Ukrainian Cheese Producers Forced to Reduce Output Due to Rising Imports

A significant increase in imports of European cheeses, combined with the seasonal decline in consumer demand, has intensified competition and is forcing domestic producers to reduce production volumes, according to Infagro.

«During the first half of the year, imports of hard and semi-hard cheeses increased by 27% compared with the same period last year. As a result, imported products now account for more than one-third of sales in this segment. Imports of white cheeses also increased by 15%, and in some product categories they already represent around half of the market. The smallest increase was recorded in the processed cheese segment,» the analysts said.

Market participants identify the price gap as the main driver behind rising imports. European cheeses remain less expensive than their Ukrainian counterparts, forcing domestic producers to rely heavily on promotional discounts, which often erode profit margins.

Although export prices for Ukrainian cheeses may be more attractive than domestic prices, only a limited number of companies have been able to significantly expand their exports, the experts noted. During the first half of the year, exports of semi-hard cheeses declined by 15%, while export volumes are now three times lower than imports.

At the same time, the cheese products segment continues to show positive momentum. Exports of cheese products increased by 15% during the first half of the year, while exports of processed cheese products declined by nearly one-fifth.

Market experts note that without expanding export opportunities and improving the competitiveness of domestic producers, it will become increasingly difficult for Ukrainian cheesemakers to compete with lower-priced European products both on the domestic market and internationally.