Milk overproduction forces prices down

The prices paid by milk industry players to collect milk from producers have fallen sharply over the last four weeks, by as much 20%. Some blame overproduction, while others say the decline is the result of a policy to discourage milk production. “This is a harsh price policy. Every major group has pushed their prices down by up to 20%, which is causing other players to do the same,” says Raul Ciurtin, chairman and shareholder of Albalact Alba Iulia, a medium-sized player on the market and the owner of the Fulga brand. Players who manage to obtain lower purchase prices are increasing the pressure on the market because they transfer the price cut to their sale prices. Gheorghe Balan, general manager of Covalact, says the Romanian market for dairy products is very weak in terms of product diversity and processors avoid buying large amounts of milk. ZF