Analysis of development of raw cow milk prices in the conditions of the Slovak Republic

Abstract

The paper is focused on the evaluation of the price development of raw cow milk in the Slovak Republic. The aim of the paper is to analyse the development of average prices of the raw Q class cows milk in 2006-2018 and to forecast the trend of these prices by June 2019. Monthly data from the Market Report of Milk and Dairy Products issued by the Agricultural Information Department-ATIS, as part of the Agricultural Paying Agency, were the base of our information resource. These data were analyzed by using the statistical software called SAS. Box-Jenkins methodology was used to model the future trend of average purchase prices of the raw Q class cows milk, designed for modeling stationary and non-stationary time series and time series with seasonal components. During the period of 2006-2018 the Slovak dairy market showed significant changes in the prices of raw Q class cows milk. Three crisis periods of the dairy sector have been identified, during which the milk price has fallen below 0.30 € per kilogram. Long-term low prices of raw cow milk led to the liquidation of primary milk producers. In the next forecast period, by February 2019 a moderate increase in the average purchase price of raw Q class cows milk is expected, followed by a decrease by June 2019.