As a result of the 1st half of 2012, exports of dairy products from Ukraine, in terms of value, decreased by $78.9 million or by 29% in comparison with the first half of 2011. In addition to the negative impact of the ban on imports of cheese imposed by the Russian Federation, the decrease in exports also took place due to a significant decrease in supply of butter, milk and dairy products - the Association "Ukrainian Agribusiness Club" (UCAB) says.

"Cheese War" with Russia affected the balance of foreign trade of the country and caused significant losses to dairy industry in Ukraine. According to the State Statistics Service, to Russia, in the first half of 2012, there was shipped 7.7 thousand tons of cheese less than the same period last year, resulting in losses amounting to $46.8 million. At the same time the exports of cheese to other countries, in terms of value, remain unchanged or even increased.

The director of UCAB agency AgriSurvey Taras Gagalyuk claims that the industry suffered losses not only due to decrease in exports of cheese. "In the first half of 2012 there were exported 20% less dry milk, 56% less milk and dairy products (milk, yogurt, sour cream, fermented baked milk, yogurt, cheese etc.) and up to 81% less butter. Total losses amounted to $78.9 million".

However, the most adverse effect on the dairy sector will be caused by the inability to export cheese, and the contradictory information about the losses of milk producers appears, from time to time, in the press. "According to our research "The biggest livestock holdings in Ukraine: dynamics of development", purchase prices for milk are best correlated with exports of cheese, not of butter or milk. And this is obvious, because cheese is the main export product of dairy industry in Ukraine. That is why special attention should be paid to the support of domestic producers on foreign markets,"- T. Gagalyuk said.

Information note: "Major livestock holdings in Ukraine: dynamics of development" - is an annual survey of the Association "Ukrainian Agribusiness Club," devoted to the analysis of structural changes and corporate management in meat and dairy industry. The study covers information on the top producers of milk, pork, cattle and poultry, the analysis of cost, marginality and profitability of livestock breeding with estimated break-even points, the technical efficiency and return of investment, the comparative analysis of expenses, as well as the analysis of macroeconomic issues, such the influence of Russia's WTO accession and VAT legislation on the development of meat and dairy industry in Ukraine and others.