The share of locally produced milk in stores in Latvia has not significantly increased since the signing of the food price memorandum last May, according to Janis Solks, chairman of the board of the Latvian Central Union of Dairy Farmers.
Solks stated that Latvian retailers continued to import large amounts of milk and dairy products, which he described as a major problem for the country’s dairy industry.
He noted that in Estonia, locally produced milk accounted for about 90% of milk sold in stores, whereas in Latvia the share was roughly 50%, which he considered abnormal. According to Solks, he is not aware of any other European country with a similar situation.
Solks acknowledged that in some product categories there had been a small increase in the share of Latvian products since the memorandum was signed, but the change had been minimal. At the same time, the sales volume of locally produced fresh milk has remained virtually unchanged, while the sales of locally produced cheese have even declined.
He stressed that the dairy sector had expected greater results from the memorandum signed in May last year, but so far it had not led to significant changes.
Solks said it was still unclear how strongly rising energy costs would affect the dairy sector. However, the impact is already visible in milk production and especially in milk processing, which is relatively energy-intensive because milk must be both heated and cooled during processing.
The sector is also expected to feel the impact of higher fuel prices, which will increase costs for milk collection, raw material transport and the logistics of finished dairy products.
Although the raw milk purchase price has declined compared with a few months ago, the decrease has been relatively slow and modest. In February, the purchase price of fresh milk was 42.08 euros per kilogram, compared with nearly 50 euros per kilogram a few months earlier.
There had been concerns within the dairy farmers’ association that prices might fall below 40 euros, but this did not occur. Solks added that there were now signs that milk prices could start rising again, although fluctuations were expected to remain moderate.
When asked whether the bankruptcy of the Estonian dairy processor E-Piim Tootmine had affected Latvia’s fresh milk market, Solks said the impact had been limited. Latvian companies supplied the processor with relatively small volumes of milk, and most producers had already found alternative buyers.
Latvia’s daily fresh milk turnover averages around 2,500 tons, while only a few hundred tons were exported to E-Piim Tootmine.
Solks also noted that Latvian dairy product manufacturers exported goods worth 300 million euros to 72 countries last year, representing the largest export volume of dairy products to date.
However, he added that in the domestic market “no miracles are happening”, and there were currently no clear signs of growth.
The food price memorandum, signed in May 2025, involved the Ministry of Economics of Latvia, the Latvian Food Traders Association, the Latvian Chamber of Commerce and Industry, the Latvian Central Union of Dairy Farmers, the Latvian Federation of Food Companies, the Cooperation Council of Agricultural Organisations, the farmers’ organisation Zemnieku saeima and other partners.
The agreement aims to introduce a low-price food basket, create price comparison tools, and increase the share of locally produced food in Latvian retail stores. (BNN)