The price of butter in Russia rose sharply

27.02.2017

Rising prices for butter manufacturers are concerned about ice cream, which sent an appeal to FAS.

 Ice cream manufacturers appealed to the Federal Antimonopoly service (FAS) in connection with the rise in the price of butter in the autumn of 2016, told RNS the General Director of the Union of ice cream producers of Russia Valery elhov, adding that the growth of prices on oil was discussed at the meeting in Antimonopoly service.

    "Since the early autumn a sudden spike in the price of butter. Increased cost 100 rubles, in some cases, for 200 rubles per kilogram, he said. — Such an abrupt situation led to the fact that the price of ice cream increased, consumption has decreased to some extent, increased the cost".

According to him, the cost of ice cream is growing by an average 10% annually, and when increasing the raw material price growth accelerated to 15%.

In connection with addresses of manufacturers, the Union of ice cream producers of Russia appealed to the FAS, but the Department stated that they see no grounds for proceedings for the cartel.

"We, the FAS consulted, we were told that the grounds for judicial proceedings concerning cartel agreements there — said elhaw, noting that a formal request to the FAS are not sent. — While on the other hand, how can we explain that once all oil producers increased the price? We raised this issue at the meeting in the face". From the point of view Elhova, a sharp increase in the cost of butter can not be explained by higher prices for milk because it was at the level of 2-3%.

The head of the Union of ice cream producers did not rule out that the increase in product prices linked to higher prices of imported products. "FAS have to deal with the trade act including where it is recorded that if price rose 30% within two months, the government can intervene in this situation, the limit price for the market", he concluded.

Elhov noted that a further price increase on butter or other necessary in the production of products such as powdered milk or sugar, will provoke the appreciation of ice cream and can lead to withdrawal from the market of several companies.

    "This deficit may not cause terms of volume - we'll find somewhere to buy, but it will cause higher prices, higher production costs and lower demand, he said. — If costs are rising and margins not be sufficient to compensate – of course, will be closed (shops – ed.)".

Elhov noted that in the Russian market there is a shortage of raw materials necessary for ice cream production, therefore it is necessary to buy abroad.

"For us, butter and dry milk is a strategic raw material. These products are in short supply, as all dairy products in Russia, its just not enough, so we are forced to buy it abroad, he said. — We have a shortage of these products, so foreign manufacturers, starting with Belarus and Ukraine will earn on the difference in prices".


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