Analysis of the causes of price fluctuations of dairy products at individual levels of the product vertical

Abstract

The paper analyzes the reasons for the prices of milk and milk products in the Czech Republic for the period 2008 – 2009. In January 2008, the purchase price of raw milk was 10.08 CZK/l, and in the subsequent period it began to decline. At the end of 2008, the price was more than 3 crowns lower, and still the decrease continued. The research determined that the essential reason for the price fluctuations is the impact of the economic crisis. A substantial portion of the article was devoted to analyzing the behavior of supermarket chains toward their suppliers. It was discovered that even here there is a lot of room for the creation of pricing policy. Margin trading networks up to 25% of the delivered goods. Price negotiations affect the position papers in the manufacturing vertical. The power of suppliers and processors is based on the establishment of a strong integration unit. In the conclusion the author discusses possible future developments in price, sales policy, and the self-sufficiency of milk production in the Czech Republic. The paper was processed within the framework of the Research Project of MSM 6046070906 "The economics of Czech agricultural resources and their effective use within the framework of multifunctional agri-food systems".