British cheese exports reached an all-time high in volume during the second quarter of 2026, even as the country’s overall dairy exports experienced a significant decline.
Total UK cheese export volumes increased 15.3% year-on-year, equivalent to an additional 8,000 tonnes, as demand remained strong across both established European markets and emerging destinations outside the European Union.
However, the increase in physical shipments did not translate into higher export earnings. Overall cheese export value declined by 4%, reflecting softer international commodity prices.
EU Markets Lead Cheese Export Growth
European Union markets accounted for some of the largest increases in British cheese shipments during the quarter.
The Netherlands recorded an increase of approximately 1,800 tonnes, while exports to France rose by around 1,600 tonnes. Shipments to Belgium also increased by approximately 1,000 tonnes.
The growth highlights the continued importance of European markets for British dairy exporters despite broader challenges affecting international trade.
Strong demand from established destinations has helped UK cheese producers maintain export momentum, while additional growth from non-EU markets is providing further opportunities for diversification.
China and MENA Markets Add to Export Growth
Growth was not limited to European destinations.
British cheese shipments to China increased by approximately 1,000 tonnes, while exports also expanded to Singapore, Canada and several markets across the Middle East and North Africa.
Among the notable increases were shipments to Libya, which rose by approximately 1,900 tonnes, and Bahrain, where exports increased by around 1,400 tonnes.
The broader geographical spread indicates that UK cheese exporters are finding opportunities in markets beyond their traditional European customer base.
Export Value Falls Despite Higher Volumes
The record export volume came against a challenging pricing environment.
While British exporters shipped significantly more cheese during Q2 2026, the overall value of cheese exports declined by approximately 4%.
The divergence between volume and value reflects weaker global dairy commodity prices, which have reduced average returns even as demand for physical product remains strong.
For exporters, this creates a more complex market environment in which maintaining volume growth does not necessarily guarantee stronger revenues.
Milk Powder Exports Also Surge
Cheese was not the only UK dairy category to record strong export growth.
Milk powder exports increased by 22.2% year-on-year, equivalent to an additional 9,400 tonnes.
The increase was supported by plentiful domestic milk supplies and competitive pricing following strong milk production during the 2025/26 milk year.
European destinations including Germany, France, Spain and Poland recorded strong demand, while shipments also increased to non-EU markets such as Egypt, Vietnam, Malaysia and Mexico.
The availability of competitively priced product allowed British exporters to take advantage of opportunities across a broad range of international markets.
China Remains Challenging for Milk Powders
Despite growth in several overseas markets, China continued to present challenges for UK milk powder exporters.
Shipments to China remained subdued amid weaker domestic consumer demand and demographic pressures.
China has traditionally been an important destination for global dairy exporters, particularly for milk powders and other dairy ingredients.
The continued weakness in Chinese demand therefore remains an important factor influencing global dairy trade patterns.
Yogurt Exports Suffer Sharp Decline
The positive performance of cheese and milk powders was offset by significant declines in several other dairy categories.
Yogurt exports experienced one of the sharpest contractions, falling 49.7% year-on-year, equivalent to approximately 5,300 tonnes.
The decline was primarily linked to a major reduction in shipments to Ireland, where exports fell by around 4,900 tonnes, as well as weaker shipments to Southeast Asian markets.
The steep fall highlights the uneven nature of current international dairy demand, with some categories experiencing strong growth while others face considerable pressure.
Butter Exports Also Weaken
UK butter exports also declined during the quarter.
Volumes fell 4.3%, or approximately 600 tonnes, while export value dropped much more sharply by 37%.
Lower average market realisations were a major factor behind the decline in export value.
Shipments to Belgium fell by approximately 1,800 tonnes, while exports to Italy declined by around 1,000 tonnes. France also recorded a significant reduction.
These declines outweighed increases in butter shipments to the Netherlands and selected markets in the Middle East.
Overall Dairy Trade Under Pressure
The contrasting performance of different dairy categories illustrates the challenges facing Britain’s dairy export sector.
While cheese and milk powders benefited from strong demand and competitive pricing, fluid dairy products, fats and fermented products experienced significant declines.
Overall dairy shipments reportedly fell by approximately 25%, demonstrating that the record performance of selected categories was not enough to offset weaknesses elsewhere.
The situation reflects changing global demand patterns, commodity-price movements and differences in consumer demand across individual dairy products.
Strong Milk Supply Supports Export Opportunities
The UK’s strong domestic milk production has provided an important foundation for the growth in cheese and milk powder exports.
Record milk deliveries during the 2025/26 milk year increased the availability of raw material for processing, allowing dairy manufacturers to produce larger quantities of export-oriented products.
Milk powders in particular benefited from this supply environment, with competitive pricing supporting increased shipments to both European and international markets.
The development also highlights the importance of balancing domestic milk supply with international market demand.
Outlook for UK Dairy Exports
The record cheese export performance provides an encouraging signal for Britain’s dairy industry, particularly at a time when international trade remains challenging.
Strong demand across the EU, China, MENA and other emerging markets demonstrates that UK cheese continues to find opportunities across diverse destinations.
However, weaker export values and declining shipments of yogurt and butter underline the pressures facing the wider sector.
For UK dairy exporters, future growth will likely depend on market diversification, product competitiveness, pricing strategies and the ability to target markets where consumer demand remains resilient.
The Q2 results therefore present a mixed picture: record cheese volumes and strong milk powder exports on one side, but declining values and weaker shipments across several other dairy categories on the other.