According to DairyReporter, citing the annual USDA GAIN forecasts, global milk supply in 2026 is expected to grow at a moderate pace but will continue to outstrip demand. This will shape the structure of global dairy trade, with cheese becoming the key export driver.
Milk production growth is expected primarily in Argentina, Australia, and Brazil. In Argentina, milk output may increase by around 4%, supporting exports of whole milk powder, skim milk powder, butter, AMF, and cheese. In Australia, milk production is forecast to recover by 1.8%, with cheese becoming the main export category, reaching its highest volumes since 2008, while exports of milk powders are expected to decline.
Despite growing production, Brazil is expected to remain dependent on imports of milk powders in 2026. Export volumes of cheese and butter will increase only modestly, and the domestic market will continue to require significant volumes of imported dairy products.
China will remain the key importer on the global market. With stable domestic milk production, the country will maintain strong demand for whey and cheese, while imports of milk powders are expected to remain relatively stable. This makes China one of the main pillars supporting global demand.
In the European Union, milk production is forecast to decline due to herd reductions, veterinary risks, and regulatory constraints. As a result, exports of most dairy categories — including butter, milk powders, and cheese — are expected to decrease in 2026.
At the same time, the United States and New Zealand are preparing for record levels of cheese exports. In the United States, cheese will become the key export product due to competitive prices and expanding processing capacity, while New Zealand will continue its shift from milk powders toward higher-margin, value-added products.
In 2025, Uruguay’s dairy sector showed export growth driven primarily by price conditions. The only product whose exports increased both in value and volume was whole milk powder, while exports of skim milk powder, butter, and cheese faced difficulties due to competition and market constraints.
Overall, analysts note that in 2026 cheese will be the main category capable of absorbing additional milk volumes on the global market. Growing exports from the United States, New Zealand, and Argentina, along with stable demand from China, create favorable conditions for further development of this segment.
Source: DairyReporter.com
