Finland-based dairy group Valio said 2009 was a “difficult” year for the dairy markets as it reported a drop in net sales.
For the 12-month period Valio saw its net sales drop 3% on the previous year to EUR1.79bn (US$2.43bn).
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The firm said that increased expenses combined with a decrease in sales resulted in the milk margin falling to EUR863m compared to EUR942m in 2008.
Valio said the price paid for raw milk to producers had to be reduced twice during the year to match its return on milk equivalent.
The average milk profit for the year fell from 44 cents to 39 cents per litre. As a result, Valio said it paid its dairy co-operatives 40.4 cents per litre for raw milk, a decrease on the 47.2 cents it paid the co-operatives last year.
“The difficult market situation continued in early 2010. Cheap imports have pushed the prices of basic dairy products in Finland to a very low level compared with the rest of Europe. The weakening euro has improved milk profit from exports,” the firm said.
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By GlobalDataThe EUR 67 share issue implemented during the year and the profit for the financial year at EUR17.7 (2008: EUR -5) improved the firm’s equity/assets ratio, which rose to 43% (2008: 36%).
