Our latest Global Dairy Trade Flows Report (2022) is out! - eucolait

Our latest Global Dairy Trade Flows Report (2022) is out!

• Global demand (excluding China) was remarkably strong in 2022, with SE Asia (Indonesia & Philippines) and MENA (Algeria) leading the charge. The significant fall in China’s imports (-23% in milk equivalent) however took a toll on overall global dairy trade flows which decreased by -2,2%. Between high stock levels, strong domestic production, a zero-covid policy maintained until December 2022 and resulting supply chain disruptions, Chinese import demand fell short of the exceptional flows seen in 2021.

• Following what had seemed like a rebound in Q3 (+1.9%), global trade fell back into negative territory in the final quarter of 2022, a fall primarily caused by weaker buying activity in SE Asia and Chinese buying activity that was still subdued. Global exports were also constrained by reduced availability of milk, even though output in the Northern hemisphere recovered in the second half of 2022.

• Russia’s aggression in Ukraine had severe repercussions throughout the supply chain from farms up until the final consumer, in the form of spiralling input and energy costs and food inflation. Milk and dairy product prices reached previously unseen heights but the impact on demand seems less significant than feared.  

• Butterfat (both butter & butteroil) had the best performance among the main commodities, with butter reaching the record high levels of 2019. Cheese remains the most stable product group and shows constant growth, albeit at a slower pace than during previous years.  Powders, particularly WMP, were severely affected by the reduced import demand in China.  

• On the supply side, the US made big strides on the global market in 2022, to the detriment of the EU and New Zealand. Low milk production and uncompetitive pricing further fuelled by high energy costs negatively affected EU shipments. Trade between EU and UK improved in comparison to the first post-Brexit year, masking multiple remaining challenges.