In April, milk production volumes decreased in the EU, the USA, and Oceania. The decline in milk yield was influenced by a reduction in cow herds due to diseases and the negative impact of drought on cow health, pastures, harvests, and water supply. According to FAO, in 2024, global milk production reached 982 million tonnes, an increase of 1.4% compared to 2023. This growth was ensured by a significant increase in production volumes in most regions of the world, which offset the decline in milk yield in Africa and North America.
Production and Demand
Europe. According to clal.it, in April 2025, milk yield in the EU amounted to 12.73 million tonnes, which is 1% less than in March and 1.3% less than in April 2024. In January-April 2025, the EU produced 48.35 million tonnes, a 1.6% decrease from the same period last year. According to USDA data, milk production in Europe is declining week by week. As of 2025, milk production volumes in many EU countries are currently lower than last year. The European Commission reported a drought between April 21 and 30. According to the Combined Drought Indicator (CDI), most regions of Europe recorded "watch" and "warning" levels, while parts of the Mediterranean, Middle East, and North Africa registered "alert" levels.
According to a study published in the Journal of Dairy Science, heat stress affects the reduced fertility rate of Holstein cattle in the Netherlands and genetic variability. Currently, most European countries are at their peak milk production, but there is a shortage of replacement heifers due to last year's bluetongue outbreak and its long-term consequences: lameness, weight loss, and reproductive issues (infertility and miscarriages). Cream prices have risen due to the impact of increasing air temperatures across Europe on the fat content of raw milk. As reported by The Bullvine, amidst reduced milk yield in Europe, consumers from Asian countries are switching to American butter.
According to FAO, in 2024, milk production volumes in the EU increased by 0.8% compared to 2023, as increased yields compensated for the reduction in dairy cattle numbers. At the same time, milk production in 2024 was uneven. A wet spring in the northwestern EU, particularly in Germany and the Netherlands, as well as hot weather in July and August, worsened the condition of pastures and forage crops, negatively impacting milk production.
In contrast, production volumes increased in Italy, Spain, France, and Poland due to favorable weather conditions. In Turkey, milk production grew by 4.7% in 2024 compared to the previous year, marking a turnaround after three years of declines. This growth was supported by herd replenishment through active live cattle imports, political measures within the 2024–2028 Livestock Development Roadmap, and increased processing, especially among butter producers.
According to the Global Agricultural Information Network (GAIN) report, milk production volumes in the EU in 2025 are projected at 149.4 million tonnes. A decrease in cow numbers is expected in 2025, and if this is not fully offset by increased productivity, raw milk supplies could drop to 145.3 tonnes.
USA. According to clal.it, in April 2025, the USA produced 8.78 million tonnes of raw milk, which is 2% less than in March, but 1.5% more than in April 2024. In January-April 2025, milk yield in the USA amounted to 34.53 million tonnes, which is almost at the same level as last year (+0.2%). According to USDA data, in May 2025, the spring peak of milk yields in the northeastern USA reached its maximum, but a decline in production is expected due to hot weather. Demand for school milk bottling is decreasing due to summer holidays, and more milk is being redirected to cheese and ice cream production. Cream and butter production remains active, with demand growing from ice cream and cream cheese manufacturers. In the southwest, raw milk production is slightly decreasing.
In California, milk production has slightly decreased but generally covers the needs of processors. Water reserves for cows are 114% higher than the average, allowing milk production to be maintained at a sufficient level. In Arizona, New Mexico, and the northwestern USA, milk yield is decreasing, but demand for dairy products remains stable. In the mountain states of Idaho, Utah, and Colorado, milk production varies, but supply is sufficient, while cream demand has slightly increased, and its prices have risen.
A temporary reduction in tariffs on American products by China creates opportunities for American dairy exporters in the short term. As reported by Vesper, prices for American butter are lower than for European or New Zealand butter. According to The Bullvine, export markets, particularly Mexico and Southeast Asia, are absorbing American butter faster than it accumulates in warehouses. American skimmed milk powder is becoming more expensive due to limited warehouse stocks and increased demand from Mexico. Demand for American cheeses has intensified in the domestic and export markets.
According to FAO, in 2024, raw milk production volumes in the USA decreased by 0.4% compared to 2023, despite improved farm profitability due to higher milk prices and lower feed costs. This decline is likely primarily due to farmers' limited ability to replenish herds due to record-high cow prices. In neighboring Canada, milk production increased by 1.7% compared to 2023 due to increased cow productivity and strong domestic demand for dairy products, driven by significant population growth through immigration.
Oceania. As reported by clal.it, in April 2025, milk yield in Australia amounted to 594 thousand tonnes, which is 0.3% less than in March, but 0.3% more than in April 2024. In January-April 2025, milk yield in Australia totaled 2.47 million tonnes, 2% less than last year. According to USDA data, drought in southeastern Australia, caused by insufficient rainfall and increased temperatures, has forced some farmers to reduce their herds. Victoria state, which accounts for about 60% of total milk production, was particularly affected. In March, an annual decline in milk yield of 0.5% was recorded there.
The drought led to a sharp increase in water prices, which raised farmers' costs for growing feed and pastures. Demand for butter and cheese in retail and foodservice remains high, but consumers are increasingly opting for private label products due to consistently high prices. According to FAO, in 2024, milk production in Australia increased due to favorable weather conditions and improved pasture conditions as a source of hay and feed.
As reported by clal.it, in April 2025, milk yield in New Zealand amounted to 1.45 thousand tonnes, which is 17% less than in March, but 0.5% less than in April 2024. In January-April 2025, milk yield in New Zealand totaled 7.46 million tonnes, 0.2% more than last year. In April, New Zealand experienced rains caused by remnants of a tropical cyclone, which temporarily alleviated the drought situation in milk-producing regions. However, farmers were forced to dry off cows earlier and apply supplementary feeding. Despite the rains, pasture conditions remained worse than a year ago, especially in Waikato and Taranaki.
In 2024, milk production volumes in New Zealand increased, driven by particularly favorable weather conditions during the peak milk production season (September-November), despite a challenging start to the year related to the short-term impact of the El Niño weather phenomenon, which reduced pasture and feed availability. New Zealand is forced to seek alternative markets for dairy products due to China's government policy. From September 2025, drinking milk in China can only be produced from raw milk. The Chinese government banned the reconstitution of drinking milk from milk powder to protect the interests of national producers amidst an economic downturn, falling raw milk prices, deteriorating living standards in China, and reduced consumption of dairy products in the domestic market. New Zealand is one of the key exporters of milk powder and is now negotiating a free trade agreement with India to supply premium dairy products to the Indian market.
Dairy Market Prices
Europe. According to preliminary data from the European Commission, in April 2025, the average price for raw milk in the EU was €53.40 per 100 kg, which is 0.3% more than in March 2025. Compared to April 2024 prices, milk in the EU became 16% more expensive. Most likely, the increase in milk prices is due to reduced milk yield in European countries.
USA. According to clal.it, in April 2025, the price of raw milk in the USA was €41.29 per 100 kg, which is 8% less than in March and 1.52% less than in April 2024. It is likely that in April, purchase prices in the USA decreased due to certain problems with the sale of dairy products in export markets amidst the trade war.
Oceania. According to clal.it, in April 2025, the price of raw milk in New Zealand was €39.47 per 100 kg, which is 1.96% less than in March, but 19.79% more than in April 2024. According to USDA data, dairy processing enterprises in Australia announced an increase in milk purchase prices by 20-30 Australian cents per kg of dry matter in the 2024/25 season. Australian processors note that market conditions have improved in recent months, and contracts for the second half of the 2024/25 season allow them to increase the purchase price for farmers.
Press Service of the Association of Milk Producers
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