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Government Signs Strategic Partnership Deal With One Of Hungary’s Biggest Dairy Producers

Tamás Székely 2015.07.07.

The Hungarian government signed a strategic partnership with dairy producer Alföldi Tej, the 60th company the government has signed a strategic cooperation agreement with, a foreign ministry state secretary said at the signing ceremony. Lászlo Szabó said the raw materials used in Hungarian dairy production were among the finest in the world, a testament to the potential of the Hungarian food industry. Szabó noted that Alföldi Tej has made investments of 6 billion forints, or 19 million euros, over the past ten years and accounts for 26% of Hungary’s milk output.

Alföldi Tej managing director Tibor Mélykuti recounted that 23 dairy producers in Hajdú-Bihar County had joined together in 2003 and then bought a dairy under liquidation in Székesfehérvár two years later. Monthly revenue has risen from 500 million forints then to more than 3 billion forints at present. Some 700 people now work for the company, but headcount is set to rise as Alföldi Tej expands its dairies in Debrecen and Székesfehérvár.

The Hungarian milk sector has been suffering recently by the falling milk prices. The main factors behind the negative tendency are the large global supply, the phasing out of EU milk quotas and the embargo by Russia. The milk quotas were withdrawn on 1st of April 2015, and since that time there are now no limits to milk production within the European Union. However, majority of EU member states had so far not used their full milk quotas, and Hungary too has only made use of some 75-80 percent of this opportunity.

via and MTI photo: Balázs Mohai – MTI