Global milk output set to rise in 2020

Global milk production is continuing to rise, with the latest forecasts suggesting a 1% increase in 2020, according to AHDB Dairy.

This would bring worldwide milk production to 292.5bn litres – 2.9bn litres higher than the figure estimated for 2019 production, said AHDB analyst Jennie Tanner.

The figure takes into account a dip in production in Australia, where continued challenges of drought, fires and high costs of water and feed are hampering any recovery in levels.

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The production forecast for New Zealand is flat as it is unlikely to surpass the last season’s record production, Ms Tanner added.

Despite the overall increase in production, it is expected that rising demand for dairy products will eclipse the extra output.

Food and Agriculture Organization (FAO) predictions suggest a 2.1%/year increase in demand for fresh products and 1.5%/year for processed dairy products worldwide.

This means global dairy product prices are expected to remain fairly firm for the first half of 2020, as the production increase is relatively small, Ms Tanner suggested.

Here in the UK, the AHDB estimates milk production for 2019/20 will be about 12.58bn litres – 0.6% above 2018/19 and a 29-year high.

While expectations for December-March production are unchanged, provisional figures for October and November are slightly above expectations, raising the total by 4m litres, AHDB Dairy’s Katherine Jack suggested.

However, looking ahead to next season, there has been a small reduction to forecast production in April-June.

“This is due to a reduction in the dairy herd in October, with the herd size lower than previously projected,” said Ms Jack.

This has had a knock-on effect on the projected herd size next spring.

“The impact is small, taking around 2m litres off each month for April-June. But given the level of uncertainty in forecasting production, we round to the nearest 5m litres.

“The small uplift is enough to push those forecasts up by 5m litres a month once rounded,” she explained.

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