Cheese production is a long process that depends not only on production capacity but also on the economic condition of the country and the market situation.
Recent years have been quite challenging for Ukraine’s dairy industry. Military actions, difficult economic situation, devaluation of the hryvnia, lack of working capital of enterprises – all this led to the fact that manufacturers did not have time to respond to the needs of the market.
Nevertheless, milk processing enterprises paid considerable attention to the development of sour-milk production, which was the most profitable.
The Ukrainian cheese market is one of the most dynamic segments with steady growth in production, consumption and international market coverage.
KOLORO branding agency will conduct market research, identify your target consumer and develop a unique packaging design for your product.
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General state of the Ukrainian dairy market
In Ukraine, cheese began to be created in the twentieth century. Now the production is carried out by more than 150 enterprises, 2/3 of them produce hard rennet cheeses, the rest – soft and processed cheeses. In 2017, 10.1 million tons of milk were produced by industrial and private farms. That’s a 2.9 percent decrease from 2016. They used 6%, about 606 thousand, to make cheese.
In January-October 2017-oyear produced 2.3 million tons of industrial milk, 1.8% more than in the same period of 2016. At the same time, the number of cows decreased by 1.9% and amounted to 2.1 million. Agricultural enterprises keep 474 thousand cows, while the remaining 1.636 million cows are kept by the population. The population decreased by 3.2% and 1.5%, respectively. Cheese production has decreased by 38% since 2013.
From July 2018, milk processors will only be able to buy raw materials from specialized farms. Such a provision is in line with the European Milk Quality Directive.
Read also: Analyzing the dairy market in Ukraine
Hard cheese market: largest producers
According to the results of 2017, the major players in the market are as follows:
- “TERRA FOOD.”
- LLC Trading House Western Dairy Group;
- “Dairy Alliance;
- “Milkiland.”
- “Club Cheese.”
- “Belle Shostka Ukraine.
TERRA FOOD
The TERRA FOOD group of companies unites several dairy and meat production plants, sugar factories, and breeding cattle farms. According to the company, it holds more than 16.5% of the market.
The company produces popular types of cheese under brand names:
- “The Golden Reserve;
- “Wapnyarka.”
- “Tulchinka.”
- “Sorochinsky.”
- “Farm.”
- { “laureate”.
Western Dairy Group Trading House LLC
Limited Liability Company Trading House Western Milk Group is a part of Continium Holding Company. “Western Dairy Group represents the interests of 10 dairies located across the country in the market. These dairies produce cheese under the KOMO corporate brand.
The brand’s assortment includes traditional hard and semi-hard, as well as original types:
- “Golder.”
- “Grande.”
- “Tenero.”
- “Country.”
- “Peanut.”
- “Pepenero.”
- “Holland.”
- “The Old Dutchman.”
- “Yogurt.”
- “Sour cream.”
- “Russian.”
and others.
Dairy Alliance
In 2016, 23,261 tons of cheese were produced at Dairy Alliance Group companies.
The alliance includes cheese brands Piryatin and Slavia. In the market, their products are of the following types:
- Cheddar;
- Parmenthal;
- Russian;
- Poshekhonsky;
- Dutch;
- Kostroma;
- Gouda.
The company also produces original species:
- “The Lions’.”
- “Grazia.”
- “Children’s.”
- “King Gourmet.”
- “King of Cheeses.”
and others.
KOLORO branding agency will conduct desk-based marketing research of the dairy products market, develop packaging design and create an advertising campaign.
Milkiland Ukraine
The company has united 10 milk processing plants, which produce products under the Dobryana, Kolyada and LatteR brands.
TM “Kolyada” presents on the market cheese products, processed cheese and processed cheese products.
“LatteR” is a young brand of the company, which appeared on the market of dairy products in Ukraine in 2015. Lutter cheese, which is lactose-free and gluten-free, is produced under the brand name.
“Dobryana is the flagship international cheese brand. Traditional soft, hard, and auteur types are produced under it:
- Aldermani;
- Cacciotto;
- Parmesan;
- Russian;
- Roquefort;
- Maazdam;
- Radomer;
- Camembert and others.
The Cheese Club
The company operates on the basis of the Kanevsky butter and cheese factory. In 2007-2008, the line was modernized, increasing production capacity.
The main product of the enterprise is cheese. The company also produces oil.
“Club Cheese produces predominantly original varieties;
- “Gronwald.”
- “Dijon.”
- “Ivanhoe.”
- “Pre-Carpathian.”
- “Neapolitan.”
- “Edelweiss.”
- “Noir.”
- “Crimean”
and others.
Belle Shostka Ukraine
The brand “Shostka” appeared on the Ukrainian market in 2005. Two years later, the mill was acquired by the French Bel group of companies specializing in cheese and derivative products.
“Shostka” is hard and processed cheeses of high quality. “Russian Classic” was tested by independent experts of European laboratories and according to the results of the analyses received the “Good Mark”.
The company owns cheese brands “Shostka” and “MiniBabybel”.
Advertising campaign from KOLORO branding agency increases sales of hard cheese by 1.5 times!
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World cheese production
Production is projected to reach 23.5 million tons by 2021 and the figure is expected to rise to 1 billion tons by 2030. At the end of 2016, the world produced 21.4 million tons of cheese.
The key producers in the world are the US and the EU. China plans to take some market share, but so far has only increased imports by 18%.
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Ukrainian cheese market: imports and exports
In the first six months of 2017, imports were up 41% year-on-year.
Traditional suppliers have not changed for several years. The leading 30% of the total amount of imported products remains Poland. Germany and France import less – 24% and 14% respectively. The remaining 32% are imported from Italy, Estonia, Latvia, Spain, Greece, Lithuania, the Netherlands and Switzerland.
“KOMO-Expert” for two years remains the leader in cheese exports to neighboring countries. At the end of 2017, Dairy Alliance made its first shipments of cheese to the UAE and the United States.
In 2017 Ukraine exported 11% more than in 2016.
Branding agency KOLORO will develop a dairy brand that will appeal to consumers in all countries of the world.
Ukrainian cheese market: consumer portrait
On average, Ukrainians consume about 4 kg of cheese per year. The most popular types have been Dutch and Russian for many years.
Ukrainian cheeses are not inferior in quality to the best European brands. The selling price for Ukrainian-made cheese is 170-180 UAH/kg, and imported cheese – from 180 UAH/kg.
The devaluation of the hryvnia and rising prices, including for cheese, influenced consumers’ choice: they reoriented to cheaper dairy products. Most consumers replace hard cheese with processed cheese, the range of which is constantly expanding.
A portrait of the hard cheese consumer:
- male or female;
- Age 23-25 years (the age when they start to become interested in nutritional quality);
- above average income (due to the high cost of goods);
- the purchase is more likely to be made in a supermarket.
Young people prefer to buy prepackaged or sliced cheese: it is convenient and can be taken, for example, on a camping trip. The older generation favors the cut-off one because they consider head-shaped cheese to be of higher quality.
The all-Ukrainian organization Consumer Trust has organized an inspection of Polish cheeses presented on the Ukrainian market. According to the results of the inspection, the head of the organization, Maxim Gonchar, said that the products turned out to be counterfeit, imported into the country in most cases illegally.
Nevertheless, the amount of imported cheese is not getting smaller because most consumers are guided by the rule: “Imports are better and of higher quality than domestic products”.
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Trends in cheese packaging design
The larger heads that come on sale are covered with natural crust, wax or latex. Small heads or portioned pieces are packed in foil or cardboard boxes. These materials may look nice, but they don’t protect against weathered and dried out product.
Sealable or Flow-Pak film is used to package block cheeses. These types of packaging help the product to retain its marketability for a long time. Thermoformable packs are used to sell product sliced into slices. Many manufacturers prefer a flow-pack, which packs cheese that weighs about 250g.
Stretch wrap is designed for cheese sliced at the point of sale. This method of packaging does not allow the product to be stored for long periods of time, but it is popular because many consumers prefer to buy a piece of cheese cut from the head.
The sliced cheese is packaged in special systems consisting of a lower rigid tray and an upper flexible film. Vacuum packaging has a negative effect on flavor and can also deform the product.
In general, the type of packaging depends on the type of cheese. Hard cheeses can be placed in just about anything, but soft cheeses, such as Camembert, are better in hard wood or plastic packaging.
The fashion for everything natural, kraft and minimal has found its response in the design of the cheese packaging as well.
- The design of labels and packaging is developed with an emphasis on traditional production technology and organic raw materials. Animal images and plant motifs are used for this purpose.
- Many consumers associate kraft packaging (cardboard or parchment) with a high quality product.
- The vintage elements in the package design will transport consumers back to a time when E stood for just a letter and only natural ingredients were used for cheese.
- The spirit of minimalism did not leave the designers. The minimalistic packages contain the name of the product and manufacturer, as well as the composition.
- Part of the whole is a trend that has been popular for several years now.
KOLORO branding agency will design the packaging and label for your product, as well as the interior design for your cheese coffee shop.
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Ukrainian cheese market: forecast
The Ukrainian cheese market is quite competitive and, despite its decline over several years, producers are trying to compensate for losses by winning foreign markets. To stay afloat, cheesemakers are expanding their product offerings in a variety of ways.
To boost imports from EU countries, the government has cut import duties on cheese to 6.7%.
Ukrainian-made cheeses are predominantly of high quality and meet many international standards. But due to the difficult economic situation and low purchasing power of consumers, some manufacturers have changed the recipe of cheese production and started to produce cheese products.
Taking into account the latest news of the cheese market, there is a probability that cheese products from Ukrainian producers will conquer foreign markets, and in the consumer basket of the average Ukrainian cheese will be more than 3.5 kg.
