The Finnish Food Safety Authority Evira has torpedoed plans from the Danish dairy giant Arla to sell cheese that was meant for the Russian market in Finland. Russia has banned the import of dairy goods from EU countries and Arla was hoping to offload its surplus on the Finnish market.
Rival Valio, which does produce cheese for the Russian market in Finland, was granted permission to sell dairy products with Russian-language labelling in Finnish supermarkets.
“We would have liked to introduce our so-called Putin cheese products, but it was not permitted,” says the director of Arla’s Finland unit, Reijo Kiskola.
Kiskola says the shipment wouldn’t have been very large, and that Arla had no desire to contest the decision.
“Evira said its decision only applies to Finnish-packed goods that were made in Finland,” says Kiskola, referring to the earlier exceptional decision made by Evira to allow the sale of other dairy’s Russian-labelled products on the Finnish market.
What would the consumer cost of the Russian-bound Arla cheeses have been in Finland?
“I don’t care to comment on that,” says Kiskola.
Oversupply a greater worry
The Russian market share of its dairy sales is not significant for Arla, in stark difference to the Finnish dairy Valio. Arla is also of the opinion that an overabundance of milk products in Europe is actually affecting the markets more acutely than the Russian ban.
Nevertheless, Arla’s Finnish director still feels that EU subsidies should be granted to Europe’s dairies to soften the blow of the Russian sanctions.
“The import ban has caused such big losses that subsidies are in any case necessary. The assistance should target the milk producers because they ultimately feel the biggest crunch,” says Kiskola.
Production costs may suffer
Arla pays its milk producers in Finland 44.8 cents per litre at present. This so-called monthly price may be reduced in the near future.
“We function on a month-to-month basis and for the month of October we will continue to work under the present prices,” says Kiskola.
Arla is also exploring the possibility of strengthening Finnish milk farm participation in the company. After all, Arla was founded years ago as a farmer cooperative.
“We have just gotten started on this issue. It remains to be seen whether we can find a way to incorporate Finnish milk producers more closely into the Arla family,” Kiskola says.
Arla is the world’s sixth-largest dairy company. Sales of Arla milk products in Finland are around 20 percent of the total market share. According to company statements, 80 percent of Arla products sold in Finland are made from Finnish milk.
Source: YLE