According to experts, seasonal milk production continues to grow in most parts of Western Europe. They predict that milk volumes in the EU may be comparable to the previous year in 2023. However, factors such as lower raw material costs, low demand, and regulatory requirements could reduce milk production.

A European dairy trade association has published a report on dairy product trade in 2022. The report states that global dairy exports ended the year 2.2% lower than in 2021, marking the first decline in global trade in two decades. Dairy exports from the EU decreased in almost all categories of dairy products, with dry milk seeing the biggest impact. The report suggests that the reduction in milk supply and decreased competitiveness in global markets were the driving forces behind the decline in export volumes. Dairy product exports from the EU to China, Indonesia, Malaysia, the Philippines, and Thailand decreased by 17-22% last year.

In Eastern Europe, milk production demonstrated significant growth in 2022 in countries such as Poland and the Czech Republic. However, the war between Ukraine and Russia is expected to have an impact on other parts of the region. Ukrainian officials note rising feed and energy prices, as well as the destruction of key components of the country’s energy infrastructure. Lower prices and greater market uncertainty for dairy products are significant challenges.

Exports have been crucial to maintaining the Ukrainian dairy industry. However, with falling raw material prices, the attractiveness and cost of exporting dairy products are decreasing.

(Source: USDA)