June 25, 2008


Russia changes definition of "milk"


A new definition for milk in Russia is worrying milk exporters to the country and could have negative effects on domestic production, a USDA report released June 19 noted.  


Under a new law signed by Russian President Dmitriy Medvedev, fluid milk that is produced from dry milk, concentrated milk or condensed milk can no longer be called "milk" and will be referred to as "milk beverage".


The new law: ''Technical Regulations for Milk and Dairy products" is creating concerns of falling consumption in the dairy sector.


The law, to  become effective on December 13, 2008 was passed by the State Duma (the lower house of the Russian legislature) on May 23, 2008, approved by the Federal Council on May 30, 2008 and signed by the President June 14, 2008.


The law concern milk and milk products as well as their production, storage, transportation, sale and utilization of milk and milk products.


The new term has created concern in the dairy sector as dry milk is widely used in the industry.


Dairy product producers fear that the term ''milk beverage'' will reduce consumption and result in lower prices for dry milk.


Dairy processors use dry milk as volumes of raw milk supplies are seasonal in Russia, with summer supply nearly double that of winter, the report said.


Supporters argue that the new technical regulation will not cause any harm to the Russian dairy industry as only 15 percent of fluid milk sales in Russia fall under this category and most of it is traded in the Russian regions where there are no dairy farms.


However, others fear it would have a negative impact on both domestic dry milk production and imports.


Belarus and Ukraine are the leading suppliers to the Russian market, accounting for more than half of Russia's milk powder imports.

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