FAO – Dairy Market Review, 2023

In 2023, international dairy prices saw a significant decline, with the FAO Dairy Price Index averaging 123.7, a 17.3% drop from the previous year. This was due to slower imports by major buyers like China, which had high stocks and lower demand from the HRI sector despite COVID restrictions being lifted. Higher milk production in China also contributed to the surplus of milk powders. Additionally, weakening consumer demand in East Asia and the Middle East, along with increased milk deliveries in the European Union, further lowered prices. However, prices began to rise in October due to tight export supplies in key regions like North America and Western Europe, as well as increased demand from Asian countries. The FAO skim milk powder (SMP) price index saw the biggest drop at 30.3%, followed by butter (22.8%), whole milk powder (WMP) (21.8%), and cheese (10.2%). Butter remained the most expensive dairy product, followed by cheese, WMP, and SMP in terms of dollar values per tonne.