD, in 2012 and 2013 "Savushkin produkt" took the 7th place with an assessment in 46 and 46.4 mln US USD respectively.
Following the results of activity in 3 quarters 2013 the company Savushkin produkt (206 mln USD) became the leader in revenue volume among dairy plants having been ahead of the last year's leader Slutsky syrodelny combine by 23 mln USD. Joint Stock Company "Babushkina krynka" still enters in TOP-3 the largest dairy plants of Belarus with revenue for 3 sq. 2013 - 233 mln USD. In TOP-5 Joint Stock Company "Rogachevsky MMK" (159 mln USD) and Joint Stock Company "Molochnye produkty" (157 mln USD) also enter.
At the same time on an indicator of net profit for January-September, 2013 first place is won by Slutsky syrodelny combine (25 mln USD). And the largest dairy company Savushkin produkt for this period showed only the fourth result – 11.7 mln USD, having conceded to Lidsky MKK and Volkovyssk Bellakt.
According to the reporting in 3 quarters 2013 neither Savushkin produkt, nor Babushkina krynka entered in TOP-7 on a profitability indicator on net profit. The greatest profitability for this period showed Lidsky MKK (12.2%), Volkovyssk Bellakt (10.3%) and Slutsky syrodelny combine (8.8%).
On a revenue indicator on the one worker in 2013 Joint Stock Company "Molochnye produkty" – 125.9 thsd USD of the USA on the one worker in 3 quarters 2013 continues to be in the lead. It is followed by Lidsky MKK with an indicator of 122 thsd USD of the USA. Savushkin produkt is on the third place – 118 thsd USD of the USA.
As a whole 2013 was positive for dairy combines of Belarus: following the results of three quarters any enterprise of dairy branch didn't show a loss, the majority of the companies managed to increase sales, export and financial performance.
Source: Minfin
Source: Minfin
Source: Minfin
Source: Minfin
November, 2013
TOP-7 on sales proceeds in 3 quarters of 2013, mln USD
306
283
233
159
157
136
128
0 100 200 300 400
Savushkin Produkt
Slutsky cheese-making…
Babushkina Krynka
Rogachevsky MKK
Molochniye Produkty
Lidsky concentrated milk…
Berezovsky cheese-…
135
122
118
96
95
92
87
0 50 100 150
Molochniye Produkty
Lidsky concentrated milkenterpise
Savushkin Produkt
Babushkina Krynka
Bellakt Volkovyskoe
Minsky Molochny Zavod №1
Rogachevsky MKK
TOP-7 on revenue on one worker in 3 quarters of 2013, thsd USD
12.2%
10.3%
8.8%
8.1%
7.4%
6.3%
5.7%
0 0.05 0.1 0.15
Lidsky concentrated…
Bellakt Volkovyskoe
Slutsky cheese-…
Berezovsky cheese-…
Minsky Molochny …
Molochniye Produkty
Lepelsky…
TOP-7 on profitability on net profit in 3 quarters of 2013, %
JSC “Savushkin produkt” is the largest producer of dairy products in Belarus.
The commodity distribution network of JSC Savushkin produkt includes 6 trade branches, 1 trade mission and more than 50 sales representatives in the territory of Belarus.
In recent years the enterprise develops prompt rates. Since July 1, 2012 JSC “Savushkin produkt” has the right to deliver dairy products to the European Union countries.
The range differs a big variety (more than 200 names).
In April, 2013 construction of the fifth production site of JSC Savushkin produkt is begun. The new production case will be constructed in Brest near head office of the enterprise. In it shops on production of whole-milk production will take place. In June of JSC ЭSavushkin produkt" passed certification on compliance to the new international scheme of FSSC 22000.
Joint Stock Company «Babushkina krynka»
JSC “Babushkina krynka” - one of the largest producers of dairy products in Belarus. Capacities of the enterprise allow to overwork to 1700 tons of milk per day.
Export volume in 2013 made 207.9 mln US USD that is almost twice more than two years before. Production of JSC “Babushkina krynka” is delivered to all regions of Republic of Belarus, and also on the markets of Russia, Ukraine, Poland, Germany, France, Egypt, Pakistan and Philippines.
The main production of JSC “Babushkina krynka” is: milk dry fat-free, butter, cheese firm and semi-firm, cheeses soft, whole-milk production: kefir, sour cream, cottage cheese, cream drinking, heat-treated and drinking yogurt; curd cakes glazed; ice cream; mayonnaise; substitute of whole milk (SWM).
Into structure of JSC “Babushkina krynka” enter: head enterprise in the city of Mogilyov, seven milk-processing plants of the Mogilyov area and agricultural enterprise in the Hotimsky area. At the end of 2013 documents on accession Mstislavl's Maslodelno-syrodelny plant in JSC “Babushkina krynka” holding structure were signed.
Source: Minfin
Source: Minfin, prime-tass
Source: Minfin
Source: Minfin
Source: Minfin
November, 2013
148.7 191.6 187.2
249.6 265.3 340.4
306.0
0
100
200
300
400
2007 2008 2009 2010 2011 2012 3 кв. 2013
The taking of JST “Savushkin produkt", mln USD
7.9
3.6
7.5
0.7
8.2
3.4
11.7
0
5
10
15
2007 2008 2009 2010 2011 2012 3 кв. 2013
Net profit of the JSC “Savushkin produkt”, mln USD
95.2 130 121.4
153.6 142
257 233
0
100
200
300
2007 2008 2009 2010 2011 2012 3 кв. 2013
The taking of JSC “Babushkina krynka”, mln USD
6.2 0.5
3.9
10.5 6.8
0.4
11.0
0
10
20
2007 2008 2009 2010 2011 2012 3 кв. 2013
Net profit of the JSC “Babushkina krynka”, mln USD
70.7 56.4 92.1 104.9
172.4 207.9 54%
46%
60%
74% 67%
0%
20%
40%
60%
80%
0
100
200
300
2008 2009 2010 2011 2012 2012
Dynamics of export of JSC “Babushkina krynka”, mln USD
As one of export intensification mechanisms the Belarusian state considers consolidation of branch. This process already happens. For example, if in 2009 in dairy branch 143 companies, in 2013 - only 40 worked.
In Belarus creation of milk-processing holding which would be created on the basis of 6 enterprises was planned. The uniting center would act as JSC "Savushkin produkt". Except it the holding would include JSC "Berezovsky syrodelny kombinat", JSC "GMZ № 2", JSC "Kobrinsky Maslosyrzavod", CUE "No. 1 GMZ", and also JSC "Luninetsky Dairy Plant". However the late government refused plans for holding creation.
In June, 2009 the company "Yunimilk", the largest in Russia on processing of milk signed the agreement on implementation of the investment project on creation of production of whole-milk production with the Mogilyov regional executive committee, Shklovsky district executive committee and maslodelny plant. Now the Danon-Yunimilk company owns in Belarus two enterprises — "Yunimilk-Pruzhany" and "Yunimilk-Shklov". The share of the French-Russian company in both joint ventures makes 51%.
The “YUNIMILK” company plans to invest also in cluster creation on production of cheeses and milk canned food in Belarus on the basis of the Yunimilk-Shklov enterprise. Investments will make about 80 mln euros till 2017. The main sales market of future cluster – the Russian Federation.
Besides, now in Lepel on the basis of concentrated milk combine the joint venture with participation of the Russian investor is created.
The Lithuanian companies showed a certain interest to privatization of the enterprises of the dairy industry. In particular, plans of possible purchase of actions of the 1st and 2nd Minsk city dairy plants the Zabolis and Partners company together with Zemaitijos Pienas and Rokiskio Suris sounded. However on the matter Ministry of Agriculture and Food Production developed an accurate position about inexpediency of sale of data of the enterprises in connection with carried-out work on creation of the relevant holding.
One more Lithuanian company Pieno chvaigchdys planned purchase of large dairy combine in Belarus, in particular, of Berezovsky syrodelny combine (Brest region). Considering that Berezovsky syrodelny combine is included into the list of the companies planned to association within creation of the National dairy company its acquisition of Pieno chvaigchdys is improbable.
Now there is a strengthening of concentration of the enterprises of the dairy industry and increase in a share of the state by repayment of actions at natural persons, accession of the controlled state small and unprofitable enterprises to larger and effectively working, the transfers of stock, belonging to collective farms, the state.
DAIRY INDUSTRY
Foreign capital
According to the Republican Program of development of dairy branch in 2010 - 2015 it is supposed:
3 agricultural organizations of the Volkovyssky area
JSC «Bellakt»
JSC “Smolevichsky Dairy Plant”
JSC “Smolevichsky Broiler Poultry Farm”
JSC “Babushkino podvorye” JSC “Babushkina
krynka”
In 2007 meeting of shareholders of JSC "Bellakt" (Volkovysk, the Grodno region) made the basic decision on sale of 51% of actions to the state. It was reported that this decision is made due to the need of attraction of large borrowed funds to carrying out the second turn of reconstruction of the enterprise. Thus, more than 50% of shares of Volkovyssky JSC "Bellakt" were redeemed by the Grodno executive committee. Up to this point all actions belonged to natural persons.
According to YuNITER forecast, in 2014 increase in production of dairy products is expected. In particular, the output of whole-milk production will increase for 4.2% in comparison with 2013 and will make 132.9 thsd tons. The republican program of development of dairy branch in 2010-2015 assumes realization of actions for creation of optimum conditions for development of the milk-processing organizations and formation of flexible structure of production therefore in the next 2 years in production of dairy products positive dynamics will remain and by 2015 capacities on processing of milk will reach 9.2 mln tons a year.
By results of realization of actions of the Program, internal demand of a pas is planned to satisfy dairy products at the expense of a domestic production. It is thus supposed to export about 60% of made production. In 2014 growth of export deliveries by 16.3% is expected, and by 2015 export volumes of dairy products will increase in financial expression by 1.4 times.
As for import of dairy products, rates of a gain of deliveries from abroad in 2014 are expected at the level of 2.1% and in the next year the tendency of reduction of a gain of import will remain. In 2015 value of this indicator will decrease to 1.9%. The gain of positive foreign trade balance in 2014-2015 is probable at the level of 16-17%.
The Belarusian dairy branch is under state control, in particular, there is a regulation of selling and purchase prices. Besides the private initiative is controlled: privatization of the dairy enterprises of Belarus is improbable, according to government statements.
The prices of unpasteurized milk are regulated by the government of Belarus: extra prices are established for each grade of milk. Usually decisions on the change in price are made by the government 2 times in a year (spring/fall). It should be noted that price restrictions are present only on a number of products, generally on goods without any additives (the lactic bacteria, fruit ingredients enriching substances and so on).
Access to raw materials (unpasteurized milk) for processors also is regulated at the state level. Each milk-processing enterprise has the raw zone fixed to it consisting of the agricultural organizations of nearby areas. Raw zones are assigned to dairy plants the relevant decisions of regional executive committees. Processors work with suppliers of unpasteurized milk on the terms of an advance payment, thereby carrying out function of support of the agricultural enterprises.
The program for development of dairy industry in 2010-2015.
In 2010 in Belarus the Republican program of development of dairy branch in 2010-2015 was approved.
The program purpose – increase in gross production of milk in 2015 to 10 mln tons. The program is directed on increase in economic efficiency of dairy branch. There is a task to increase competitiveness of production. In Belarus there are a lot of farms which work in the old adapted rooms therefore construction of new dairy and commodity farms with application of modern technologies, and also reconstruction of the existing is planned.
According to the resolution, in implementation of the program it is planned to enclose 33 trillion BYR. For financing of the program it is planned to attract credit resources of banks, including means of foreign credit lines.
By results of implementation of the program domestic market of consumption of dairy products will be satisfied completely due to own production. In 2015 41% of dairy products are provided to be realized in domestic market, 59% - to export.
DAIRY INDUSTRY
Legal environment
Processing of milk, mln tons 9.2 Release of whole-milk production in terms of milk, mln tons 2
Production of cheeses, thsd tons 203
Production of butter, thsd tons 180 Release of dry dairy products (fat and fat-free powdered milk, dry buttermilk), thsd tons 300
production of baby food, thsd tons 43
Capacities in 2015 according to the Program of development of dairy branch of Republic of
Belarus
March, 2014
Source: The resolution of Council of ministers of November 12, 2010 No. 1678
In January – December, 2013 total production of whole-milk production made 1 827.2 thsd tons, that is 4.8% more, than for 2012.
In Belarus, as well as around the world in dynamics of production of dairy products in a year seasonality is accurately traced: in the first and second quarter increase in production (the peak of production falls on the second quarter) is observed, then in the third and fourth quarter volumes of release decrease. The main reason for seasonality of production of milk – unevenness of distribution of calving of cows and heifers within a year.
Export of dairy products in 4 quarters 2013 made 934.2 thsd tons. In comparison with 2012 export grew by 8.3%. In the third and fourth quarter export growth was slowed down and even became negative. It can be connected with that in September, 2013 Rospotrebnadzor declared existence of claims to quality of the Belarusian dairy products. Department reported that in many samples of the Belarusian production checked lately didn't conform to requirements of quality and safety.
The greatest share in export of dairy products is the share of milk and cream not condensed (31% or 291.7 thsd tons) and of milk and cream condensed and dry (25% or 238.2 thsd tons). On cheeses and cottage cheese 15% of export of dairy products, were the share of whey – 13%, and 7% and 8% for butter and buttermilk, yogurt and kefir respectively.
The greatest growth of export by types of production in January December, 2013 in comparison with 2012 was observed for whey (+70.1%) and for buttermilk, yogurt and kefir (+46.1%). On the main export product – milk and cream not condensed – in 2013 there was an insignificant decrease in export deliveries (-3.0%). Also significantly butter export (-19%) fell.
Import of dairy products is much less than its export that testifies that Republic of Belarus is net - the export of dairy products. However import volumes for January – December, 2013 increased by 67.6% in comparison with January – December, 2012 and made 32.0 thsd tons in kind. In a section of types of production the greatest volume of import is the share of yogurt, kefir and buttermilk – 16.6 thsd tons or 52%. The volume of import of cheese and cottage cheese made 6.3 thsd or 20% of the total amount of import. The smallest share in structure of import of dairy products is occupied by butter – 1%.
Source: Belstat
Source: Belstat
March, 2014
Jan.-Dec. 2013
Jan.-Dec. 2012
Change %
Cheeses and cottage cheese 141.0 144.4 -2.3%
Butter 69.3 85.6 -19.0%
Whey 121.2 71.3 +70.1%
Buttermilk, yogurt, kefir 72.8 49.8 +46.1%
Milk and cream condensed and dry 238.2 210.8 +13.0%
The milk and cream which aren't condensed 291.7 300.6 -3.0%
Export of dairy production in January-December 2013, thsd tons
432.6 445.9 440.1
425.4
454.7
400
420
440
460
480
1 Q 2 Q 3 Q 4 Q
2012 2013
Production of whole-milk products (in terms of milk), thsd tons
The program of development of dairy branch isn't carried out because of shortage of means
Now the Republican program of development of dairy branch in 2010-2015, providing serious measures for technical re-equipment of the enterprises is realized.
According to the program Belarus plans to launch production of 10 mln tons of milk a year, the number of a livestock of cows has to make 1 mln 600 thsd. For 2011-2013 in agriculture it is enclosed by 5 bln USD from which more than 2 bln USD - on dairy and commodity farms, however the program isn't carried out in terms.
In comparison with last year in a number of areas production of milk and volumes of realization of dairy products decreased. Also low productivity of implementation of the program of construction of new dairy and commodity complexes is noted. Till October, 2013 it was planned to finish reconstruction of 1208 dairy and commodity farms at the expense of own means of agricultural enterprises, however even until the end of the year will only 940 be put into operation.
The large-scale program of reconstruction of dairy farms yielded the return result. The agricultural enterprises weren't able to make modernization independently. Now over all country the new processing equipment is put less than for 10% of dairy farms.
Major factor why reconstruction of dairy farms wasn't executed in terms are financial difficulties. The authorities, using the administrative lever, compel heads of the agricultural enterprises to carry out payment of works on reconstruction and MTF construction at the expense of own means that washes away financial means and attracts growth of non-payments in the agriculture sphere in other directions.
Thus banks refuse to allocate the new credits to the agricultural enterprises. Target public financing could become the only tool which would allow to finish the program of development of dairy branch. However the government insists on use of own means of the agricultural organizations, and also on attraction of financial resources of investors, credit resources of banks, including foreign credit lines.
The Turovsky dairy combine bought two agricultural enterprises
Shareholders of Turovsky dairy combine issued the transaction on purchase of 2 producers of agricultural products. For JSC "Dyakovichi" and JSC "Priozersky-Agro" actions which were earlier belonging to the area, about 4.2 mln USD are paid. 100% of actions of JSC "Dyakovichi" cost to shareholders of TDC 12,76 bln rubles, 73.5% of JSC "Priozersky-Agro" – in 28.734 bln rubles. Other shares of "Priozersky-Agro" were redeemed by TDC in 2012. Soon TDC plans to invest 50 bln more rubles in development of a source of raw materials.
The Turovsky dairy combine – the youngest milk-processing enterprise of Belarus. The Turovsky dairy combine was constructed from scratch, the first stage is put into operation in 2013.
New "dairy" war with Russia
Russia can enter certain measures concerning the Belarusian dairy products for protection of the market against unfair competition. Thus measures will be directed or directly on dairy products, or in other directions of cooperation.
In September, 2013 Rospotrebnadzor declared existence of claims to quality of the Belarusian dairy products. Thus Belarus intends to appeal to EurAsEC Court concerning statements of Russia for a poor quality of the Belarusian meat and dairy production.
In Belarus already repeatedly declared that it is not about the Belarusian production, and about its fakes. The Belarusian party also addressed to the Rosvetnadzor that through joint efforts to trace a situation in the food market of both countries.
"Biokom" bought part of the stocks of "Bellakt“
JSC "Biokom" got more than 12% of an authorized capital of JSC Bellakt. Amount of transaction – 1.5 mln USD "Biokom" took the shares of the enterprise belonging to the minoritary natural persons. Actions were consolidated previously by the professional participant of stock market of JSC "Western Share Bureau".
The Grodno regional executive committee which possesses the privilege of purchase of actions of the enterprise, coordinated sale of shares to the private investor. At the same time the Grodno regional executive committee still had controlling stake in JSC "Bellakt".
The "Biokom" also reported that the enterprise considers possibility of increase in the share in "Bellakt". In the company explained that the asset is interesting to "Biokom" in connection with plans for production of proteinaceous products on the basis of serum.
Consumer price index % y/y period average 7.0 8.4 14.8 13.0 7.7 52.3 67.5 18.5 Consumer price index % y/y eop 6.6 12.1 13.3 10.1 9.9 108.7 21.8 16.5 price index of producers of an industrial output % y/y period average
8.3 16.3 14.8 15.0 13.5 69.2 90.5 14.0
price index of producers of an industrial output % y/y eop
9.0 22.2 15.4 11.3 18.9 149.6 21.0 10.7
export of goods and services (USD) % y/y 22.3 24.2 34.2 -32.9 20.3 54.2 11.4 -15.5 Import of goods and services (USD) % y/y 33.2 28.0 37.0 -27.0 22.8 29.3 2.5 -6.7
Current account USD mln -1448 -3040 -4988 -6178 -8278 -5775 -1688 -- Current account* % GDP -3.9 -6.7 -8.2 -12.6 -15.0 -12.2 -2.7 -- direct foreign investments (pure) USD mln 351 1790 2150 1782 1352 3928 1308 -- International reserves USD mln eop 1383 4182 3061 5653 5031 7916 8095 6651 Balance of the state budget % GDP 1.4 0.4 1.4 -0.7 -2.6 2.4 0.5 0.2 Internal public debt % GDP eop 6.5 6.3 6.6 5.7 5.6 11.8 9.3 10.7 Gross external debt* % GDP eop 18.5 27.6 24.9 44.8 51.6 71.9 53.5 -- Monetary base % y/y eop 20 38 12 -12 50 84 62 13,4
Exchange rate (NBB, official)** BYR/USD period average
Source: research centre of Institute of applied mathematics
* - indicators are calculated on the basis of market exchange rates (an assessment of an average annual market rate in 2011 – 5984 USD/BYR). ** - In April-October, 2011 plurality of exchange rates took place.
Limit ceiling selling prices in rubles for a packaging unit of weight
Cow's milk pasteurized without flavoring additives and fillers in plastic bags (1 liter) fat content:
3.50% 5007 2.50% 4024 1.50% 3075
Kefir from cow's milk without flavoring additives and fillers in plastic bags (1kg) fat content:
3.50% 5051
3.20% 4845
2.50% 4112
1.50% 3189
0% 2810
Sour cream weight without flavoring additives and fillers (1кg) fat content:
25% 20091
20% 16086
15% 12352
Cottage cheese weight without flavoring additives and fillers (1кg) fat content:
9% 20941
5% 18695
0% 16232
Source: The annex 2 to the resolution of the Ministry of Economics of Republic of Belarus of 26.04.2012 No. 35 (in an edition of the resolution 14.02.2014 No. 10)
Limit ceiling selling prices of dairy products
2005 2006 2007 2008 2009 2010 2011 2012 2013
Export 474 583 872 1051 945 1500 1620 1852 2294
Import 17 29.1 35.9 40.9 35.1 45.4 37 40.5 76.6
Source: Comtrade
Export/import of dairy products, mln USD
Capacity, thsd tons Specific consumption (kg a year)
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