Are milk purchase prices stable in Lithuania?

European Commission data shows that the average farm-gate milk price in Lithuania has been falling for 5 consecutive months. Among the 27 countries of the European Union, our country now ranks 22nd. However, the interlocutors interviewed by „Agrobite.lt“ Renata Vilimienė, Head of the Association of Lithuanian Medium Dairy Farms, Oksana Puronaitė, Head of the Agricultural Company „Berčiūnai“ and Aiste Sabaliauskaitė, Head of the Administration of the Agricultural Cooperative „Lietuviškas pienas“ were surprised by such statistics. Why?

Both happy and afraid

„Farmers in Kupiškis district who have cooperated to sell their milk to ŽŪKB „Pieno gėlė“ have not noticed the price hike. The same prices have been maintained for some time and not a single penny has gone up or down," says Renata Vilimienė, head of the Lithuanian Association of Medium Dairy Farms (LVPŪA). This is why, she says, farmers are quietly happy, but also scared, because they believe this cannot go on for long.

„I hear farmers saying that prices are currently at a level where they can even pay their taxes and bills every month. If these prices continue, there may be no need for payments to cover the debts," continues the head of the LVPŪA.

Farmers are usually forced to use their payments to cover the debts they have accumulated over the years as soon as they receive them.

„Nobody believes that prices will stay that way for long. But this stability is keeping medium-sized dairy farms from disappearing for now. Many thought of retreating, of selling their farms, but this stability has kept them from doing so," Vilimienė notes, adding that a fall in prices would cause intense despair as everything around them becomes more expensive.

Dairy farming – a business?

„We have not felt the price drop because we have changed the buyer of milk – we have gone from ŽŪK „Pienas.lt“ directly to the market. Therefore, I would not say that the price is falling. Of course, it has gone down in general, but very slightly," says Oksana Puronaitė, the manager of the Agricultural Company „Berčiūnai“, about the situation.

She also believes that the fall in prices is a kind of manipulation of the situation.

„Everybody seems to be saying that milk prices are going to fall, so the impression is that action is needed to justify these words. So if you can take advantage of that, you can bring those prices down. But in reality, the price is quite stable," Puronaitė notes, adding that the surrounding markets are not showing any drop, especially in dairy consumption.

On the contrary, – its prices are consistently rising. Therefore, the drop in milk purchase prices may be an artificial process, according to the head of ŽŪB „Berčiūnai“.

„We very much hope that the price of milk on the market will not decrease. But even if it does not increase, it is not disastrous. At least for a competitive farm that has invested, can retain staff and produce quality raw milk. What's more, if prices remain stable, dairy farming could be called a business," says O. Puronaitė.

Stability with a touch of tension

„In our cooperative, we don't feel the price drop. We live with the same price almost all year round. So our farmers are stable," Aistė Sabaliauskaitė, Head of Administration of the Agricultural Cooperative „Lietuviškas pienas“, echoes the other speakers.

However, the woman is frank: "Dairy farming is probably the only branch of agriculture where you never know what the future holds when you sell a product. Dairy farmers are always in a constant state of tension because they never know what the next month will bring.

The best thing that can happen at the moment, according to Ms Sabaliauskaitė, is price stability.

„Of course, we are all human beings and we always want to get more for our hard work. The amount of work farmers put in over a week, over a year, when they have few days off, does not make that milk seem so expensive or properly valued. We always want to get more for it," says the CEO of ŽŪK „Lietuviškas pienas“.