Головна сторінка
/
Новини
/

Milkiland increases milk supplies from cooperatives to 15% of supplies

Milkiland increases milk supplies from cooperatives to 15% of supplies

7 October 2011

Milkiland (WSE: MLK PW, BUY) increased its milk procurement from cooperatives to 15% of its total supplies as of October 1 from 10% at the end of the second quarter, the company reported on its website yesterday. As of 2010, Milkiland received 54% of its milk from farms and 46% from households, vs. 19% and 81% on average for Ukraine. Yegor Samusenko: The key benefit of milk from cooperatives is a lower price, with a higher quality of the milk a secondary but longer-term reason. A cooperative unites cows from households (avg. of 1.2 cows per household) and applies for a government subsidy equivalent to 20% VAT, which household cannot apply for as paper work costs exceed the potential benefits for individual farms. Cooperatives stimulate households to contribute their cows by offering a 5% milk price premium. Though the material effect of the 5 pp increase in milk supplies from cooperatives is rather negligible for Milkiland, we note the success of the initiative is a long-term positive for the company, as it could both ease cost pressure and secure a stable base of raw milk supply, which is crucial in the current Ukrainian market with raw milk output declining. For more about cost pressure facing Milkiland, please see our note dated September 28. 

Останні новини

News

23

02/2022

Separatists may claim entire territories of two Ukrainian regions

Russia has recognized “all fundamental documents” of the self-proclaimed Donetsk and Luhansk People’s Republics (DNR...

News

23

02/2022

U.K. to provide USD 500 mln loan guarantee for Ukraine as IMF mission starts

The British government is going to provide up to USD 500 mln in loan guarantees...

News

23

02/2022

MinFin bond auction receipts jump to UAH 3.5 bln

Ukraine’s Finance Ministry raised UAH 3.3 bln and EUR 7.2 mln (the total equivalent of...