Experts Predict Uncertain Future for Global Dairy Markets
Anticipating Uncertainty in Dairy Markets
A complex geopolitical landscape coupled with a protectionist agenda by the newly elected U.S. president has introduced new risks to the stability of global dairy markets. As experts from various sectors dissect these developments, the global dairy industry faces increasing uncertainty.
Global Dairy Market Analysis
According to the Global Dairy Update by Edwin Lloyd, General Manager of Maxum Foods, global dairy markets are experiencing a wave of uncertainty as trends continue to evolve. Lloyd highlights the weakened EU dairy fats market due to improved milk availability, yet insists on the unpredictability as the first quarter of 2025 progresses.
In the EU, while some regions show positive supply responses to profitable agricultural margins, disease and environmental constraints threaten supply growth till mid-2025. Internally, cheese prices are seeing a downward trend due to optimal milk supply, resistance to high prices and a declining EU protein demand.
U.S and New Zealand's Production Trends
Significant disease outbreaks in California currently curtail U.S. milk production. However, forecasts indicate herd expansions in early 2025 to bolster cheese production capacity. Concurrently, New Zealand is observing decelerated milk production post-peak, now largely dependent on evolving summer weather conditions. Adequate feed supplies, coupled with record milk prices, promise marginal year-on-year growth.
Competitive Dynamics Globally
The global cheese market is fiercely competitive, fueled by increased U.S. supplies, bolstered New Zealand production, and the EU's delicate balance. Meanwhile, Australian milk production forecasts for 2024/25 have modestly improved, as widespread rains have enhanced pasture conditions, though forage prices remain high.
These changing conditions underscore a landscape of uncertainty and competition as dairy markets head towards 2025. Industry stakeholders will need to navigate these challenging waters carefully.
