Only since 2016 has Ukraine begun to increase its exports of milk and dairy products to the EU. Previously, the primary market was the CIS countries.

At the same time, in 2022, with the start of a full-scale war, domestic milk supplies increased tenfold. Currently, the business is forming a large-scale document, the Roadmap for European Integration of the Dairy Industry.

Between 2011 and 2015, Ukraine almost did not export dairy products to the European Union. Then the main markets were Moldova, Kazakhstan, Turkmenistan and other CIS countries.

Only since 2016 has Ukraine begun increasing its exports of milk and dairy products to the EU. In the year the Association Agreement between Ukraine and the European Union came into force – 2017 – the volume of exports of our products to the European market increased by as much as 7 times, reaching 3.5 thousand tons; the following year, this figure had already risen to 6.6 thousand tons.

However, until the beginning of 2022, the share of Ukrainian milk exports to Europe remained relatively insignificant, reaching a maximum value of 5.1% in 2019.

Following the full-scale invasion of Ukraine by the Russian Federation, the European Union adopted a decision to temporarily liberalise trade with our country, allowing the export of dairy products without tariff quotas or other trade restrictions.

In the same year, exports to the EU soared almost tenfold to 23.5 thousand tons, accounting for nearly 24% of Ukraine’s total exports. The duty-free trade regime was extended, and it will now remain in effect until June 2025.

Most of all, in the year of the first great war, Ukraine exported powdered milk, butter and cheese products.

Already in 2023, dairy exports declined. Total deliveries decreased by 6.5%, and deliveries to EU countries decreased by 30%. The main reasons for this were the shortage of raw materials on the domestic market, increased consumer demand, logistical problems, and the gradual alignment of raw materials with European standards.

As of 2024, 58 domestic producers of raw milk, ice cream, dairy products, and whey had permits to export milk to the EU. Ukraine supplied 30% of exported dairy products to the European Union. The primary consumers of Ukrainian dairy products among EU countries are Poland, Bulgaria and the Baltic countries.

In 2022, Ukraine received candidate status for EU membership. This means that the integration of the Ukrainian market into the European one is inevitable. But before that, Ukraine has a long way to go to harmonise its legislation and raise production to European levels.

Last spring, the Union of Dairy Enterprises of Ukraine signed a Memorandum of Understanding with the European Dairy Association (EDA). At the same time, the EDA announced the creation of the Committee on European Integration of the Dairy Industry, which brought together business representatives (processors and producers), as well as government and European partners.

The Committee’s main project is the Roadmap for the European Integration of the Ukrainian Dairy Sector. This is a large-scale industry instruction on the path to a common market and EU membership. The preparation of the document is already underway. It has undergone seven stages: a general start of work, preparation of the first version of the map, an in-depth industry analysis conducted by 11 expert subgroups, relevant consultations, preparation of the final version of the map, and an information campaign/work with businesses.

Each subgroup is working on a separate area of legislative integration: food safety, product traceability and identification, animal health and welfare, feeding and feed, environmental aspects, etc.

The final version of the roadmap should be ready by this year.

First expert meetings

A few days ago, on February 27, an introductory meeting on the development of the Roadmap was held. Experts from various industries attended the meeting, including representatives of dairy associations, ministries of agrarian policy and economy, the State Service for Food and Consumer Protection, and international partners from the EU and Switzerland.

According to the coordinator of the European Integration Committee, Elizaveta Svyatkivska, the European participants unanimously confirmed their readiness to support Ukrainian dairy farmers on the path to the common market.

Also, Laurens van Delft, EDA’s Director of Trade and Economics, emphasised that the Ukrainian dairy industry has already proven it has entered the European dairy market and reaffirmed his commitment to supporting Ukraine on its path to integration.

“The stage of forming working groups and defining key tasks has now been completed. Experts are actively working on developing materials for the Roadmap. In the future, internal consultations, information collection and analysis, and the development of specific measures to achieve integration goals are planned.

During the meeting, we received a practical tool – technical instructions for experts provided during the meeting demonstrate readiness for specific actions and practical work on the document,” commented Svyatkivska.

She added that the meeting participants took the first step towards developing a vision for the Roadmap, which should serve as a guide for Ukrainian dairy farmers on the path to European integration.

What problems does the dairy business face in exporting products to Europe

Representatives of the dairy business admit they face problems and obstacles to entering and expanding their presence on the EU market. In particular, they spoke about them during a survey conducted by the State Research Institute of Informatisation and Economic Modelling together with the NGO “Centre for Market Economy Development “CMD-Ukraine”:

• insufficient support from the state. Dairy enterprises need state support programs to modernise production, introduce new technologies and increase energy efficiency;
• investment climate. Insufficiently favourable conditions for attracting investments in the dairy industry, in particular due to the lack of transparent and understandable legislation and long-term work rules;
• insufficient cooperation with the European Union. Ukraine should participate more actively in EU programs supporting the development of agriculture and the food industry, and should also cooperate more closely with European experts to exchange experience and receive advice.
• EU quotas and precautionary measures. The introduction of quotas for the import of Ukrainian dairy products is unjustified and limits the potential of Ukrainian producers. This contradicts the principles of free trade and negatively affects the trade balance, since the EU exports more dairy products to Ukraine than it imports.

According to dairy enterprises, to improve export conditions and presence on the European market, the Ukrainian government should first harmonise legislation in the fields of food safety, veterinary medicine, and ecology with EU requirements. This will ensure transparency and efficiency of quality control systems.

At the same time, the investment climate to attract European investors can be improved by simplifying regulatory frameworks and guaranteeing stable investment conditions.

In general, participants in the dairy business are convinced that the integration of the Ukrainian industry into the EU will have a positive effect on everyone. In particular, increasing exports of Ukrainian products to world markets will create new jobs both in Ukraine and in the EU. In addition, this will increase the economic opportunities of both sides through the development of the dairy industry and related production chains.

biz.censor.net, Yulia Daletska