Australian Dairy Consumption Expected to Grow Amid Population Surge
Source: DairyNews.today
Australian dairy consumption is poised for modest growth in 2025, driven largely by population expansion fueled by high immigration rates, according to the latest Global Agricultural Information Network (GAIN) report from the USDA’s Foreign Agricultural Service in Canberra.
The report projects a 0.4% increase in fluid milk consumption, reaching 2.47 million metric tons (MMT) in 2025, up slightly from the revised 2.46 MMT estimate for 2024. This uptick marks a reversal of the steady decline in fluid milk consumption observed over the past five years, during which annual consumption dropped by approximately 1%.
Population Growth Spurs Consumption Rebound
Australia’s population growth has rebounded sharply since early 2023, surpassing pre-COVID-19 levels of approximately 1.5% annually. By the first quarter of 2024, the annualized growth rate had reached 2.3%, largely attributed to elevated immigration. While federal measures to moderate immigration rates are expected to temper this trend, robust population increases in 2023 and 2024 are projected to sustain growth in overall dairy consumption through 2025.
Despite higher total milk consumption, per capita milk consumption continues to decline, consistent with a long-term annual drop of about 2%. The report forecasts a population-driven decline of 1.5% in per capita consumption for both 2024 and 2025.
Milk Substitutes Plateau as Traditional Milk Holds Strong
While plant-based milk substitutes—such as almond, oat, and soy—gained popularity over recent years, their consumption peaked in 2021/22. Data from the Australian Bureau of Statistics (ABS) reveals a 7% drop in milk substitute consumption, equating to nearly 0.5 liters per person in 2022/23. This shift has slightly mitigated the overall decline in per capita fluid milk consumption.
Full-fat milk remains the dominant category, accounting for 59% of total consumption. Over recent years, it has gained market share at the expense of reduced-fat, non-fat, and UHT milk varieties. Flavored milk now represents nearly 10% of total drinking milk consumption, with moderate growth in this segment.
Factory Milk Consumption and Production Outlook
The GAIN report also highlights a 1.8% increase in factory milk consumption for 2025, forecasted to reach 6.20 MMT, up from the revised 6.09 MMT for 2024. This rise aligns with an expected increase in milk production.
Despite minor revisions to 2024 milk production estimates, fluid milk consumption's upward revision reflects a significant departure from prior trends. Fluid milk is projected to account for 28.1% of total national milk production in 2025.
Global Context and Long-Term Trends
While Australia's per capita dairy consumption remains high by global standards, it is forecast to decline from 100 liters per person in 2019 to 89 liters in 2025. The shift reflects broader trends in dietary preferences, the rise of alternatives, and evolving consumer habits.
The Australian dairy industry, still adjusting to demographic changes and economic factors, remains a critical component of national agricultural output. Looking ahead, robust population growth appears to be a key driver of market stabilization, even as per capita consumption trends downward.
Population Growth Spurs Consumption Rebound
Australia’s population growth has rebounded sharply since early 2023, surpassing pre-COVID-19 levels of approximately 1.5% annually. By the first quarter of 2024, the annualized growth rate had reached 2.3%, largely attributed to elevated immigration. While federal measures to moderate immigration rates are expected to temper this trend, robust population increases in 2023 and 2024 are projected to sustain growth in overall dairy consumption through 2025.
Despite higher total milk consumption, per capita milk consumption continues to decline, consistent with a long-term annual drop of about 2%. The report forecasts a population-driven decline of 1.5% in per capita consumption for both 2024 and 2025.
Milk Substitutes Plateau as Traditional Milk Holds Strong
While plant-based milk substitutes—such as almond, oat, and soy—gained popularity over recent years, their consumption peaked in 2021/22. Data from the Australian Bureau of Statistics (ABS) reveals a 7% drop in milk substitute consumption, equating to nearly 0.5 liters per person in 2022/23. This shift has slightly mitigated the overall decline in per capita fluid milk consumption.
Full-fat milk remains the dominant category, accounting for 59% of total consumption. Over recent years, it has gained market share at the expense of reduced-fat, non-fat, and UHT milk varieties. Flavored milk now represents nearly 10% of total drinking milk consumption, with moderate growth in this segment.
Factory Milk Consumption and Production Outlook
The GAIN report also highlights a 1.8% increase in factory milk consumption for 2025, forecasted to reach 6.20 MMT, up from the revised 6.09 MMT for 2024. This rise aligns with an expected increase in milk production.
Despite minor revisions to 2024 milk production estimates, fluid milk consumption's upward revision reflects a significant departure from prior trends. Fluid milk is projected to account for 28.1% of total national milk production in 2025.
Global Context and Long-Term Trends
While Australia's per capita dairy consumption remains high by global standards, it is forecast to decline from 100 liters per person in 2019 to 89 liters in 2025. The shift reflects broader trends in dietary preferences, the rise of alternatives, and evolving consumer habits.
The Australian dairy industry, still adjusting to demographic changes and economic factors, remains a critical component of national agricultural output. Looking ahead, robust population growth appears to be a key driver of market stabilization, even as per capita consumption trends downward.
