1. Weekly News

Global

Global Milk Production Expected to Grow Modestly in 2025

Global milk production is projected to increase by 0.62% year-on-year (YoY) in 2025, following a decline of 0.19% YoY in 2024. Most major producers, such as Australia, New Zealand, and the European Union (EU), are expected to see growth, while the United States (US) faces a moderate drop. Argentina stands out with a forecasted 4.7% rise. Factors driving the recovery include higher milk prices, reduced feed costs, and favorable climate conditions. However, challenges like disease outbreaks and political factors may impact global supply and pricing.

Argentina

Rising Feed Costs Drive Up Dairy Production Expenses in Argentina

The temporary reduction of grain export taxes provided relief for exporters but raised dairy production costs, with short-term costs increasing by an average of 1.76%, reaching up to 2.41% in some farms, according to the National Institute of Agricultural Technology (INTA). The rise is primarily due to higher feed prices, as soybean meal and maize costs surged, leading to a 4.78% to 5.52% increase in commercial feed prices. Large and high-efficiency farms were most affected, with production costs per liter rising by 2.08%. The impact varies by farm size, and costs may continue to rise as grain prices stabilize.

Brazil

Dec-24 Milk Prices Decrease 2.7%, But 2024 Shows YoY Growth

In Dec-24, milk prices fell by 2.7% month-on-month (MoM), with the Brazil average closing at USD 0.44 per liter (BRL 2.58/L), according to the technological institute, Cepea. However, compared to Dec-23, prices rose by 21% in BRL terms. The 2024 average price was BRL USD 0.45/L (BRL 2.63/L), 1.9% higher than in 2023. Increased milk supply in Dec-24, which was linked to crop progress, put downward pressure on prices. The Milk Production Index (ICAP-L) dropped 1.4% in Dec-24 but showed an 18.3% increase for 2024. Dairy imports fell 4.3% in Dec-24, while exports grew by 15.5% during the year.

Ireland

Domestic Milk Intake Rises in Dec-24, but Annual Volume Declines Slightly

Ireland’s domestic milk intake by processors and co-ops reached 267.1 million L in Dec-24, marking a 30.1% YoY increase but 5.5% lower than Dec-22. Annual intake for 2024 totaled 8.43 billion L, down 0.4% from 2023. Fat and protein content saw slight improvements. Skim milk powder production dropped 17% YoY, while butter output also declined.

Paraguay

Paraguay’s Dairy Exports Drop 32% in January Due to Cyclical Factors

Paraguay’s dairy exports fell 32% in volume and 20% in value YoY in Jan-25, totaling 925 tons worth USD 3.68 million, according to the National Service of Quality and Animal Health (Senacsa). The decline is attributed to a seasonal shortage of surplus milk, which could persist until March, according to the Paraguayan dairy chamber, Capainlac. Powdered milk remained the primary export, with Brazil as the key buyer. Middle Eastern butter exports were minimal. Efforts to enter Taiwan, South Korea, and Japan continue but lack progress. Industry leaders expect export levels to normalize by May-25 or Jun-25.

Poland

Polish Dairy Sector Aims for Growth Amid Challenges

Poland’s dairy industry is targeting to export cheese to Asia and Africa, along with key markets including China, Nigeria, and Indonesia. However, the sector faces challenges such as sustainability regulations under the EU Green Deal, rising production costs, climate variability, geopolitical conflicts, and animal diseases. Industry leaders highlight ongoing consolidation, with milk production rising 30% despite a 92% decline in dairy farms over three decades. Exporters are looking to boost exports and comply with EU regulations, with a final strategy expected by early 2026. Calls for legislative measures to regulate retail pricing and support sustainable transitions are gaining traction.

Russia

Russia Boosts Dairy Production Amid Budget Cuts to Agriculture

In 2024, Russia significantly boosted its dairy sector support, allocating USD 777 million (RUB 80 billion), which is 1.5 times the amount provided in 2023. The government will continue offering preferential loans with an interest rate of 8.3% in 2025, while also reimbursing up to 42% of the costs for dairy plant construction in key regions. By 2030, Russia aims to produce 38.5 million tons of milk, up from 34 million in 2023.

However, despite these increased subsidies for dairy, Russia's overall agricultural support will see a 24% decrease in 2025, dropping to USD 4.95 billion (RUB 507.4 billion). The cuts are primarily attributed to inflation-driven monetary tightening. Additional funding will be allocated for leasing machinery, insurance, and subsidies for rail transport.

Russia Aims for 11-Ton Annual Milk Yield per Cow by 2030

Russian geneticists are working to enhance dairy cow potential, targeting an annual milk yield of 11 tons per cow by 2030, up from the current 9.5 tons, according to an Agriculture Ministry advisor. A unified breeding data system has been created to track pedigrees, breeder details, and production metrics, with a genetic value index to aid farmers in selecting livestock. The system is being tested in Altai Krai, Tatarstan, Udmurtia, and Arkhangelsk and will be fully available by March 1, 2026. Additionally, the Ministry plans to introduce subsidies for breeding farms to accelerate genomic selection efforts.

Udmurtia’s Milk Production Rises by 4.9% in 2024

In 2024, Udmurtia's gross milk yield reached 1.08 million tons, marking a 4.9% YoY increase. The region ranked third in the Volga Federal District, following Tatarstan (2,281.0 thousand tons) and Bashkortostan (1,590.8 thousand tons), highlighting steady growth in dairy production.

Spain

Spain's Milk Deliveries Rise by 1.5% in 2024

In 2024, Spain's milk deliveries reached 7.44 million tons, marking a 1.5% increase from the previous year. However, the country saw a decline in the number of dairy farmers, with 653 producers exiting the sector. While milk prices averaged USD 0.49/L, they were lower than in 2023. Despite the challenges, the sector experienced a slight growth in milk volumes, with a 0.5% rise in Dec-24 compared to the same period in 2023.

United States

US Dairy Industry Poised for Growth with Record Exports and New Trade Opportunities

The US dairy industry is entering a golden age, with exports reaching USD 8.2 billion in 2024, marking a USD 223 million increase from the previous year. Mexico and Canada, its top trading partners, each imported record amounts, accounting for more than 40% of US dairy exports. However, exports to China declined. The industry is optimistic about the future, with plans to capitalize on new trade agreements, particularly with Canada and the Asia Pacific region, to overcome challenges and further expand. The US dairy sector, supporting over 3.2 million jobs, continues to innovate, investing over USD 8 billion in new processing capacity.

US Dairy Cows Test Positive for H5N1 Avian Flu Variant

For the first time, US dairy cows have tested positive for the D1.1 strain of highly pathogenic avian influenza H5N1 avian flu, raising concerns about the ongoing animal epidemic and potential human transmission. Detected in Nevada, this strain has been linked to severe human cases, including the first US fatality in January. Previous H5N1 variants have already spread across 16 states, infecting over 950 farms. Symptoms in cattle include fever, reduced milk production, and mild respiratory issues. Experts warn that increasing infections among mammals could heighten the risk of viral mutations and human-to-human transmission.

2. Weekly Pricing

Weekly Powdered Milk Pricing Important Exporters (USD/kg)

Yearly Change in Powdered Milk Pricing Important Exporters (W6 2024 to W6 2025)

Germany

As of W6, the milk price stands at USD 3.62 per kilogram (kg), reflecting a significant week-on-week (WoW) drop of 21.48%, a 16.97% MoM drop , and a slight YoY decrease of 3.98%. This price decrease is part of the market stabilizing after prices peaked at USD 4.61/kg in W5 2025, the highest in the past year. The previous high prices were driven by adverse weather conditions, a 3.3% YoY decline in the dairy cow population, and disruptions caused by Foot-and-Mouth Disease (FMD) and African Swine Fever (ASF) outbreaks. While YoY prices are still lower, they are not significantly different, meaning that prices are approaching levels seen last year during this season. Despite the current downward trend, global inflation and higher production costs may keep prices elevated in the long term.

Belgium

In Belgium, milk prices have dropped slightly WoW and MoM, with the price in W6 standing at USD 3.70/kg, reflecting a WoW decrease of 1.07% and a MoM decrease of 1.33%. The YoY decline is much steeper at 25.10%. This downward trend reflects stabilization after the high prices in late 2024, which were driven by supply constraints. The price drop can also be attributed to weakened demand and an increase in milk supply as winter progresses, with cows producing more milk in cooler conditions. Additionally, the market is adjusting after the initial effects of high input costs and disruptions from previous supply chain challenges. As production conditions normalize and input costs stabilize, prices are aligning closer to typical seasonal patterns, contributing to the observed decrease.

Netherlands

In the Netherlands, milk prices have shown no change WoW, remaining stable at USD 2.17/kg in W6, reflecting consistent market conditions compared to the previous week. However, MoM prices dropped by 20.51%, as prices in previous weeks reached a peak, with W3 2025 being notably high at USD 2.73/kg and W4 2025 marking the highest point in the year at USD 3.65/kg. As a result, prices are now stabilizing to more normal levels, aligning closer to values observed earlier in the year. Despite this stabilization, YoY prices remain higher, showing a 9.05% increase. This increase reflects more complicated market conditions this year, as supply is lower than last year due to unfavorable weather conditions, while both local and international demand for milk remains strong.

France

Milk prices in France have remained volatile over the past couple of months, but the overall trend has been downward. In W6, the price stood at USD 2.95/kg, reflecting a minor MoM increase of 0.34%. However, WoW prices dropped by 5.75%, and YoY prices are down by 3.59%. This decline is largely due to France's expanding milk production, which grew by 1.5% YoY in the first eleven months of 2024. As supply continues to increase, prices are expected to experience further drops. Given the fluctuations seen in the past months, it is likely that prices will continue to fluctuate but with an overall downward trend as the market adjusts to the growing supply.

Poland

Milk prices in Poland have fluctuated over the past year, with W6 seeing declines across WoW, MoM, and YoY. Prices dropped to USD 2.81/kg, reflecting a 1.06% WoW decrease, 9.06% MoM drop, and 2.77% YoY decline. This stabilization follows a supply constraint caused by unfavorable weather and disruptions from FMD and ASF outbreaks, tightening milk supply across Europe. The sector faces challenges such as sustainability regulations under the EU Green Deal, rising production costs, and geopolitical issues. Despite these, industry leaders note consolidation and a potential 30% rise in milk production, which could push prices downward if production continues to grow.

3. Actionable Recommendations

Develop Crisis Management Plans for Animal Health Issues

The detection of avian influenza in US dairy cows and its potential spread highlight the need for robust biosecurity measures. Dairy producers globally should develop crisis management plans, including disease surveillance, quarantine protocols, and cross-sector collaboration with health authorities, to protect livestock and ensure minimal disruption to milk production.

Strengthen Domestic Milk Processing Capacities

In response to declining milk supply in countries like Ireland and Paraguay, investing in domestic milk processing infrastructure will reduce dependence on imports and stabilize local markets. Expanding processing capacity, especially for high-demand products like milk powders, can ensure more sustainable operations and help balance production surpluses and deficits.

Focus on Price Stabilization Through Long-Term Contracts

In countries such as Germany and France, where pricing volatility persists, dairy producers can enter long-term contracts with key retailers and buyers to ensure price stability. These agreements will mitigate fluctuations caused by supply issues or geopolitical tensions, providing a more predictable revenue stream and securing demand during uncertain periods.

Sources: Tridge, Agro Digital, Agro Meat, Agriland IE, Farmer PL, Gospodarz, Milk News, Spec Agro, The Cattle Site