1. Weekly News

Global

Rising Milk Production Costs Challenge Global Dairy Farmers

Dairy farmers worldwide are struggling with rising production costs, with Ireland experiencing one of the steepest increases, between 30% and 40%, according to a Rabobank report. Global production costs rose by an average of 14% from 2019 to 2024, driven by higher feed prices, regulatory pressures, and energy transition costs. Oceania remains the most cost-efficient region, while China has gained competitiveness due to lower feed prices. As expenses climb, producers face greater risks during milk price downturns, making cost control and efficiency crucial for long-term sustainability, especially in regions with stocking limitations like Europe and Oceania.

Belarus

Belarus Sets New Record in Dairy Yield per Cow

In 2024, Belarusian dairy farms achieved a milestone, with the average annual milk yield per cow surpassing 6,000 kilograms (kg) for the first time –reaching 6,198 kg, an increase of 336 kg from 2023. Brest region led with 7,731 kg per cow, an increase of 463 kg, followed by Grodno with 7,512 kg, an increase of 413 kg, and Minsk with 6,831 kg, an increase of 269 kg. Daily milk production in Belarus stands at 105% of last year’s level, highlighting continued growth in the sector.

Chile

Chilean Dairy Exports Increase in 2024

Chilean dairy exports grew by 15.6% in 2024, reaching USD 261.9 million. This increase is mainly attributed to higher demand from markets like the United States (US), Mexico, Brazil, and Colombia. Condensed milk remains the top exported product, representing 25.5% of the total value. In terms of destinations, the US led with 22.7% of exports, followed by Mexico and the United Arab Emirates (UAE).

France

French Milk Production Continues to Rise

Unlike in many European countries, France’s milk production has been increasing for over a year, with Nov-24 collections up 1.8% year-on-year (YoY) and total production for the first eleven months 1.5% higher than in 2023. Organic milk accounted for 5.1% of production, while Appellation d'Origine Protégée/ Indication Géographique Protégée (AOP/IGP)-certified milk made up 15.7%. Cheese production rose 2.4%, while yogurt and milk powder output declined.

Ukraine

Ukraine's Dairy Sector Continues to Grow Despite Challenges

Despite war-related disruptions, inflation, and power outages, Ukraine’s dairy sector demonstrated resilience and continued growth in 2024. Large-scale farms now produce 27% of the country's milk, with herd sizes increasing from 232 cows in 2019 to 289 in 2023. Milk delivered for processing rose to 3.2 million tons, up from 2.8 million tons in 2022. European Union (EU) integration efforts are strengthening, supported by partnerships such as a cooperation agreement with the European Dairy Association. Knowledge-sharing initiatives and educational collaborations further drive modernization, making Ukraine's dairy industry a model of resilience and innovation.

Ukraine Closes Borders to German Dairy and Meat Imports Due to Animal Disease Outbreaks

On January 13, Ukraine issued a decree prohibiting the import of cattle, genetic materials, raw materials, and products from Germany due to outbreaks of foot-and-mouth disease (FMD) and African Swine Fever (ASF). Outlined by Ukraine’s State Veterinary Medicine Chief Inspector, the restriction affects cattle, pigs, and other susceptible animals. In total, Ukraine has imposed import bans on products from 10 EU countries, citing outbreaks of ASF, avian influenza, and FMD. Germany is facing significant challenges, with FMD and ASF outbreaks, marking a return of FMD since 1988.

United Kingdom

UK Dairy Farms Cut Antimicrobial Use Without Impacting Herd Health

Antimicrobial use on United Kingdom (UK) dairy farms has declined by nearly 20% over five years without affecting herd health or milk production, with mastitis rates falling to 26 cases per 100 cows and bulk somatic cell counts improving. Average antimicrobial usage dropped to 12.7 milligrams/kg (mg/kg) Population Correction Unit (PCU) in 2024, while the number of herds using critically important antimicrobials fell to 3.9%. However, 25% of herds still account for 50% of total use, highlighting the need for continued efforts, particularly among high-usage farms, to reduce reliance through veterinary collaboration and proactive disease management.

UK Dairy Farm Incomes Plummet by 68%

British government data shows a sharp decline in dairy farm incomes, which dropped by 68% to approximately USD 90,000 (GBP 70,900) in 2024. After two strong years, falling milk prices have put pressure on earnings. Around 23% of dairy farmers operated at a loss, while 12% earned less than USD 31,500 (GBP 25,000) annually. Environmental regulations and subsidy cuts are expected to further impact incomes. The downturn also affected other agricultural sectors, though dairy incomes remain higher than those in arable farming.

UK Tightens Import Restrictions on Meat and Dairy Due to FMD

From January 15, the UK has banned the import of unprocessed meat, dairy, and animal by-products from the EU and European Free Trade Association (EFTA) countries following a FMD outbreak in Germany. Packaged products from Germany are also restricted. The new rules aim to protect UK agriculture and food security, with travelers warned that non-compliant products will be confiscated at borders.

2. Weekly Pricing

Weekly Powdered Milk Pricing Important Exporters (USD/kg)

Yearly Change in Powdered Milk Pricing Important Exporters (W4 2024 to W4 2025)

Germany

The price of milk in Germany has increased over the past year, with a 10% YoY rise and notable price increases of 3.44% week-on-week (WoW) and 26.69% month-on-month (MoM) to USD 4.51/kg in W4. This sharp rise is attributed to seasonal variations, high start-of-year demand, adverse weather conditions, and reduced production due to a 3.3% YoY decline in the dairy cow population. Additionally, FMD and ASF outbreaks have caused disruptions in milk production and processing, further tightening supply and driving up prices.

Belgium

Milk prices in Belgium have decreased significantly, with a 24.80% YoY drop and a 4.81% MoM decline, while WoW prices remained relatively stable with a minor 0.27% fluctuation to USD 3.76/kg in W4. This downward trend indicates a stabilization after the elevated prices in late 2024, driven by supply constraints. The price decline is mainly due to weakened demand and increased milk supply as winter progresses, with cows producing more milk during the cooler months. However, prices may rise again soon due to disease outbreaks among European cows, which could limit regional milk supply and push prices higher.

Netherlands

Milk prices in the Netherlands have experienced a significant surge, with a 33.70% WoW increase, 65.91% MoM rise, and a 36.70% YoY jump to USD 3.65/kg in W4. This sharp price increase is driven by a combination of seasonal factors, with higher demand typically observed at the start of the year. Strong local and international demand for milk has further pushed prices upward. Additionally, disease outbreaks in European countries have tightened supply across the region, contributing to the rise in prices as competition for available milk increases.

France

Milk prices in France have seen a decline, with a 0.34% WoW drop, 4.25% MoM decrease, and 4.25% YoY reduction to USD 2.93/kg in W4. This price decline can be attributed to France’s increasing milk production, which has been growing for over a year, with total production for the first eleven months being 1.5% higher than in 2023. Increased production locally is aiding with the price dop. This price drop might change if demand for french milk increases as supply tightens in the market.

Poland

Milk prices in Poland have increased, with a 4.53% WoW rise and a 20.97% MoM increase to USD 3.09/kg in W4, reflecting tightening milk supply in Europe due to outbreaks of FMD and ASF, which have disrupted production and processing. This has led to higher prices as supply becomes more constrained. However, despite these recent increases, YoY prices remain lower by 3.29%, as overall milk production has increased this year, offsetting some of the supply constraints and helping keep prices lower compared to the previous year.

3. Actionable Recommendations

Apply Disease Prevention and Risk Management

FMD and ASF outbreaks have significantly affected milk supply across Europe, leading to price increases. To prevent further disruptions, dairy farmers and producers should implement biosecurity measures such as livestock quarantine protocols, regular vaccinations, and enhanced farm sanitation practices. Additionally, implementing monitoring systems for early disease detection and restricting animal movement can prevent the spread of diseases and protect milk supply.

Implement Efficiency Improvements

As global milk production costs rise, dairy producers should focus on enhancing operational efficiency. This can involve adopting technology to optimize feed use, reduce energy consumption, and improve herd health management. Implementing best practices, such as reducing the need for costly interventions while maintaining animal health, can help lower costs and promote long-term sustainability across the industry.

Sustainability and Environmental Compliance

With rising regulatory pressures, dairy farmers should ensure that they remain compliant with environmental regulations while adopting sustainable farming practices. This includes reducing carbon footprints, optimizing waste management, and adopting renewable energy solutions. This will help mitigate the long-term cost pressures posed by energy transition and environmental policies.

Sources: Tridge, Agriland, Melkveebedrijf, Milk News, Milk UA, Nieuwe Oogst, Portal del Campo, The Cattle Site