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Vadim Chagarovskyy: “We should learn to abide by the rules”

Vadim Chaharovskyi, Chairman of the Directors Board of Dairy Enterprises Union of Ukraine.

Chaharovskyi Vadim Petrovych, a graduate from Odessa Technological Institute of Food Industry University named afterM.V. Lomonosov, PhD.

From 1986 to 1992 he worked as an assistant professor of dairy technology and food drying in Odessa Technological Institute of Food Industry. In 1992 he was appointed as a deputy director of production and raw materials of the Ukrainian-Italian joint venture Odytalat.

He was the director of Balta dairy products plant for children, technical manager of Parmalat Ukraine. Since 1998, he managed Galakton, dairy plant.

In 2006, he headed the construction of Bilotserkivskyi milk processing plant. Nowadays Vadim Petrovych is a Vice-president of a managing company Terra Food. Since 2010, he is a Member of the Supervisory Board.

Since 2004, he has been the Chairman of Union of Dairy Enterprises of Ukraine. Awarded with the Diploma of Honour by the Cabinet of Ministers of Ukraine, Diploma of “Man of the Year — 2002” in nomination “Manager of the Year”, Diploma of the Verkhovna Rada of Ukraine for special merits. He has the title “Honored Worker of Industry of Ukraine”.

Vadym Petrovych, how would you characterize the current state of dairy industry in Ukraine?

Unfortunately, in 2010, the total production of milk, compared with 2009, decreased. The volume of processed milk declined as well. We cannot say that the situation in the dairy industry is satisfactory at least. It is rather unsatisfactory. It is difficult.

What is the reason for that? Since all of us work under market economy conditions, we are to use market terms. Let us analyze the market and purchasing power. Today, for example, the purchasing power of Ukrainian consumers is lower than it was in 2009. Prices for dairy products in Ukraine now is absolutely the same as in Europe. These two reasons — low purchasing power and high prices — are interrelated, so it is understandable why consumption has decreased.

What causes the high prices? Firstly, the crisis on commodity market. Since 1990, our livestock is steadily decreasing in the country, and in recent years, unfortunately, we failed to suspend the process.

To change the situation on the milk market, we must, first of all, change it on the market of raw milk.

I would also note the following. Today the dairy industry in Ukraine has limited access to foreign markets. There are, for example, certain restrictions as to market entry of the Russian Federation, but everyone understands that the main foreign markets for Ukraine now are the CIS markets. In Europe, no one wants us.

Therefore, in my opinion, we should think about following. Firstly, it’s the development and content of our domestic market. Secondly, we need to develop exports to the CIS.

Summarizing comments on the current state of the industry, I can say that the last two years, the industry is experiencing stagnation. It’s not decrease, it’s stagnation.

See full version in Milk and Farm Journal, № 3, December, 2010.

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