Dairy producers to merge and conquer

The dairy industry as a whole looks set to experience some consolidation, and it is likely that other companies will follow in Mlekovita's footsteps. This is mainly due to fears that Polish companies will not be able to compete with companies from the EU. To them, consolidation means survival. If it takes over Somlek, which had zl.120.7 million revenues in 2005, Mlekovita will close the gap between its main competitor, Mlekpol, which has zl.1.5 billion in annual revenues. Somlek would be the thirteenth company in Mlekovita, which employs 1300 people.Polish companies have to adapt and form new strategies to cope with the changing market as the consumption of dairy products in Poland is smaller than other EU countries such as France. Milk companies want to unite in order to negotiate with trade networks but what restricts them is limits on production. Representatives of the industry claim that the limit of 8.9 million liters given by EU is 2.5-3 million too small. (Rzeczpospolita, December 2-3, p.B2) M.M.