The import of drinking milk increased by as much as 60 percent last year compared to the previous year, while the total import of dairy products rose by 30 percent. This is a consequence, claims the director of the association Croatiastočar Branko Bobetić, of up to 20 percent higher purchase prices for EU quality raw milk in Croatia compared to EU countries and countries in the region.
The drop in purchases almost mirrored the drop in production for most of 2008. The reason for the decline in purchases is not the more expensive raw materials, but the drought in 2007, which increased the cost of animal feed. As a result, farmers generally bought less of it, leading to cows producing less raw milk. Despite this, Vindija purchased 3.9 percent more milk last year, while Dukat increased its purchase of EU quality milk by 13 percent.
Croatian dairy farmers have thus become uncompetitive compared to their colleagues from other countries. The reason for this is the increase in the purchase price of raw milk by 22.9 percent in the second half of 2008 when the Croatian government adopted the Regulation on Amendments and Supplements to the Regulation on the Target Price of Fresh Raw Milk. In Vindija and Dukat, they say that they warned the Ministry of Agriculture about the weak competitiveness of domestic dairies and appealed for the establishment of market prices.
– At the same time, the European Commission introduced export subsidies for drinking milk and dairy products, which further reduced the competitiveness of the domestic dairy industry – says Elena Wolsperger from Dukat.
If a market price for fresh raw milk is not established, Bobetić claims that the existence of the domestic dairy industry will be threatened, as a further decline in the price of raw milk is expected in the EU in 2009. However, Davor Sabo, director of the Livestock sector at Vupik, which has 1,000 cows, believes that this cannot be implemented unilaterally. – This suits us, and before any potential easing or abolishment of the Regulation, we would need to see the prices of animal feed and other input costs, which vary every year – says Sabo. He believes that abolishing the Regulation would put Croatian farmers in a very unfavorable position, reminding that even during times of cheap raw milk, domestic dairies had such prices for drinking milk and dairy products.
