Since the signing of the food prices memorandum in May last year, the share of locally produced milk in stores has not changed significantly, said Janis Sholks, chairman of the board of the Central Union of Latvian Dairy Farmers.
He noted that Latvian retailers import milk and dairy products in significant volumes, which is a serious problem for the dairy industry in Latvia.
According to Sholks, in Estonia, the share of local milk in stores is about 90%, while in Latvia it is approximately 50%, which he considers an abnormal situation. He added that he does not know of any other European country with a similar situation.
He also noted that in certain product categories, there has been a slight increase in favor of Latvian products after the signing of the memorandum, but it is very insignificant. At the same time, the sales volume of fresh milk of Latvian origin has hardly changed, and sales of Latvian cheese have even decreased.
Sholks emphasized that more was expected from the memorandum signed last May, but it did not bring about significant changes.
According to him, it is still unclear how much the rise in energy resource prices will impact the industry. The influence of rising energy costs on milk production and especially its processing is already noticeable. He explained that milk processing is an energy-intensive process since milk needs to be both heated and cooled.
Moreover, the industry will be affected by the rise in fuel prices, which will particularly increase costs for milk delivery, raw material transportation, and logistics of finished products.
Sholks also noted that although the purchase price of milk is currently lower than it was a few months ago, the decrease is happening slowly and insignificantly. In February, the purchase price of raw milk was 42.08 euros, while a few months ago it was close to 50 euros. The dairy union feared that the price might fall below 40 euros, but that did not happen.
He stated that there are now signs that the price of milk may rise again, but price fluctuations will not be sharp.
In response to a question about whether the bankruptcy of the Estonian processor “E-Piim Tootmine” affects the Latvian raw milk market, Sholks said that the impact is negligible since Latvian enterprises supplied relatively small volumes of milk there, and many producers have already found other buyers.
He noted that about 2,500 tons of raw milk are produced daily in Latvia, while only a few hundred tons were exported to “E-Piim Tootmine.”
Sholks also reported that last year, Latvian dairy producers exported goods worth about 300 million euros to 72 countries worldwide, which is the largest export volume to date. Meanwhile, in the domestic market, he said, "no miracles are happening," and there are currently no clear signs of growth.
It should be noted that in May 2025, a memorandum was signed to reduce food prices. It was signed by the Minister of Economics, the Latvian Food Traders Association, the Latvian Chamber of Commerce and Industry, the Central Union of Latvian Dairy Farmers, the Latvian Food Industry Federation, the Council for Cooperation of Agricultural Organizations, the “Zemnieku saeima” association, and other partners.
The memorandum provides for the introduction of a basket of low-priced products, the creation of a price comparison tool, and an increase in the share of locally produced products in stores.
