Page 25 - Dairy Dimension - Mar-Apr 2025

| Volume 1 | Issue 3 | Mar-Apr 2025 GLOBAL NEWS

Arla and DMK Merger to others, such as the U.S., have witnessed price increases retaliatory tariffs, causing a shift in purchasing behavior.
as a result of tightening supply. Countries like New Zealand and European nations are
Create Dairy Powerhouse European Dairy Producers now emerging as preferred suppliers for many

Arla Foods, Denmark's leading dairy producer, has international buyers. The U.S. dairy industry is facing
increasing competition, and exporters are working with
entered into a strategic merger with Germany's DMK Explore Alternative Protein the U.S. government to negotiate lower tariffs and open
Group to form Europe's largest dairy cooperative. With a Sources up new markets.
combined annual revenue of €19 billion, this merger will
allow both companies to better compete against global With increasing consumer demand for plant-based diets, India's Dairy Production
dairy giants like Nestlé and Lactalis. The new entity will major European dairy producers such as Nestlé,
benefit from an expanded product range, improved Danone, and Lactalis are exploring the addition of plant- Growth Outpaces Global
global distribution networks, and increased market based proteins to their products. These companies are Trends
leverage. The merger is a response to declining experimenting with blends of traditional dairy and plant-
European milk production, which has created based proteins from sources like peas, soy, and oats to India's dairy production is growing at a rate faster than
opportunities for larger, more efficient players in the create hybrid dairy products. The goal is to capture the most other countries, positioning India as the largest NEWS
dairy sector. growing market of consumers who are reducing their milk producer in the world. With India accounting for
New Zealand's Dairy dairy intake for health or environmental reasons but still over 23% of global milk production, the country's output
continues to increase, largely driven by improvements in
desire dairy-like products.
Production Set to Drop Global Milk Shortage Could dairy farming practices, better veterinary care, and
New Zealand, known for its dominance in global dairy investments in milk processing infrastructure. The Indian
government is also working to boost exports to
exports, is forecasting a decline in milk production for Reach 30 Million Tons by capitalize on this growth, particularly targeting markets
the upcoming season. Due to a combination of 2030, Warns IDF in the Middle East and Southeast Asia.
environmental regulations, labor shortages, and adverse
weather conditions, New Zealand's dairy farmers are The International Dairy Federation (IDF) has warned that China's Dairy Demand Slows
expecting a 3% decrease in milk production in 2025. This global milk demand could outpace supply by 30 million Amid Economic Downturn
reduction could have significant consequences for global tons by 2030. Factors contributing to this potential GLOBAL
dairy markets, as New Zealand typically supplies around shortage include climate change, land pressure, and China's dairy demand has slowed significantly as the
30% of the world's dairy exports. The country's farmers changing dietary preferences. The IDF emphasizes the country faces an economic downturn. This slowdown
are also under pressure to reduce their carbon need for strategic action to address the widening milk has impacted both domestic milk production and
emissions in line with New Zealand's ambitious climate deficit. imports, with premium dairy products such as yogurt,
goals. Global Dairy Giants Focus on cheese, and butter seeing the most significant declines.
Latin America Emerging as Sustainability As consumer spending tightens, many Chinese
households are cutting back on non-essential food
Key Dairy Export Market Major global dairy companies such as Nestlé and Lactalis items, including higher-priced dairy goods. This has
caused dairy companies, both domestic and
Latin America has emerged as a significant growth are ramping up their sustainability efforts in response to international, to adjust their pricing strategies to
market for global dairy exports. With milk production increasing consumer demand for eco-friendly products. maintain consumer interest in a more cost-sensitive
struggling in countries like Brazil and Argentina, the These companies are focusing on reducing their carbon market.
region is increasingly turning to external suppliers, footprint, adopting renewable energy for production,
particularly from the U.S. and Europe, for powdered and developing carbon-neutral packaging solutions. With EU Dairy Sector Faces Labor
milk, cheese, and butter. The growing middle class in environmental concerns becoming a significant factor in Shortage
Latin America is driving demand for dairy products, and consumer purchasing decisions, dairy companies are
international dairy companies are capitalizing on this incorporating sustainability into their core strategies to The European Union's dairy sector is facing a growing
opportunity by increasing their exports to the region. maintain market relevance. labor shortage, particularly in countries like France,
7. Global Milk Price Volatility Intensifies U.S. Dairy Exports Face Germany, and the Netherlands. As dairy farms struggle
Global milk prices have experienced significant volatility to find skilled workers to handle tasks such as milking
over the past month, with both rising and falling trends Decline Amid Tariff Woes and herd management, production costs are rising. The
observed in different regions. Factors such as changing shortage is exacerbated by the low wages offered in the
feed costs, fluctuating fuel prices, and geopolitical U.S. dairy exports have taken a hit in recent months due dairy industry compared to other agricultural sectors. In For latest news
tensions are contributing to the unpredictability of milk to ongoing trade tensions and tariff disputes, particularly response, EU policymakers are pushing for better scan here
prices. While some countries, particularly in the EU, have with China. Exports of key dairy items such as milk training programs, higher wages, and labor-saving
seen a decline in milk prices due to oversupply issues, powders, cheese, and butter have fallen as a result of technologies to address the issue.

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