УДК: 338.432:631.115

DOI: https://doi.org/10.36887/2415-8453-2019-4-1

Vitalii NITSENKO
Doctor of Economic Sciences, Professor, Department of Accounting and Taxation, Interregional Academy of Personnel Management
Yuriy I. DANKO
Doctor of Economic Sciences, Associate Professor,
Vice-Rector for Research Work, Sumy National Agrarian University
DEVELOPMENT OF MILK PRODUCTION IN UKRAINE AND ECONOMIC SUSTAINABILITY OF THE DAIRY COMPLEX

JEL classification: Q13

Abstract

The aim of the study was to develop theoretical, methodological and practical foundations for achieving the economic sustainability of dairy products by enterprises. The structure of the dairy subcomplex in terms of supply chain management is disclosed. This methodological approach made it possible to outline the external environment of the milk production and the dairy industry as a whole.  We consider the category «economic sustainability» as the system ability to maintain its working condition in order to achieve the planned results in the presence of various perturbation effects (destabilizing internal and external factors). The starting point was the hypothesis that the economic sustainability of the dairy subcomplex as a whole depends on the economic sustainability of milk production entities (agricultural enterprises and households). Comparing the profitability level that has the potential to provide dynamic economic stability with the average in the dairy industry proves – without active state support the dairy industry in Ukraine is in danger of phasing out.  The analysis of economic practices in Ukraine (in particular, data of the State Statistics Service) allowed to formulate the author’s vision of the directions of achieving the dairy sub-sector of the state of dynamic economic stability. They include: the development of industrial dairy cattle as opposed to the dominance of small-scale production; changes in pricing policy, as well as the calculation of government subsidies by reformatting approaches to determining the cost of milk production, which will allow to adjust the reproduction system of own livestock and will increase the profitability of the dairy industry; achievement of higher quality of dairy raw materials by means of logistical re-equipment of farms, improvement of personnel qualification, provision of high sanitary standards, improvement of veterinary services; diversification of milk distribution channels in order to reduce the market power of the processing industry enterprises.

Key words: milk production, economic sustainability, dairy subcomplex, industrial cattle breeding, dairy cattle breeding.

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The article was received 18.09.2019