Page 28 - Dairy Dimension - Jan

| Volume 1 | Issue 2 | Jan-Feb 2025 FORECAST | Volume 1 | Issue 2 | Jan-Feb 2025

by 2025. This is significant because all the major milk-
Image Source: Business Standard for the first time since 2020. This could help balance the
exporting regions are expected to grow simultaneously

global dairy market, aligning supply and demand.
Whole Milk Powder Imports: A Shifting Landscape for
China
China imports a significant amount of whole milk
powder (WMP) and is expected to increase imports by
6% to 460,000 metric tons in 2025. This indicates that
China is changing its approach to dairy product
purchases, which could have a significant impact on
global markets that rely on these imports.
Economic Challenges and Consumer Sentiment in
China's Dairy Landscape
While there is optimism for an increase in China's dairy
imports, several notable economic challenges remain.
The main concerns are low consumer confidence and
weak income expectations, which result in reduced
spending on dairy products. As the expansion of the
middle class in China slows, there is less disposable
income to purchase more dairy, making it harder for the
Forecast: China's Dairy Imports average of the last ten years, indicating that China's dairy market to recover.
Despite these challenges, a ray of hope shines through.
market has fluctuated over the past decade and may be
to Recover in 2025 Following stabilizing at lower levels. Rabobank predicts a slight increase in dairy
consumption in 2024 and a projected drop in domestic
milk production. This could lead to a surge in imports.
Domestic Struggles Propel China's Dairy Import
Three-Year Decline Surge With China's milk output potentially decreasing by 1.5%
in 2025, there could be an even greater need for imports
These domestic challenges have increased the economic
pressure on Chinese dairy farmers, making it harder for to meet consumer demands, offering a promising
China's import growth could increase demand for China's dairy sector is undergoing a significant them to maintain production levels. Small to medium- outlook for the future market.
various dairy products, impacting global markets. transformation, signaling a profound shift in its dairy sized farms are struggling, leading to more farms The delicate balance between local constraints and
China's import growth could increase demand for import practices. Milk production fell by 0.5% in 2024, consolidating. This reflects not only the difficulties faced global market trends suggests a cautious but optimistic
various dairy products, impacting global markets. and experts predict it will drop by another 1.5% in 2025, by individual farmers but also a significant change in the view for those watching China's dairy market recovery.
According to a recent Rabobank report, China's dairy according to Rabobank. This decline mirrors consumer country's farming landscape. Understanding these economic factors will be crucial for
imports, which have been decreasing for three years, are demand, meaning dairy imports could increase by 2% in Lower milk production in China is a key driver behind the navigating the evolving market dynamics and capitalizing
forecasted to rise in 2025. This shift could strongly affect 2025. China is adapting to supply challenges and increase in dairy imports. Persistent economic on new opportunities for global dairy producers.
global dairy markets and prices, bringing hope to changing consumer preferences. This shift in China's challenges, such as low consumer confidence, have The Bottom Line
farmers who have experienced lower demand from the dairy market is set to impact global dairy markets exacerbated this decline and hindered recovery efforts. As the world's largest dairy importer, China's resurgence
world's largest dairy importer. significantly, potentially influencing prices and trade The situation is primed for a significant shift, and in the dairy market presents a promising opportunity for
dynamics.
China's Dairy Market at a Crossroads: A Pivotal domestic problems could offer international dairy farmers worldwide. This expansion has the potential to
Moment Amidst Rebound The expected increase in China's dairy imports in 2025 producers an opportunity to step in and meet the rising reshape the market landscape significantly, opening new
represents a notable departure from historical trends. demand. and enticing avenues for global dairy product sales.
Year Dairy Whole Milk Chinese Domestic The projected 2% increase in imports for 2025 contrasts Global Dairy Dynamics: A World of Change Amid Farmers facing reduced demand from China can now
Imports Powder Imports Milk Production with the substantial amounts purchased in 2021, when China's Growing Demand ramp up production and explore new product markets,
Growth (%) (metric tons) Change (%) China acquired around 3.95 million tons of dairy As China's demand for dairy imports grows, global milk creating excitement and motivation for the future.
2023 -8% 430,000 -0.5% products. In 2023, imports fell by 12% to 2.6 million tons. production is expected to increase to meet this rising Source: Bullvine
2024 -5% 435,000 -0.5% The predicted 6% rise in whole milk powder (WMP) need. Rabobank forecasts a 0.8% increase in milk supply
2025 2% 460,000 -1.5% imports to 460,000 metric tons in 2025 is still below the

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