Changes in the Hungarian dairy industry after EU accession

Since EU accession the Hungarian dairy industry’s domestic market has generally expanded as turnover and consumption have both grown, but this has been increasingly due to cheap imports, while the purchase and sale of domestic products has been decreasing or stagnating (both in the domestic and foreign markets). The growth in imports has cut Hungarian corporations domestic market share to 80%. In Hungary corporate concentration has become even more pronounced with large corporations further strengthening their position and smaller ones further shrinking. Moreover, foreign ownership prevails and has the primary aim of meeting domestic demand. Changes in ownership contribute to the strengthening of vertical integration. Still, in the EU corporate concentration trends also exist. However, in the current fierce competitive market, it is not yet apparent whether non-producer ownership or co-operative ownership is more viable. Therefore the increase in Hungarian owners and ownership of processing plants by (Hungarian) producers does not necessarily signal the end of the crisis, but may in fact still signal decline. Positive aspects are increasing concentration and, from the consumers’ standpoint, cheaper dairy products. Cheaper milk products have put great pressure on milk producers (lower milk prices), and have had a positive effect on consumption trends. Milk drinks and some new milk products have been replaced by products with lower milk content and milk-imitations.

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Journal Article
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HU ISSN 1418 2106 (Other)
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Studies in Agricultural Economics, 105
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 Record created 2017-04-01, last modified 2020-10-28

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