BELARUS NEWS AND ANALYSIS

DATE:

04/12/2008

Belarus: Minselkhozprod Is Not Planning Price Increase for Animal Products till the End of the Year

Ministry of Agriculture and Food Supplies of Belarus is not planning to increase purchase prices for animal products till the end of the current year, as Tamara Vusko, the Head of the Chief Economics Department of Minselkhozprod, said to reporter of BELTA.

According to her words, the increase of procurement prices for animal products in the current year was caused by the necessity of cost compensation for its production, as well as by compensation of growth of prices for material resources and adjustment of prices for these products with neighboring countries. "We always monitor the level of purchase prices for raw materials in neighboring countries and practice price adjustment to protect the interests of domestic producers and avoid illegal runoff of finished products", - the official said.

At present, the situation has changed significantly due to the world financial crisis. Prices for fuel and mineral fertilizers have decreased. Food prices have started reducing as well. For example milk export prices have been down. Belarusian dairy products are becoming noncompetitive in the foreign market due to price factor. Thus, in September export prices for butter, hard cheese, full cream milk powder and skim milk powder were down by 16.1%, 23.8%, 28.6%, and 31.9% respectively to compare with January of the current year. The current level of export prices doesn't provide sales profitability of Belarusian producers.

Therefore, judging from the current price situation in the foreign market, procurement prices for agricultural products won't be up, as Minselkhozprod officials underline. Furthermore, procurement prices for cattle and pigs have been already increased four times this year: by 5% in February, by 10% in June for cattle, by 10% in July for cattle and pigs, and by 5-10% in average in September. Ceiling selling prices for animal products (beef and pork) were not growing very often: by 5% in October, by 4% in November. That afforded to compensate partially the level of costs for their production. All this time meat processing enterprises were financially responsible, and it had an impact on their financial state. Dairy enterprises receive no profit, and many of them work at a loss, because they manufacture socially important products.

The issue on possible decrease of purchase prices for animal products grows in importance, as processing industry is in danger. Such opinion was expressed by Semyon Shapiro, the Minister of Agriculture and Food Supply at the meeting of the Agency's collegiate organ.

Source:

http://meatrussia.com/news/read?nid=164581

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