Pricing of Milk and Dairy Products by Manufacturers and Trade Organizations

Abstract

The equivalence of exchange is a significant economic problem, and it is even more relevant to the production and processing of milk. The lack of economically reasonable prices for milk products does not contribute to its competitiveness. Milk is an indispensable food product. The analysis of the milk market indicates its instability. The increase in price for raw milk is due to some equalization of the agricultural producers; their price is 4–6 times lower than the retail price level. A comparative analysis of average prices for dairy products in the Volga Federal District showed that the highest prices were set in the Samara Region. Recently, there was an expansion of the products manufactured by domestic producers, which requires the production of high-quality raw milk. The decline in consumption of milk and dairy products was caused by economic sanctions and high prices for products of good quality. The paper gives a methodology for calculating the fair price for raw milk and dairy products, taking into account the parity coefficient and the standard level of production profitability for all parts of the technological chain, as well as its calculation for specific producers and a trade organization. The profitability of 17% showed that agricultural producers, processors, and trade organizations would receive income that should cover their main costs for the production of finished dairy products.