Baltic producers threaten Finnish industry, say Finnish milk makers

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Last year operations ceased on 500 domestic dairy farms in Finland, and competition from Baltic milk producers is partially to blame, reported Finland's national broadcaster YLE Sunday.

Finnish dairy farms are in dire straits due to the rapid growth of Baltic milk production and the importing of foreign cow's milk, writes YLE. 

The Pellervo service organisation for Finnish cooperatives estimates that even harder times are ahead. The booming growth of dairy production in Estonia, Latvia and Lithuania is the newest serious competitor to Finland's milk industry.

Last year operations ceased on 500 domestic dairy farms. "At the same time, the average size of farms has grown and cow's milk production has stayed fairly stable for now," Lauri Vuori, a representative of Pellervo, told YLE.

"We have an overproduction problem and producer prices are low, and on top of that the Baltics are pushing milk into the markets at an accelerating rate," said Vuori.

The Finnish dairy industry has been shaken as in spring 2015 the EU abandoned its milk market production quotas and also due to the 2014 milk imports ban by Russia. YLE reports Finnish milk producers' income to have plummeted by 40% since last year. 

A total of 135 milk farms were closed in Latvia last year. After the Russian import ban Latvian milk producers say milk purchase prices have plummeted, from €317 for a ton of milk to €182 for a ton of milk, according to data by the Central Statistical Bureau.

However milk production has not declined as steeply with 72,775 tons of milk bought from milk producers in Latvia in May 2016, which is slightly above the 2015 figure of 71,504 and the May 2014 figure of 71,881.

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