Trade in dairy products between Belarus and Ukraine has not been affected - Maxim Fasteev

He noted that the Union of Dairy Enterprises of Ukraine has had the idea of restricting imports from the Republic of Belarus for several months and at the last open press conference this statement was made in plain text.

‘The good goal of protecting Ukrainian producers from subsidized Belarusian products (the same statements have been made in the direction of import restrictions from the EU for the last year) is logical if you look at the dynamics of supplies in volume and money. But the complete closure of the import of products is at least controversial due to the change in the Ukrainian balance – a decrease in domestic supply and an increase in demand,’ Maxim Fasteev wrote.

He also studied the volume of imports in money in the context of finished products ("fresh" category, cheeses, condensed milk) and exchange-traded goods (butter, whey powder, skimmed milk powder) and found that for 5 months of this year, compared to the same period last year, there is an increase in the finished products and a significant jump in exchange-traded positions.

‘What does this mean and why did this happen? Belarusian operators have indeed been working in recent years to increase the share of their finished products on the Ukrainian market, and this is a normal and logical process on their part, taking into account the changes in milk balances in Ukraine and the Russian Federation. Of course, the volumes are not the same as they were in 2011-2012, but the growth has been stable for the last 3-4 years,’ Maxim Fasteev added.

According to him, at the same time, trading in exchange-traded goods to Ukraine is not a priority for them, and there is already a direct interest of Ukrainian operators here. However, it depends purely on the actual price – last year, for example, European goods were much more interesting than the ones from Belarus, this year - on the contrary. For Ukrainian operators, this is an additional option to cover their demand for raw materials and, taking into account the change in the balance, to constrain inflation both in the raw materials market and selling prices in general.

In addition, Maxim Fasteev said that last week President of Belarus Alexander Lukashenko announced the "closure of the border with Ukraine".

‘It has not been possible yet to find out what was specifically meant, but, according to market reviews, this week dairy products planned for shipment were delivered / are being delivered to Ukraine. The problem of "closing the border" for the Belarusian side may also be logistical risks – the main port for exporting meat and dairy products to China and Southeast Asia in 2021 is Odessa, not Klaipeda,’ wrote the expert of Infagro.

In conclusion, he noted that the general risks of restrictions appeared last autumn due to the political factor. First of all, these risks concerned Belarusian exporters of finished products and traders who imported exchange-traded positions to Ukraine, and it should be recognized that both sides took them into account (several investment projects were frozen, a more careful attitude to prepayment, etc.).

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