The United Kingdom: A Deep Dive into the Dairy Industry

Overview

The United Kingdom (UK) is a key player in the global dairy market, highlighted by its production of approximately 15 billion liters of milk annually from an estimated 1.8 million dairy cattle. This underscores its significant role both nationally and internationally.

Dairy Processing and Production

The UK boasts a highly developed dairy processing industry. Each year, it produces approximately 450,000 tonnes of cheese, 150,000 tonnes of milk powder, and 300,000 tonnes of whey. This advanced processing capability supports sustainable growth and innovation within the sector.

Key Dairy Enterprises

• Arla Foods: Innovates with products like Starbucks protein drinks and Lurpak® Plant-Based offerings.
• Müller: Focuses on enhancing processing capacities to support smaller farms.
• Long Clawson Dairy: Famous for Stilton cheese, with notable sales growth in mid-2023.
• Millbrook Dairy: Engages in community projects, including the Tuk-Tuk Charity Challenge.

Prominent Dairy Farms

• Sandford Farm: Committed to high-quality milk production.
• Holstein UK Herd: Significantly contributes to the national milk supply chain.
• Devonshire Dairy: Vital for dairy product distribution within the UK.
• Lancashire Farm Dairies: Specializes in yogurt and milk products.

Export and Import Dynamics

The UK is an active player in international dairy trade, with exports valued at approximately £1.6 billion and imports around £2.2 billion annually. This trade balance underscores the UK's crucial role in the global market, complemented by strong domestic consumption demand.

Recent Events and Developments

• In August 2023, Arla introduced new product lines focusing on innovation.
• Müller initiated projects to boost small farms by enhancing their processing capabilities.
• Long Clawson Dairy reported significant sales growth in Stilton cheese in July 2023.
• Millbrook Dairy participated in charitable activities like the Tuk-Tuk Charity Challenge in June 2023.
• The 29th British & Irish Cheese Awards crowned Burford by King Stone Dairy as the Supreme Champion.

Trends and Challenges

The UK dairy industry is increasingly focused on sustainability, addressing challenges such as livestock import restrictions and evolving market demands. Notable initiatives include Danone's exploration of local oat production, Skyr yogurt expansion, and the DAERA innovation program in Northern Ireland aimed at dairy reform. Yeo Valley is transitioning into organic beef production, and Saputo has implemented cost-cutting measures at the Davidstow Creamery.

Global influences, like free trade agreements and Germany's lifted pig meat import restrictions, shape the market. Optimism is noted as Unilever expands in Singapore to capitalize on health-conscious consumer trends. Future focus will be on modernization and adaptability, demonstrated by the planned Arla and DMK Group merger to create jobs and apprenticeships by 2027.

Sector Adjustments and Research Endeavors

Lakeland Dairies has announced a new base milk price in Northern Ireland, indicating sector adjustments. Discussions emphasize transparency in UK dairy farming practices to counter activist narratives. Portakabin inaugurated the Dairy Nexus at Scotland's Rural University and College to promote research in dairy sustainability and productivity.

A study co-authored by George Holmes highlights the mental well-being challenges faced by UK dairy farmers, influencing their career decisions. In a notable development, UK dairy farmers staged protests on TikTok against Müller's decision to halt milk collection, prompting producers to dispose of milk. Additionally, the UK has banned passengers from bringing meat and dairy into the country from Europe to prevent foot and mouth disease, following a high-risk assessment by Defra.

The UK Treasury plans to extend the sugar tax to milkshakes and similar beverages to combat obesity. Major milk processors, including Arla Foods and First Milk, are maintaining stable milk prices for May 2025 while cautioning about potential market volatility.

UK red meat and dairy exports to EU markets are significant, with statistics revealing that from 2022-2024, a large portion of exports was destined for EU markets: Beef (79%), Pork (37%), Sheep meat (94%), and Cheese (78%). Saputo has operations in the United Kingdom and reported a net loss due to a write-off of intangible assets in the UK.

Modified: 2025/05/18