In W22 in the dairy landscape, the USDA forecasts EU cow milk production in 2023 to reach 143.9MMT, down 0.55% YoY, continuing a declining trend since 2021. This is due to the EU environmental restrictions and elevated input costs that are depressing milk production. Additionally, the increase in cow productivity can no longer compensate for the decline in the EU dairy cow herd. With declining EU milk deliveries, the milk processors are forecasted to have less milk available for factory use in 2023, which forces them to carefully assess for which products they will use the available milk. As a result, the USDA forecasts 2023 EU cheese production to increase to 10.5 MMT as consumption continues to rise YoY. This comes at the expense of the production of butter, non-fat dry milk (NFDM), and whole milk powder (WMP). Tridge’s data analysis indicates that the Tridge Belgium-Lokeren wholesale cow milk butter index fell to USD 6.16/kg, down 1% WoW. This decrease is driven by a positive start to the European milk season and ample supplies. Good weather in Europe at the start of the season is pushing milk collection numbers from steady to higher. Thus, butter inventories seem to be ample for buyer needs. In Q1 2023, EU butter production reached 526K MT, up 2.5% YoY. Although buyers have no difficulties in getting bulk butter presently, the situation might change quickly, as buyers, and sellers in the next few weeks may commit to longer-term contracts to hedge their risk against fluctuations in exchange rates.
According to MAPA, the Spanish cow’s milk weighted average price in April 2023 stood at USD 0.60/liter, a drop of almost 6% MoM but up 33% YoY. Only Asturias, the Canary Islands, and Castilla y León still exceed USD 0.64/liter on average. Meanwhile, Spanish milk production in April reached 635.66K MT, up 0.6% YoY and the first increase since March 2022. Despite the MoM increase, in the first four months of 2023, Spanish milk production totaled 2.48MMT, down 0.9% compared to the same period in 2022. According to Putu Juli Ardika, the Director General of Agro-Industry, the Indonesian government aims to meet 24% of domestic milk demand to reduce the high dependence on imported milk. He stated that before COVID-19 and foot-and-mouth disease (FMD) outbreaks, the Indonesian domestic milk sector supplied 22% of the fresh milk needs. However, Indonesian milk production has declined since the FMD outbreak, currently supplying less than 20%, with over 80% accounted for by imported milk. The growth of Indonesian milk production YoY has averaged 1% for the last 6 years, while the demand for raw materials in the milk processing industry has grown by 5.3%. Thus, the supply gap is widening. According to Ardika, efforts are being made to restore the productivity of dairy cows, which is currently at 8–12 liters per head per day. He disclosed that the productivity could potentially increase to 24–30 liters per head per day.
The Russian Ministry of Agriculture and Food reports that as of May 31st, the gross daily milk yield in the Tatarstan region amounted to 4.67K MT, 419.5MT more than in the same period in 2022, led by the Kukmorsky district (423MT), Atninsky district (345.8MT), and Baltasinsky (341.1MT). The average milk yield per cow in the Tatarstan region was 21.7kg, 1.6kg more than the 2022 level, led by the Atninsky (31.5kg), Muslyumovsky (30.8kg), and Yelabuga (29kg) areas. Lastly, MIDAGRI celebrated World Milk Day on June 1st by committing to continue supporting Peruvian milk producers to improve and increase milk production and its derivatives to raise the income of producers. Peruvian milk production has grown steadily at a rate of 2.4% per year, with the 2022 fresh milk yield reaching 2.241MMT produced by 945.55K milking cows. There are 452,218 dairy cattle producers in Peru, of which 85.9% are small producers with less than 10 heads of cattle. Dairy farming is one of the most important activities of small and medium producers since the dairy chain represents 12.3% of the Gross Value of Livestock Production, where milk production is carried out in the 25 regions, led by Cajamarca at 17.6%, Lima at 16.3%, Arequipa at 15.9%, La Libertad at 8.2%, and Puno at 6.3%. In Peru, the per capita consumption of milk reaches 87 liters per person per year. However, the FAO recommends a minimum consumption of 120 liters per person per year, suggesting further room for growth.
