The global milk market is out of balance

“The global milk production market has been expanding continuously for more than a year: the world’s six largest exporters – including the European Union and the United States – have achieved a combined 2.7 percent annual growth, which is now putting strong supply pressure on the market”

– highlighted Zoltán Demeter, head of K&H’s agricultural business. “In parallel with the expansion of raw milk supply and high butter prices, butter production has grown spectacularly globally. However, the continuous increase in butter production for almost a year has put the price of the product under pressure, which has now resulted in a significant price decrease: in the EU, prices have decreased by 15 percent in one year, and in the United States by more than 30 percent.”

“The central question for the next period is to what extent the fall in butter market prices will affect the price of raw milk. Milk prices have been relatively stable so far in 2025, but with such a large decrease in butter prices, a downward correction may be realistic. It is questionable how the market will react to higher raw milk prices in the long term, especially if global demand does not increase significantly despite further expansion of production.”