EVALUATION OF RESOURCE PRICE PREFERENCES AND RESOURCE UTILIZATION EFFICIENCY IN DAIRY SECTOR

The paper deals with the evaluation of resource price preferences and resource utilization efficiency in Latvian dairy sector that shows Latvian relative competitive position both in terms of producing competitive products for the market, as well as ensuring competitive salaries and a general rise in living standard for the employees. The evaluation is carried out through analyzing price levels of the main production resources and the utilization efficiency of these resources, based on the comparison with other EU countries. The efficiency indicators in Latvian primary milk production sector are considerably lower and despite resource price preferences the cost level per production value in Latvia is higher than in other countries. The analyzed resource utilization efficiency is low in Latvia also at the processing industry level, though the current price level of the main production resources helps to ensure competitive positions of Latvian dairy products. But considering large differences in compensation levels for labour force between Latvia and other EU countries, without increase in productivity, the situation is not sustainable in long-term.