Expert Opinion
Georghii Kukhaleishvili
analyst
Association of Milk Producers

Global Dairy Market: Producing Milk Becomes More Expensive in 2025

According to AHDB, global milk production in 2024 was significantly impacted by rising production costs in regions such as Argentina, Australia, China, Ireland, New Zealand,…

Georghii Kukhaleishvili
analyst
Association of Milk Producers

The Global Dairy Market Has Entered a Period of Calm

According to Rabobank, in the second half of 2024, the supply of raw milk improved in regions exporting dairy products amid declining demand from dairy…

Industrial Sector Increased Milk Yield in January-April 2025

Dairy farms increased the production of raw milk in January-April 2025 by 5%, which outpaces the growth rate of milk yield among leading exporters of dairy products. New Zealand increased raw milk production by only 0.2% during this period, while Australia and the Netherlands reduced milk yield by 2%. However, the situation in the dairy market does not favor further growth in milk yield in the industrial sector, according to Georghii Kukhaleishvili, an analyst at the Association of Milk Producers of Ukraine.

According to preliminary data from the Ministry of Agrarian Policy and Food of Ukraine, in April 2025, farms of all categories produced 604 thousand tonnes of raw milk, which is 48 thousand tonnes more (+9%) than in March 2025, but 27 thousand tonnes less (-4%) than in April 2024. In January-April 2025, milk yield in Ukraine amounted to 2.05 million tonnes, which is 79 thousand tonnes (-4%) less than in the same period last year. In April 2025, the share of enterprises in raw milk production was 45%, and household farms - 55%.

Enterprises produced 270 thousand tonnes of raw milk in April 2025, which is 2 thousand tonnes less (-1%) compared to March 2025, but 16 thousand tonnes more (+6%) compared to April 2024. In January-April 2025, dairy farms produced 1.04 million tonnes of raw milk, which is 53 thousand tonnes (+5%) more than in the same period last year.

In household farms, milk yield in April 2025 amounted to 334 thousand tonnes of milk, which is 51 thousand tonnes more (+18%) than in March 2025, but 43 thousand tonnes less (-11%) than in April 2024. In January-April 2025, the private sector produced 1.01 thousand tonnes of raw milk, which is 132 thousand tonnes (-12%) less than in the same period last year.

Georghii Kukhaleishvili notes that in January-April 2025, dairy farms increased raw milk production in 13 regions. Among the new leaders in production volume are Khmelnytskyi, Ternopil, and Zhytomyr Oblasts. However, based on the results of January-April, milk yield slowed down on dairy farms in Zakarpattia and Kharkiv Oblasts, despite the fact that they showed production growth in the first quarter. Zakarpattia Oblast has historically not been a dairy region, and Kharkiv Oblast, unfortunately, continues to suffer from Russian aggression. Damaged farms, forced relocation from frontline regions, as well as the uncertain situation in the dairy market do not contribute to the growth of milk yield in agricultural enterprises.

Domestic dairy processing enterprises with an outdated technological base are unable to compete in quality with enterprises in developed countries. Therefore, they are not ready to buy raw milk at market prices, as they sell their products at lower prices to withstand competition in export markets. However, in the face of rising milk production costs, low purchase prices do not meet the interests of milk producers. Dairy farms are forced to increase spending on biosecurity measures to prevent the spread of foot-and-mouth disease from Hungary and Slovakia.

There is a likelihood of a decrease in the export of dairy products to the EU in case of the cancellation of autonomous trade measures (ATMs) for milk and dairy products from Ukraine, which since 2022 have allowed domestic processing enterprises to supply their products to the EU without quotas and duties. Under pressure from farmers and politicians from Poland and France, the European Commission is reinstating tariffs and quotas on Ukrainian agricultural products from June 6, which may lead to a reduction in exports of dairy products from Ukraine to the EU. In 2024, Ukrainian companies exported 14.91 thousand tonnes of skimmed milk powder to the EU, while the annual quota for skimmed milk powder for Ukraine is only 5 thousand tonnes, and exports in the first four months of 2025 already amounted to 4.33 thousand tonnes.

We also have problems with the sale of domestic products in the domestic market. Today, the production volumes of dairy products in Ukraine exceed their sales volumes. The domestic market is experiencing a reduction in demand for dairy products amid the intensification of missile and bomb strikes by Russian occupiers on million-plus cities and the outflow of their residents abroad. Another challenge was the increase in cheese imports. Already in April, imports account for 47% of cheese sales in Ukraine. The increase in the supply of imported cheeses in Ukraine hinders the sale of products from domestic cheesemakers in the domestic market and restrains demand for raw milk.

However, milk production volumes increased in agricultural enterprises in Lviv Oblast (+24%), Khmelnytskyi Oblast (+17%), Mykolaiv Oblast (+16%), Chernivtsi Oblast (+15%), Ternopil Oblast (+11%), Vinnytsia Oblast (+9%), Poltava Oblast (+6%), Rivne Oblast (+5%), Zhytomyr Oblast (+5%), Volyn Oblast (+5%), Kyiv Oblast (+4%), Cherkasy Oblast (+3%), and Chernihiv Oblast (+2%) compared to the same period last year.

In January-March 2025, about 56% of raw milk was produced by agricultural enterprises in the following oblasts:

  • Poltava Oblast – 211.1 thousand tonnes;
  • Khmelnytskyi Oblast – 198.3 thousand tonnes;
  • Vinnytsia Oblast – 173.9 thousand tonnes;
  • Cherkasy Oblast – 147.9 thousand tonnes;
  • Chernihiv Oblast – 128.9 thousand tonnes;
  • Ternopil Oblast – 127.7 thousand tonnes;
  • Zhytomyr Oblast – 122.1 thousand tonnes.

Regarding beef production, according to preliminary estimates from the Ministry of Agrarian Policy and Food of Ukraine, in April 2025, the volume of cattle slaughter amounted to 16.8 thousand tonnes, which is 3 thousand tonnes less (-3%) than in March 2025 and 3.2 thousand tonnes less (-16%) than in April 2024. In January-April 2025, the volume of cattle slaughter in Ukraine amounted to 60.9 thousand tonnes, which is 7 thousand tonnes (-10%) less than in the same period last year.

The largest share (62%) of animals were sold for slaughter by agricultural enterprises in the following oblasts:

  • Vinnytsia Oblast – 219.9 thousand tonnes;
  • Cherkasy Oblast – 146.6 thousand tonnes;
  • Dnipropetrovsk Oblast – 124.5 thousand tonnes;
  • Lviv Oblast – 72.2 thousand tonnes;
  • Kyiv Oblast – 63.8 thousand tonnes.

Press Service of the Association of Milk Producers


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