World milk production is forecast to reach 992.7m tonnes in 2025, a 1% rise on 2024’s level, according to the June edition of the UN’s biannual report on global food markets.

The growth, which the UN describes as “modest”, will be driven by continued herd expansion and gradual productivity gains in Bangladesh, India and Pakistan.

While the UN did say it projects a decline in Chinese production amid falling farmgate prices and sustained cost pressures, it said they would be more than made up for by the increases in other parts of Asia.

Strong increases are forecast for Brazil and Mexico, while the US and Argentina are also expected to show a recovery in production.

Milk output in Europe and Oceania are projected to remain stable, with some diverging national trends within those regions.

Global growth in milk production over the last three decades has meant an almost doubling of output since 1995 (see Figure 1).

Much of that growth has come from developing economies in Asia and South America, but, crucially, the increase in production has been met with an increase in demand.

In fact, the UN FAO’s dairy price index, which tracks the price of a basket of dairy goods on international markets, was at 153.5 points in May, within 3% of its all-time high reached in June 2022.

Butter and cheese led the recent price rises, supported by strong demand and tight supplies in Europe.

There was also an increase in the price of whole milk powder. Skim milk powder remained under pressure, as there were abundant supplies in Europe and slow demand growth from Asia.