The first quarter 2024 Dairy Market Insights report expects Australian dairy processors to remain under intense pressure in 2024.

The report drew attention to retail sales data indicating dairy sales volumes in Australia are slightly down or flat, except for yogurt and cheese. Trade competition is also increasing with exportable surpluses of cheese in Australia, European Union and the United States.

The report (to March 2024) is now available on our Milk Value Portal (MVP), providing a summary of the national and global factors shaping the state of the industry. Key factors identified include:

• Global dairy market fundamentals have weakened slightly over the last quarter, primarily due to increased expectations for milk growth in the European Union.
• There has been a significant uplift in trade in the past few months, as buyers have secured product at relatively low prices, but this level of activity is unlikely to continue.
• Economic headwinds in China and SE Asia are keeping a lid on consumer demand as the high cost of living impacts spending on dairy products
• In Australia increased milk production in the current season has been met by subdued demand quickly narrowing the gap between international and domestic wholesale cheese prices.
• Dairy processor margins will remain under pressure with any reduction in input costs expected to be passed onto consumers as the processors continue their battle against cheaper imported dairy products primarily from NZ, USA and the EU.

For more information visit our Milk Value Portal: milkvalue.com.au