You're reading: Ukraine bars imports of Belarussian milk

Ukraine on Thursday barred imports of Belarussian milk and milk products, a move which could escalate a regional trade war which started last month when Belarus' ally Russia banned imports of Ukrainian cheese.

"Excessive amounts of veterinary drugs were found in milk products from Belarus," Ukraine’s state veterinarian service said in a statement.

The Belarussian government could not be reached for comment.

Russia last month barred imports of cheese produced by three Ukrainian companies and expanded the black list to include seven firms this week, accusing them of using excessive quantities of palm oil, a cheap substitute for milk.

The Russian ban, which Ukraine says was the result of lobbying by Russian dairy producers, has put pressure on the Ukrainian milk market as cheese makers have started cutting their output and, accordingly, purchases of milk.

Thursday’s move could ease pressure on Ukrainian milk producers by eliminating competition from Belarus which devalued its rouble by 65 percent last year, drastically cutting production costs compared to foreign rivals.

Russia accounted for 80 percent of Ukrainian cheese exports last year, or $350 million in revenues.

Russia and Belarus are both members of a Customs Union, a post-Soviet trade bloc which Ukraine chose not to enter.

Kyiv and Moscow are also at odds over the price of Russian gas which Ukraine imports.

Ukrainian officials say the supply agreement signed in 2009 set an exorbitant price for the fuel but Russia has been reluctant to review it.

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