RaboResearch Reports Anticipate Modest Dairy Market Growth in 2025

The global dairy market is poised for modest growth in 2025, as highlighted in the first quarterly report for 2025 from RaboResearch. The report indicates a 0.8% year-on-year expansion in milk production across the Big 7 export regions, continuing into the first half of 2026.

This growth follows a challenging 2024, marked by milk production weaknesses and elevated farmgate milk prices. In the EU and US, recent fluctuations in production are expected to stabilize, though growth rates below 1% remain modest. Oceania and South America are also projected to see production increases, buoyed by overcoming previous declines.

With increasing milk flow, dairy farmers globally may see additional revenue. Sentiment is particularly strong in New Zealand, where Fonterra’s firm forecast of NZD 10/kgMS mid-point milk price for this season stands out amidst falling interest rates.

Meanwhile, China diverges from global trends with a 2.6% year-on-year drop in milk production forecast for 2025, continuing a downward trend from 2024. Despite decreased production, an uptick in demand and import improvements are expected, although challenges persist due to domestic economic issues.

Elsewhere, US cheese exports reached a record high in 2024, with a positive outlook for 2025. New Zealand continues to find markets for its surplus milk, sustaining a record-high milk price. However, analysts warn that evolving trade barriers, particularly related to US policy shifts, could pose challenges. Maintaining balanced trade and supported dairy prices will require close monitoring of consumer demand amid inflationary pressures.