Belarus will not cover Russian demand for dairy products for 100%

21 october 2014 | Nezavisimaya Gazeta

New agency, Federal Dairy Products Administration, should be set up to stop decline in production of milk. This idea was introduced by economists of the Russian Presidential Academy of National Economy and Public Administration (RANEPA). Dairy products branch is the most unsettling, as it has been an agribusiness industry underachiever for 20 years. State polices, focused on recovery of dairy products branch, demonstrate critical eye of Moscow on division of labor in the Eurasian Economic Union (EEU).

Elena Razumova
Elena Razumova
Department for Expert Analytics

Russian civil servants' persistence on recovery of dairy products branch testifies to Russian negative attitude towards division of labor within the Eurasian Customs Union and the Eurasian Economic Union, considers “Nezavisimaya Gazeta”. Instead of using Belarusian production of milk, Russia spends money on recovery of Russian milk production, success of which is unobvious.

“Distrust in  integration associations scarcely is the issue”, commented this situation the expert of the Analytical Center Elena Razumova. “Belarus will not cover our demand for dairy products for 100%, because our market is too big, and their production capabilities are close to maximum. Moreover, Belarusian milk delivery transport leg to e.g. Far East is too expensive. Deliveries from Kazakhstan are available only in the nearest regions of Russia. For other territories local manufactures are more profitable, regardless of expenses’ difference. Furthermore, total dependency on the exclusive supplier can be dangerous. “Prices on Belarusian powder milk are well above e.g. New Zealand ones, as demand grew higher and number of suppliers reduced. In August –September, 2014 growth of prices on Belarusian powder milk accounted for 24%, on powder milk from Switzerland – 19%”, said Ms. Razumova.