Kazakhstan's Milk Market: Production Growth Amid Declining Consumption

Demographics and Demand

The population of Kazakhstan shows steady growth—fr om 16.9 million people in 2013 to over 20.3 million by 2025. This lays the fundamental potential for expanding consumption.

However, the actual market dynamics differ:

• Per capita spending on dairy products rose to 157,126 tenge in 2025
• In dollar terms, up to $302.9 per person

Market Volume

The overall volume of Kazakhstan's dairy market shows volatility:

• 2022 — 5.64 million tons
• 2024 — 5.38 million tons
• 2025 — 4.88 million tons

After recovering in 2024, the market again shifted to decline.

Production

Unlike consumption, milk production shows steady growth.

The main driver is industrial farms, which have increased production by 46% over the past four years.

Herd size growth during the same period was about 20%, indicating increased productivity. Productivity (yield) also grew by almost 20%.

"Growth is driven not by the number of animals but by efficiency. This is a fundamentally new stage of industry development," the expert emphasized.

Regionally, production is concentrated in: North Kazakhstan Region, Akmola Region, Pavlodar Region.

Private Subsidiary Farms

In contrast to the industrial segment, private farms show minimal dynamics:

• Production — about 700 thousand tons
• Growth — only +3.3%

This means that the traditional model of dairy production has almost exhausted its growth potential, the expert reminded.

Mikhail Mishchenko also focused on the quality of statistics in Kazakhstan's dairy industry. This includes sharp fluctuations in private farm production, a decrease in herd size with increasing production, and a mismatch between raw milk volumes and processing.

Key Issue: Raw Material Deficit

Market balance shows a fundamental gap:

• Milk production — about 1.8–2.0 million tons of industrial raw materials
• Consumption — almost 4.9 million tons

The deficit is estimated at more than 3 million tons

This gap is covered by imports, alternative raw material processing, and the use of powdered milk.

Processing

In 2024, sales of dairy products in milk equivalent increased to 4.93 million tons (+60%). However, this growth is not supported by domestic raw materials, which increases the reliance on imports.

About 145 dairy enterprises operate in the country, but their capacity is limited. At the same time, the top 10 companies account for a significant part of the processing:

• Eurasian Foods
• FoodMaster
• Danone Berkut
• Milk
• Emil

Leaders show sales growth, but the market remains fragmented.

Import: Critical Dependency

The import structure reveals key vulnerability:

• Russia — up to 54% of liquid milk supply
• Significant share in powdered milk, cheese, and whey

In specific categories:

• Cheese — dominated by Belarus and Russia
• Whey — over 80% supplied from Russia
• Butter — diversification, but dependency remains.

Historical Industry Transformation

Long-term analysis shows:

• In the USSR, production reached 6.5 million tons
• After transformation — sharp decline
• Recovery is driven by industrial farms

Essentially, the industry is undergoing a second industrialization.

The presentation also highlighted global trends already beginning to impact regional markets.

Among key factors:

• China — shift to overproduction and entry into export markets
• USA — technological breakthrough in genetics
• Precision fermentation — potential market transformation in 5–10 years