Overview of Pakistan's Dairy Industry

Pakistan is recognized as the third-largest milk-producing nation worldwide, making its dairy industry an essential component of the country's agrarian economy. The sector contributes significantly to the national GDP and offers substantial employment opportunities.

Milk Production and Processing

With a dairy cattle population estimated at 49.6 million, Pakistan produces approximately 42 million metric tons of milk annually. However, only about 5% of this production, roughly 2.1 million metric tons, undergoes formal processing, primarily distributed to urban populations through structured networks.

Cheese, Milk Powder, and Whey Production

Pakistan's dairy industry produces around 10,000 metric tons of cheese annually. Additionally, the country manufactures approximately 160,000 metric tons of milk powder and 20,000 metric tons of whey, catering to the demand for long-shelf-life and diversified dairy products.

Key Dairy Enterprises

Major companies such as Engro Foods, Nestlé Pakistan, and Haleeb Foods play vital roles in ensuring the nationwide availability of dairy products. Noteworthy dairy farms like JK Dairy Farms and Nishat Dairy (Pvt) Ltd. are crucial in supplying milk for processing and retailing.

Exports and Imports

Pakistan exports around 40,000 metric tons of dairy products annually to neighboring regions and the Middle East. The country also imports approximately 50,000 metric tons of value-added dairy products, including cheese and flavored milk, to meet domestic demand.

Significant Dairy Market Events

Recent developments in Pakistan's dairy industry include collaboration with Italy to enhance dairy processing technologies, supported by Federal Minister for National Food Security and Research, Rana Tanveer Hussain. In 2024, imports from Belarus increased threefold, highlighting strengthened trade relations. Discussions with Federal Minister Ahsan Iqbal by the Pakistan Dairy Association regarding the 18% general sales tax on packaged milk have been noteworthy. Additionally, the Competition Appellate Tribunal upheld an antitrust decision against major dairy farmer associations in Karachi concerning milk price collusion.

Global Impact

Pakistan is a significant contributor to global milk production growth, with volumes increasing by about 3% in 2024, contributing to the overall 3% growth in Asia's milk production. Notably, similar to India, Pakistan's reported dairy production volumes are largely overstated due to the informal sector's significant share, which is challenging to measure accurately. Pakistan was a major buyer of Iranian dairy products, contributing to the increased demand for Iran's dairy exports.

Challenges

The industry faces challenges such as significant milk price hikes due to rising production and transportation costs. In Hyderabad, Pakistan, milk production has fallen to between 400,000 and 500,000 liters per day, down from approximately 700,000 liters, due to rising costs, leading many smaller dairies to close. Pakistan and the United States have agreed to enhance their agricultural collaboration, focusing on joint research into hybrid and disease-resistant crops, local vaccine production, and livestock breed improvement. The relocation of dairy farms to improve the livestock sector in Balochistan has been approved by the Chief Minister of Balochistan, Mir Sarfraz Bugti, aiming to enhance public health and improve the province's livestock and dairy development. The Punjab Food Authority conducted widespread operations against food adulteration in Lahore, leading to the sealing of a restaurant and two dairy shops, with 84,000 liters of milk inspected, resulting in significant fines and the disposal of adulterated products.

Modified: 2026/01/11