Milk processing in Ukraine becomes profitable from about 150 t/day, compared with 500 t/day in Europe — opinion

The profitability threshold for milk processing in Ukraine starts at around 150 tons per day, while in Europe the figure is significantly higher — about 500 tons per day, according to Yaroslav Nitsak, CEO of GEA Ukraine.

According to him, some milk producers are considering installing equipment for their own processing, but the key factor is the volume of raw milk available.

“A large farm may produce 30–50 tons of milk per day, but milk processing becomes profitable in Ukraine at roughly 150 t/day, while in Europe it starts from about 500 t/day,” Nitsak said.

The expert explained that much depends on herd productivity. To illustrate the scale, he cited the example of the largest dairy holdings in Ukraine, where daily milk production reaches approximately 160–220 tons.

Even at such volumes, however, processing does not make economic sense for every producer.

“Processing 150 tons of milk per day remains profitable for an existing plant that produces fresh dairy products, has a recognizable brand, and a loyal consumer base,” he explained.

At the same time, the market for fresh dairy products in Ukraine is currently highly competitive and low-margin, making it difficult for new players to enter.

According to Nitsak, in such conditions, producers may choose between two directions: craft dairy products or commodity dairy products such as milk powder, casein, butter, or milk fat. However, in this segment economies of scale play a decisive role.

“For these products, profitability starts at processing 400–500 tons of milk per day,” Nitsak added.