Ukraine:Improving Milk Supply in Northern UkraineUkraine:Improving Milk Supply in Northern Ukraine

Despite suffering two decades of decline in production, Ukraine is still a net exporter of milk and dairy products. Private household farms account for the majority of total milk production (around 81% in 2006) but milk quality and supply are major concerns and have been recognized as impediments to the development of the country’s dairy industry. The quality of milk from rural households is generally lower due to poor milking and milk handling systems. As both export and domestic markets become more demanding, raising the average milk production per cow and quality standards produced by household farms is critical.

In 2007, CJSC Shostka, a major Ukrainian cheese producer, received financing and acquisition of equity from the EBRD in order to expand its cheese production capacity and enhance its related infrastructure through improved backward linkages with the local farming community. Currently, the company purchases 40 percent of its milk supplies from small household farms through 42 milk collecting stations across 22 communities. The company’s aim is to lift the average milk production per cow as well as the quality of milk.

To improve the procurement of milk in the northern region of Ukraine, EBRD called upon the technical expertise of FAO to conduct a milk sector analysis and improve Shostka’s milk procurement systems in northern Ukraine through rural household dairy farmer training. The training addressed animal nutrition, dairy cattle management, sanitary issues, milk quality, logistics and the overall milk collection process. The team carried out an analysis of the dairy sector in Ukraine to identify its constraints and opportunities, which resulted in a report, and to initiate policy discussions with a wider group of stakeholders in the public and private sectors.

The assignment consisted of three phases:
Phase 1: Feasibility studyThe study covered: a.Private household farms, b. Possible models for consolidation of dairy farm activities (feed procurement, milk hygiene, milking, cooling etc.) c. A detailed description of the models proposed, d. Models for financing key investments for agricultural enterprises (cooling tanks, milking parlors, farm buildings etc.) e. Technical assistance required by agricultural enterprises to prepare loan applications.
Phase 2: Implementation of the PilotsPilot projects were proposed for four communities and involved regional farming entities in each area. Based on the feasibility study, pilots were implemented through technical assistance which consisted of (i) a team of dairy experts; and (ii) three training workshops in the region on selected technical areas
Phase 3: Dissemination of Results and Recommendations for Up-Scalingthe outcome of the pilots was assessed and its results disseminated to the various dairy processors and made recommendations for up-scaling. Dissemination of the results were in the form of: (i) individual meetings with main milk buyers in the region; (ii) technical leaflets in Ukrainian tailored to dairy farmers; (iii) one general workshop targeting regional dairy plants, extensionists and other key stakeholders.

Following this sector analysis and the farmer training, the FAO Investment Centre organized a roundtable with representatives of the Ministry of Agrarian Policy and Food of Ukraine (MAPFU), producer and processor organizations, major market players and industry experts to test interest in a public-private dialogue platform. As a result, a Working Group of Ukrainian dairy farmers and stakeholders was formulated and met for the first time in June 2013. The Working Group, supported by FAO and EBRD, will be instrumental in improving policy dialogue between the public and private sectors to improve effectiveness and transparency of national dairy sector policy.

(i) Related meetings
document title
Assistance to Dairy Farmers in Northern Ukraine, June 2011 view
Trends in Ukrainian dairy market, November 2011 view
(ii) Related news
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EBRD and FAO pledge support to Ukrainian dairy sector, April 2013 view
New publication analyzes milk production trends in Northern Ukraine view
(iii) Useful resources and websites
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Agrarian Markets Development Institute (AMDI) view
Agribusiness Handbook: Milk / Dairy Products, 2009 view
APK Inform view
(iv) Dairy models
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Dairy models download

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Meetings & Workshops

07 May, 2022

Regional: Monitoring the Adoption of Key Sustainable Climate Technologies in the Agri-food Sector
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12 December, 2021

Ukraine: African Swine Fever – Risk awareness-raising and risk mitigation
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08 March, 2018

Montenegro: Upgrading Meat Quality Standards
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09 January, 2018

Georgia: Support to Sustainable Value Chains through the Development of Geographical Indications in the Dairy Sector
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14 December, 2017

Regional: Supporting Public and Private Sector Capacities in Sustainable Agricultural and Bioenergy Investments
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13 November, 2017

Serbia: Improving Food Quality and Safety in the Meat Sector
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04 September, 2017

Enhancing Grain Market Transparency in Kazakhstan
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13 March, 2017

Turkey: Study tour to France on Geographical Indications
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EastAgri is supported by FAO, EBRD, and The World Bank