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The International Dairy Federation (IDF) warns that the global dairy market could face a supply-demand gap of 30 million tons by 2030, driven by population growth, declining production in developed nations, and rising demand from emerging middle classes. While production is stagnating in the European Union (EU) and the United States (US), growth is occurring in India, Pakistan, Africa, and Latin America. Traditional exporters like the EU, New Zealand, and Australia face environmental and resource constraints, while countries like China are shifting toward local production. This evolving trade landscape poses new risks for global supply chains, particularly in liquid milk and butter.
Ecuador's dairy sector saw a slight decline in milk production in 2024, dropping by 1.22% to 494.95 million liters (L), largely due to fluctuating climate conditions. Price changes from Jan-25 to Feb-25 indicate mixed trends, with pasteurized milk and UHT milk prices rising, while yogurt saw a significant increase of 5.65%, and cheese prices dropped by 2.56%. The value of the dairy basket slightly decreased to USD 39.83, reflecting broader sector dynamics. Despite challenges, the sector remains resilient, with efforts focused on regulation, informality reduction, and consumer education on product quality and certifications.
In Feb-25, domestic milk intake by processors and co-ops in Ireland decreased by 7% year-on-year (YoY), totaling 327.7 million L, with a notable drop of 24.1 million L compared to Feb-24. Despite the reduction in volume, the fat content of the milk increased slightly to 4.47%, and protein content rose to 3.51%. Butter production saw a slight increase, reaching 8,500 tons. For the period from Jan-25 to Feb-25, total milk intake dropped by 2%, reflecting a continued downward trend in milk volumes compared to previous years.
In the Mexican state of Chihuahua, the dairy industry is under pressure due to prolonged drought and rising forage costs, leading to reduced milk output and the closure of many small farms. The Secretary of Rural Development, stressed the urgent need for technical support and feed quality improvements to boost productivity and sustainability. He also called for subsidies and stronger connections with major companies like Lala, Alpura, and Algodres to help local producers survive and access broader markets. The crisis currently affects nearly a thousand small-scale dairy farmers.
As of March 31, 2025, daily milk sales by Russian agricultural enterprises reached 59,000 tons, a 3.1% (+1,800 tons) YoY increase. The highest sales volumes, over 2,000 tons daily, were recorded in Tatarstan, Udmurtia, Krasnodar Krai, and the Voronezh and Kirov regions. The national average daily milk yield per cow rose to 23.4 kilograms (kg), up 1.1 kg from last year. Leading regions such as Krasnodar, Stavropol, and the Kaliningrad, Kaluga, Vladimir, and Leningrad regions reported yields exceeding 28 kg per cow, reflecting ongoing improvements in dairy efficiency across the country.
In Q1-25, dairy productivity in Sakhalin, Russia, reached 1,860 kg per forage-fed cow, marking a 5% YoY increase and boosting total milk output to nearly 12,000 tons. This upward trend, driven by improved animal health, optimized feeding practices, and a stronger fodder base, significantly reduces unit production costs, as feed accounts for over 60% of milk's cost structure. Enterprises now achieve up to 22 L per cow daily, placing the region among the top three in the Russian Far East for productivity. This efficiency, supported by over USD 11.98 million (RUB 1 billion) in subsidies in 2024, is expected to stabilize or even lower milk prices locally, with long-term goals targeting a 25% production increase by 2030.
Tatarstan plans to produce no less than 2.3 million tons of milk in 2025, reinforcing its role as a key dairy-producing region in Russia. The target reflects growing momentum in the sector, supported by a 37% increase in milk procurement prices in 2024, which has strengthened profitability for local producers and encouraged production expansion.
The United Kingdom (UK) has announced a suspension of commercial imports from Austria, Hungary, and Slovakia of cattle, pigs, sheep, goats, wild ruminants, and untreated products such as fresh meat and dairy, following the detection of multiple foot-and-mouth disease (FMD) outbreaks in these regions. The decision was made after a new case near the Austrian border in Hungary, leading to restrictions on goods coming from these countries. The UK authorities are urging livestock keepers to maintain high biosecurity and remain vigilant for clinical signs of FMD, with stricter border measures in place to prevent the entry of potentially contaminated goods.
Indiana's dairy production in Feb-25 reached 350 million pounds, marking a 1.4% decrease compared to the previous year. Production per cow in the state averaged 1,830 pounds (lbs), 40 lbs less than Feb-24, despite an increase in the herd size to 191,000 cows. Nationally, the 24 major dairy states collectively produced 17 billion lbs of milk, down 2.6% from last year but adjusted for leap year, production was up by 0.9%. Despite the national decline, the total number of milk cows in these states rose by 75,000 compared to Feb-24.
In Feb-25, Uruguay's milk purchasing power increased by 10% YoY, reaching its highest level since May-24. This growth was driven by a 14.7% rise in milk prices, outpacing a 3.7% increase in production costs. The National Institute of Milk Producers (INALE) tracks these developments through key indicators, including the Milk Price Index, Cost of Production Index, and Purchasing Power Index, providing valuable insights into farm-level income and expenses.
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Belgium's dairy prices saw a slight week-on-week (WoW) and month-on-month (MoM) decrease of 0.79%, with prices dropping to USD 3.79/kg in W14. However, despite this recent dip, prices remain 1.34% higher YoY, reflecting ongoing supply pressures. Belgium's milk production so far this year has been stable compared to the previous year, but the dairy sector is facing significant challenges, including rising farming costs, labor shortages, and an aging farming population. These factors are tightening the milk supply, which is expected to keep prices elevated in the long term, despite short-term fluctuations.
The Netherlands saw minimal fluctuations in milk prices, with slight WoW and MoM variations of a 0.86% increase and 0.43% decrease, respectively, indicating relative market stability. However, YoY prices dropped significantly by 22.26%, primarily due to the seasonal surge in milk production driven by milder weather conditions. The transition from colder months fostered pasture regrowth, leading to an increase in milk supply. This higher milk yield, supported by improved forage availability, exerted downward pressure on prices as the growing supply met the demand. The substantial YoY decline reflects the larger impact of seasonal factors, with an abundant milk supply offsetting price drops.
In France, milk prices saw a slight WoW increase of 0.74% and a more noticeable MoM rise of 3.83%, indicating a moderate upward trend in the short term. However, YoY prices dropped significantly by 17.88%, largely due to a rebound in milk production following a shift in weather patterns. Warmer conditions boosted pasture regrowth, resulting in higher milk yields. This increased milk supply helped alleviate pressure on the supply chain, driving prices down despite the ongoing challenges posed by higher production costs. The significant YoY decline reflects the impact of a more abundant milk supply in the market, which contributed to lower prices.
Given the forecasted global dairy shortfall by 2030, countries such as India, Pakistan, and regions in Latin America are becoming more prominent in dairy production. To mitigate risks from supply disruptions in traditional export markets, companies should consider diversifying sourcing strategies by establishing more robust relationships with emerging dairy producers in these regions.
Climate-related challenges, as seen in Ecuador and Mexico, highlight the importance of strengthening resilience in dairy production. Implementing advanced irrigation systems, improved feed quality, and sustainable farming practices will help mitigate the impact of extreme weather events. Government subsidies and technical support should also be pursued to enhance farm-level sustainability, particularly in regions vulnerable to droughts.
Improving dairy productivity is crucial for staying competitive and ensuring long-term profitability. Regions like Sakhalin in Russia, where productivity gains are driven by better animal health and optimized feeding, serve as a model. Investing in technologies like automated milking systems and improving feed efficiency can reduce production costs and align supply with rising demand. These initiatives help stabilize prices and enhance profitability by boosting milk yields while mitigating environmental and price risks.
Sources: Tridge, Agriland IE, Daily News Today, DBN, Farmer PL, Farmers Guide, Milk News, Nieuwe Oogst
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