IDF-The World Dairy Situation 2013

Bulletin
470
2013
of the International Dairy Federation
The World Dairy Situation 2013

Bulletin of the International Dairy Federation470/2013
VIEW THE UPCOMING IDF EVENTS AT: http://www.fil-idf.org/EventsCalendar.htm
Bulletin of the International Dairy Federation 470/2013

2013, International Dairy Federation
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Bulletin of the International Dairy Federation 470/2013

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C ON T EN T S
Foreword . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
Message from the WDS team. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
A word from our Partners . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
Summary . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
World Dairy Situation at a Glance 2012 . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
Chapter: . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
1. Milk Production . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
2. Milk Processing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3. Dairy Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
4. Consumption. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
5. World Dairy Trade. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
6. Prices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 37
7. Dairy Outlook . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 44
8. World Dairy Market Forum. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 49
8.1. Japanese Dairy Industry . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 50
8.2. The Latin American Dairy Chain . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 54
8.3. Overview on Milk Prices and Production Costs World Wide . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 62
8.4. Dairying in the EU A New Paradigm?. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 69
8.5. Managing Milk Price and Feed Cost Volatility in the United States. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
Annex 1. Country Reports. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Asia . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 83
European Union . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 103
North and Central America. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 149
South America. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 155
Other Europe. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 165
Africa . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 179
Oceania . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 185
Annex 2. Dairy Leaders in Different World Areas. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 189
Annex 3. Tables . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 194
Dairy farming. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 196
Processing. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 206
Trade . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 221
Consumption. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 225
Prices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 231
Abbreviations and Conventional Signs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 237
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World Dairy Situation 2013

duction Introduction
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what agricultural policy reforms are required to underpin the present and future success of the dairy sector. Committee on Dairy Polici
mics is a major contribution toward that objective,
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uld like to thank all organizations,
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experts,
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like thank especially
all the IDF
team
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annually by the of Productschap
members
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on Dairy Policies of Productschap
NIEL, who actively contributed to the
and development
CNIEL, who of this report.
actively We also
contributed to gratefully
the acknowledge
development of this the
report. We also
Economics is a major contribution toward that objective, as part of fulfilling the IDFs mission to represent gratefully acknowled
al support fromand
IDF's Gold the
support Partners TetraPak
dairyfinancial
industry and Agropur,
support andGold
from IDF's
globally. Silver PartnerTetraPak
Partners Saputo. and Agropur, and Silver Partner Saputo.
We would like to thank all organizations, members and experts, especially the team of Productschap Zuivel
and CNIEL, who actively contributed to the development of this report. We also gratefully acknowledge the
financial support from IDF's Gold Partners TetraPak and Agropur, and Silver Partner Saputo.
Paterson Sarah Paterson Nico van Belzen Nico van B

f IDF Standing Committee Chair of IDF Standing Committee IDF Director General IDF Director G
y Policies and Economics on Dairy Policies and Economics
Sarah Paterson Nico van Belzen

Chair of IDF Standing Committee1 1 IDF Director General
on Dairy Policies and Economics
1
1
Message from the WDS Team

For the fourth consecutive year, the Centre National Interprofessionnel de lEconomie Laitire (CNIEL) and
Productschap Zuivel (PZ) have worked together to produce the IDF World Dairy Situation report. From the
responses we get, we understand that the work done in this report is highly appreciated. Every year, readers
also come up with valuable suggestions that, when possible, are followed up and for which we are thankful.
This year we have added a graphic summary entitled World Dairy Situation at a Glance after the text
summary and we have also taken steps to find a better balance between texts and graphs in order to make
the report easier to digest. Furthermore we introduced boxes in the text to highlight certain developments or
provide further explanation.
The forum chapter is the domain of expert contributors from across the world. It has become tradition to have
the opening contribution from the country that hosts the summit. The first contribution is therefore on the
Japanese dairy sector. The second contribution is on South America. The dairy sector on this continent is
very dynamic but also relatively isolated: connections with the global market are restricted. The remaining
three contributions are about margins in the dairy farming business; the milk price is one side of the coin, but
the costs to produce milk is the other. This becomes of more interest due to the volatility on the feed market
in recent years. That explains the growing interest for the cost aspect to determine the income position of the
dairy farmer. The first contribution is from IFCN describing milk prices and costs worldwide. The other two
contributions focus on recent developments in farm-level margins in the USA and in the EU.
The country reports are based on questionnaires filled in and returned by the National Committees of IDF.
Our utmost thanks go to the National Committees who provided us with this data. The country reports are a
significant feature of the World Dairy Situation Report, allowing us to provide the most complete and detailed
overview of the global dairy situation as possible. It also provides the opportunity for individual nations to
present information on their own dairy sectors in the country report. The key developments section in the
country report is the responsibility of the National Committee. This year, for the first time, you will find
information on Kazakhstan and Portugal.
The report has been produced under contract with IDF by PZ and CNIEL. The two organizations shared their
data sources to make this report as complete as possible. As always we welcome suggestions for
improvement and invite you to communicate any such suggestions to info@fil-idf.org.
Last year we said farewell to Susan Owens and Philippe Jachnik, both of whom greatly contributed to the
WDS over the last three years. Their enthusiasm was both contagious and productive. Philippe and Susan,
thank you for your cooperation. We made a great team.
On behalf of the WDS team

Adriaan Krijger
Responsible editor
WDS team
2
2
A Word from our Partners
Gold partners
Gold partners
Agropur, the Great Canadian Dairy Cooperative, a Tetra Laval is pleased to have been invited to
proud Gold Partner of the International Dairy partner with IDF for this important publication a
Federation and the IDF World Dairy Situation source of invaluable data for the whole dairy
Report. industry. In times when society is looking for healthy
food, all of us active in the value chain of milk
production and distribution, have a responsibility to
educate all stakeholders about the tremendous
value that the dairy industry brings to people. We
trust this publication will form an integral and
important part of increasing the knowledge about
the importance of the dairy industry.
Silver partner important part of increasing the knowledge about
Silver partner
Saputo recognizes the ever-changing expectations

of consumers and the growing appetite for
innovative products. As such, we support the IDF
World Dairy Situation Report, which brings together
dairy information from all around the world. This
resource enables Saputo to remain in the forefront
of the dairy industry.
3
3
Summary
2012 was a contrasted year. In the surge of 2011s good market situation, milk production was dynamic in
most parts of the world during the first six-month period. However, the economic situation progressively
worsened during the first half-year. Cereal and soybean meal prices soared, while dairy product prices on
the world market decreased. Dairy farmers started to receive lower returns, while, at the same time, weather
conditions deteriorated in many places. Finally 2012 generated an average growth of 2.2%, slightly below
the results from the previous year. Prices came down as a consequence of this increased output in the first
half-year. Despite the surge in prices in the second half of the year, the backlog could not be cleared and
prices ended slightly below the previous years results.
World output increased for every kind of dairy product last year. Cheese and butter production developed in
line with previous years. After an exceptional rise in 2011, milk powder output remained steady, but did not
show sustained growth as it did the year before. Liquid milk output was more dynamic in 2012 than it has
been for the last few years, while production growth was sustained for fermented products. Production of
condensed milk was stable and the production of whey powder slightly increased in 2012.
In 2012 most dairy companies experienced a decrease in their turnover when expressed in USD, following
on from the depreciation of dairy product prices on the world market. For companies with headquarters in the
European Union and in Japan, this general decline was emphasized by significant depreciation of local
currencies (EUR, JPY) relative to the USD. Long-term positive outlooks for world dairy demand have strongly
stimulated investments in the milk industry. Dried dairy ingredients, which can be sold to emerging countries,
are currently the focus of dairy processing development in several exporting areas (Oceania, South Cone of
Latin America, Western Europe). The main deals concluded last year in terms of acquisition tended to stress
the international assets of the world dairy leaders.
With an estimated population amounting to 7.1 billion people, global per capita availability of milk in 2012
was on average 109.1 kg (+1%). Global per capita milk consumption has grown by 8% (+7.6 kg) in the last
seven years. Asia is the most important consuming region with 41% of total world consumption, followed by
Europe (27%). Asian per capita consumption, at 73 kg, is low compared to the other regions. EU per capita
consumption is the highest. The regions Asia, South America and Africa have seen rapid growth in
consumption.
In 2012, world dairy trade was subject to further growth and reached a volume of about 61.9 million tonnes in
milk equivalents (+8%). This growth well exceeded the annual average since 2000 (CAGR 4%). It reflects
the increasing geographical imbalance between production and consumption of dairy in the world. Trade is
needed to fill the gap. For that reason, the share of world trade in global milk production has slightly risen
over the past decade and is now nearly 9%. Still, this means that the vast majority of the global milk pool is
consumed locally and never crosses any borders. During the first half of 2012, an increase of milk output put
pressure on prices. Resilient demand from buyers in South East Asia, the Middle East and North Africa were
initially able to support market prices. Later on prices came down. The turnaround began in September,
caused by a combination of severe drought and high feed prices. But higher prices in the last quarter of the
year could not prevent commodity prices, on a yearly basis, ending below the average of recent years;
producer prices for milk also fell compared to 2011.
The OECD (Organisation for Economic Co-operation and Development) and the FAO (Food and Agriculture
Organization) have been jointly publishing an agricultural outlook every year for the last decade. Analysis of
the successive outlooks reveals that estimates of world milk production development have hardly changed
over the last few years. Consumption development for butter, cheese and whole milk powder has not really
changed either. However, the Outlook for skim milk powder consumption has been significantly modified.
They also have considerably upgraded their outlook for agricultural product and food prices over the last few
years. The FAO and OECD furthermore greatly changed their perception of dairy trade development: it may
grow much faster in the coming years than they thought in the previous Outlooks. This is particularly the
case for cheese and skim milk powder.
4
4
WORLD DAIRY SITUATION AT A GLANCE 2012

MILK PRODUCTION
World: milk production by species World: cow's milk production (share per region)
2012 Oceania
Africa 5%
5%
Other Asia
2011 Europe 28%
Cow milk 9%
2010
Buffalo milk South
America
2009 11%
Other milk
North
and
2005 Central EU 27
America 24%
18%
0 150 300 450 600 750
mln tonnes
MILK PROCESSING
World: cow's milk deliveries (A) World: dairy product output, growth 2005/12 (%) (A)
mln tonnes mln tonnes
450 25
+18%
420 20
CAGR 2005-2012: +1.8%
390 15
+28%
360 10
+23% +20%
5
330
0
300
Butter/-oil Cheese SMP WMP
2005 2006 2007 2008 2009 2010 2011 2012
(A) In 50 selected countries

CONSUMPTION
World: per capita milk consumption and population World: self-sufficiency rate (per region)
Per capita consumption (kg) World population (x mln)
115 7 400 Region 2005 2012
110 7 200 Asia 92% 93%

Europe 106% 105%
105 7 000 EU 109% 108%
Non-EU 101% 98%
100 109.1 6 800
106.4 107.9 North America 102% 104%
104.6
101.4 South America 102% 100%
95 6 600
Africa 84% 86%
Central America 75% 81%
90 6 400
Oceania 245% 311%
2005 2009 2010 2011 2012
Per capita consumption World population World 100% 100%
5
5
WORLD DAIRY TRADE
World trade: key exporters, export share (%) (B) World trade: top-5 exporters
mln tonnes (B)
20
New Zealand 28%
16
12
EU 27 26%
8
4
USA 12%
0
2005 2006 2007 2008 2009 2010 2011 2012
Australia 7% EU 27 New Zealand USA
Australia Argentina
Belarus 4%
World trade: dairy products
mln tonnes
Argentina 4% 2.5
2.0
Rest of world 19% 1.5
1.0
0% 6% 12% 18% 24% 30% 0.5
0.0
Butter/-oil Cheese SMP WMP
(B) Based on milk equivalents.
2005 2010 2011 2012
PRICES
World: dairy product prices World: producer prices for milk

USD per tonne
6 000
4 800
3 600
2 400
1 200
0
Jan-05 Jan-07 Jan-09 Jan-11 Jan-13 50-70 USD/100 kg
30-40 USD/100 kg
SMP WMP Butter Cheddar cheese
40-50 USD/100 kg > 70 USD/100 kg
6
6
1. Milk Production
1.1. Overview
2012 was a contrasted year. In the surge of 2011s good market situation, milk production was dynamic in
most parts of the world during the first six-month period. Double-digit growth even occurred in a few
countries such as Turkey, Uruguay and New Zealand. However, the economic situation progressively
worsened during the first semester. Cereal and soybean meal prices soared, while dairy product prices on
the world market decreased. Dairy farmers started to receive lower returns, while, at the same time, weather
conditions deteriorated in many places. Russia, South Europe and the United States were gripped by
drought, while very humid conditions affected milk production from July onwards in Western Europe and from
October onwards in several South American countries such as Argentina and Uruguay.
Finally, 2012, whose strong start could well have generated a global
Page 7 :
steady growth exceeding 3% over the whole year if no turnaround India
India isis by
by far
far the
the leading
leading country
country in
in
had occurred during the second half-year, generated a very average terms
terms ofof milk
milk production,
production, with
with aa total
total
growth of 2.2%, significantly below the previous years results. of
of around
around 134 134 million
million tonnes
tonnes in in
Nevertheless, several countries were unaffected by bad weather 2012/13
2012/13 (April
(April to
to March),
March), accounting
accounting
conditions during the second semester and remained rather resilient for approximately
for approximately 68% 68% of of worldwide
worldwide
in the face of stressed market conditions. Among the previously buffalo milk
buffalo milk production
production andand 9% 9% of of
named countries, that was notably the case of Turkey and New cows milk.
cows milk.
Zealand, but not true of Uruguay, which faced very humid conditions
during the last few months of 2012.
Page 9 :
Milk production growth between 2000 and 2012
2013 seems to be a reverse portrait of 2012, with a sluggish
mln tonnes All
Allspecies
species mln tonnes Cow
components of themln
Cow economic
tonnes Buffalo have been evolving in
environment
Buffalo
900 800 2013, thus having 150
an impact on milk production:
800 + 2.8% + 2.2% 700 + 2.1% + 4.4% + 3.5%
120 weather conditions were concentrated mo
+ 2.3% First, in 2012 adverse
+ 2.4% + 2.2% + 1.9% + 2.7% + 3.3% + 3.9%
CAGR CAGR conditions were rather favorable
CAGR during the first six months. Unlike
700 600 90
a bonanza time. Many countries in Europe were still suffering from
600
finish, which affected the quality of forage given to cows in ea
770 500 60
716 732 753 released to pasture
596 608 624
637 about month later 93 than 97
usual
101in most Europea
655 79 90
500 400 489
549 spring was exceptionally
30 67delayed. In New Zealand, a severe dro
580
onwards, inducing massive culling and a severe milk production de
400 // // 300 // // months of 2012. For0 the time // being,
// we cannot provide a complet
2000 2005 2009 2010 2011 2012 2000 2005 2009 the2010
second
2011 half-year
2012 of2000
2013, but2009
2005 the 2010
July 2011
to September
2012 period ap
2012: no severe drought occurred in the United States and in Ru
Source: CNIEL, PZ, FAO, IDF returning to normal
National in Europe, South America and New Zealand.
Committees.
Second, dairy product prices on the world market have been contin
1.2. Cows milk months of 2013, while they decreased all the way through the first m
Cows milk production still represents 83% of the total world milk production. Its growth rate was estimated at
+2.1% in 2012, well below 2011 development (+2.7%). As usual, milk production development was steady in
Asia (+4.4%), notably in India and Pakistan. A tremendous growth occurred in Turkey (+16%). South Korea
enjoyed a strong recovery (+12%) after a period of decline due to a violent foot-and-mouth disease outbreak.
North and Central America presented a stronger growth (+2.2%) than usual, while development in South
America (+0.7%) was significantly lower than that of the previous year. This was also the case in Africa
(+1.7%), where global growth was reined in by negative development in a few countries such as Algeria and
South Africa.
The EU presented global stability, but with contrasted evolution among countries: decline in France, United
Kingdom and Ireland, but strong growth in Denmark and most Eastern European countries with the
exception of Romania and Bulgaria.
7
7
Oceania also presented disparate trends among its two mainsprings, New Zealand showing an exceptional
rise (+8.5%), while Australia presented a decrease (-3.0%) on the year ending in June 2013.
Cows milk production annual growth in 2012
Ranking of the main producers

Annual growth
mln tonnes 2012
11/12 (% )
EU 27 152.0 0.0
United States 90.9 + 2.1
India (A) 60.1 + 4.7
China 37.4 + 2.4
Brazil 33.7 + 2.0
Russia 31.9 + 0.9
New Zealand 20.6 + 8.5
Turkey 16.0 + 15.8
Pakistan 13.9 + 3.8
Argentina 11.7 + 1.2
Mexico 11.3 + 2.1
Ukraine 11.1 + 2.6
< 0% 1 to 3%
0 to 1% > 3% (A) Estimate.
(A) Estimate.
Source: CNIEL, PZ, FAO, IDF National Committees.
1.3. Buffalo milk

In 2012, buffalo milk production kept increasing much faster (+3.5%) than cows milk production (+2.1%),
even if the pace was slower than in 2011 (+4.4%). The world production of buffalo milk was estimated at 101
million tonnes in 2012. It constituted 13% of the total world milk production, compared to 8% in 1990. Buffalo
milk is produced in only a few countries. More than 90% of the total volume is produced in India and
Pakistan. Outside Southern Asia, smaller volumes are also available in Egypt, China, Iran and Italy.
Buffalo milk production - Geographical breakdown in 2012
Europe < 1%
Asia 97%
Southern Asia 94%
Africa 2%
World: 101 mln tonnes
8
8
1.4. Milk from sheep, goats and other animals

Goat and sheep milk production development
mln tonnes Goat

Goat mln tonnes Sheep
Sheep
25 11
+ 3.2%
+ 4.6% + 2.0% + 0.6% + 4.8% - 0.9%
+ 2.9% + 1.7%
20 CAGR 10 CAGR
15 9
18.3
10 17.8 18.2 8 10.0 9.9 10.2
17.0 9.5
15.3 8.9
13.2
5 7 8.2
0 // // 6 // //
2000 2005 2009 2010 2011 2012 2000 2005 2009 2010 2011 2012

Page 7milk
Goat : constitutes around 2.4% of total milk production, sheep milk 1.3% and camel milk 0.4%. According
India is by far the leading country in
to FAO data for 2011,
termsgoat milk production,
of milk was mainly produced in Asia (60% of world production), in Africa (22%) and
with a total
in Europe (15%), ofwhereas sheep milk production
around 134 million tonnes in is located in Asia (46%) and Europe (32%), and camel milk
mostly in Africa (91%).
2012/13 (April to March), accounting
for approximately 68% of worldwide
Goat milk production hasmilk
buffalo beenproduction
increasing and
regularly
9% over
of the last few years, but this growth seems to be
slowing. In 2012 cows
this increase
milk. shrunk to 0.6%. As for sheep milk, world production increased steadily
(+3.2%) in 2012.
1.5.9Trends
Page : for 2013
2013 seems to be a reverse portrait of 2012, with a sluggish start and a dynamic finish. Two
components of the economic environment have been evolving in a contrary manner over 2012 and
2013, thus having an impact on milk production:
First, in 2012 adverse weather conditions were concentrated mostly in the second half-year, while
conditions were rather favorable during the first six months. Unlike 2012, the first half of 2013 was not
a bonanza time. Many countries in Europe were still suffering from the consequences of the bad 2012
finish, which affected the quality of forage given to cows in early 2013. Furthermore, cows were
released to pasture about month later than usual in most European countries, because the arrival of
spring was exceptionally delayed. In New Zealand, a severe drought occurred from February 2013
onwards, inducing massive culling and a severe milk production decline in comparison with the first six
months of 2012. For the time being, we cannot provide a complete view of the weather conditions of
the second half-year of 2013, but the July to September period appears to be more favorable than in
2012: no severe drought occurred in the United States and in Russia; weather patterns seem to be
returning to normal in Europe, South America and New Zealand.
Second, dairy product prices on the world market have been continuously increasing over the first nine
months of 2013, while they decreased all the way through the first months of 2012.
9
9
1.5.1. Official figures for the first half of 2013

The slow development that occurred over the last few months of 2012 continued during the first half of 2013.
Among the main producers, milk output decreased almost everywhere with the exception of the United
States (+0.5%), Mexico (+0.9%) and Ukraine (+1.1%). The set-back was especially pronounced in Russia
(-3.7%), Australia (-6.5%) and New Zealand (-9.7%).
Trend in milk production (or deliveries) in 2013
Production or 2013 Growth

Country Time period
Deliveries mln tonnes 2012/13 (%) (B)
Argentina (C) D Jan-Mar 1.7 -9.6%

Australia P Jan-July 4.6 -6.5%
Belarus P Jan-July 3.7 -0.4%
Brazil D Jan-Mar 5.9 -0.3%
Canada D Jan-June 4.0 -1.3%
Chile D Jan-July 1.1 -1.0%
EU 27 D Jan-July 84.4 -0.9%
Japan P Jan-June 3.9 -0.1%
Kazakhstan P Jan-Aug 3.5 +1.3%
Mexico D Jan-July 6.5 +0.9%
New Zealand P Jan-Aug 8.6 -9.7%
Russia P Jan-July 18.6 -3.7%
Switzerland D Jan-July 2.0 -1.1%
Turkey D Jan-July 4.8 -3.7%
Ukraine P Jan-Aug 8.0 +1.1%
USA P Jan-July 54.1 +0.5%
Uruguay D Jan-July 1.1 -0.8%
(B) Growth calculation adjusted for leap year (2012). (C) Deliveries to 20 dairies which process 64% of
national volumes.
Source: CNIEL, ZMB, USDA, DCANZ, ALIC.
Nevertheless, this sluggish start will apparently not last in the second part of 2013. The context is more
favorable to milk production than it has been since summer 2012. Lower feed costs, higher return from milk
price and normal weather conditions will tend to rekindle the output in most parts of the world.
10
10
Milk production development (12 months rolling)
Southern hemisphere

12 21
Australia New Zealand
11 20
10 19
9 18
8 17
7 16
2010 2011 2012 2013 2010 2011 2012 2013
Northern hemisphere
93 143
United States EU 27 (deliveries)
91 141
89 139
87 137
85 135
83 133
2010 2011 2012 2013 2010 2011 2012 2013

10 34
Japan Russia
9 33
8 32
7 31
6 30
5 29
2010 2011 2012 2013 2010 2011 2012 2013
Source: CNIEL, PZ, national statistics, international press.
11
11
1.5.2. Forecast for 2013 from the FAO and the USDA
Both the USDA and the FAO publish a special report twice a year, containing short term forecasts for the
dairy sector. Below is a summary of the main figures concerning milk production from the FAO Food
Outlook report published in June 2013 and the USDA Dairy: World Markets and Trade report issued in July
2013.
The FAO survey provides forecasts on global milk production (all species combined) for thirty-five selected
countries and for each continent. The USDA study supplies forecasts for cows milk production in thirteen
selected countries.
The main trends described in those two reports are rather similar. They both foresee sustained growth in
Brazil, China and India. They also agree on a small increase in milk output in the European Union, the
United States and Canada, and they both anticipate a slight decrease in Japan and no changes in Mexico.
Their analyzes do not match up perfectly for Ukraine and New Zealand: FAO forecasts sustained growth for
Ukraine and a slight decrease for New Zealand, while USDA appears to be much less optimistic.
Comparison of FAO and USDA forecasts for milk production in 2013
FAO USDA
All species milk production (%) Cow milk production (%)
Canada + 0.6 + 0.6
Mexico stable stable
USA + 0.7 + 0.9
Argentina + 0.1 + 3.5
Brazil + 3.0 + 2.8
EU 27 + 0.1 + 0.1
Russia + 1.0 - 1.0
Ukraine + 3.0 + 1.4
India (D) + 4.0 + 4.1

China + 5.7 + 6.3
Japan - 1.3 - 0.7
Australia (E) - 1.7 - 0.5

New Zealand (F) - 0.7 - 6.8
(D) Year ending in April 2013 for FAO; calendar year for USDA.
(E) Year ending in June 2013 for FAO; calendar year for USDA.
(F) Year ending in May 2013 for FAO; calendar year for USDA.
Source: FAO Food Outlook June 2013, USDA World Dairy Markets and Trade July 2013.
12
12
2. Milk Processing
2.1. Cows milk deliveries

According to the data collected from IDF National Committees and other bodies, cows milk deliveries
increased globally by 1.8% in 2012. This rate was below that of 2011 but almost similar to the average
observed for the last decade. Several countries faced an exceptional set-back, notably Egypt (-13.0%),
which had to cope with a severe outbreak of foot-and-mouth disease. In line with milk production
development, deliveries decreased in Australia (-3.0%) and in South Africa (-1.8%), while showing double-
digit growth in Turkey and South Korea, as well as a steady rise in New Zealand (+8.5%). In Russia,
deliveries, which absorb about 59% of the national milk, showed a much stronger growth (+5.9%) last year
than milk production (+0.9%).
Cows milk delivery development in 2012
Global development 2000-2012 (A)

mln tonnes
450
+ 2.7% + 1.8%
+ 1.9% + 1.9%
400
CAGR
350
405
380 388 398
300
357
250 321
200 // //
2000 2005 2009 2010 2011 2012
(A) In 50 selected countries.
Main countries and areas (B) < 0% 1 to 3%

Annual growth
mln tonnes 2012 0 to 1% > 3%
11/12 (% )
EU 27 140.3 + 0.6
United States 90.4 + 2.1
China 27.9 + 1.8
Brazil 23.0 + 2.5
New Zealand 20.5 + 8.5
Russia 18.8 + 5.9
(B) India not ranked.
Source: CNIEL, PZ, FAO, USDA, IDF National Committees.
2.2. General overview of dairy product output

World output increased for every dairy product last year. Growth was in line with the previous years results
for cheese and butter. After an exceptional rise in 2011, milk powder output remained steady, but did not
experience sustained growth as it did the year before.
Consolidated and extensive figures are not available for fresh dairy products. Only global trends are derived
from national statistics. However, according to the data collected for this report, liquid milk output was more
dynamic in 2012 than it has been for the last few years, while production growth was sustained for fermented
products.
13
13
Dairy product output development in selected countries (C)
mln tonnes mln tonnes mln tonnes Cow's milk cheese

Liquid milk Butter and butteroil
140 12 22
+ 3.6%
130 + 2.6%+ 1.0% 10 + 1.9% + 4.7% + 3.3% 20
+ 2.2%
+ 1.4% + 3.4% + 2.0% + 4.7% + 2.1%
CAGR CAGR
120 8 18
19.0
9.7 18.6
132
110
126 128
6
8.9
9.4 16 17.4 18.2
121 123 8.8 16.2
7.6
100 4 14
6.5 14.6
90 2 // // 12 // //
2008 2009 2010 2011 2012 2000 2005 2009 2010 2011 2012 2000 2005 2009 2010 2011 2012
mln tonnes WMP mln tonnes SMP

6 4.5
+ 5.2%
5 + 8.3% + 3.5% 4.0 - 2.4% + 6.2%
+ 2.4% + 1.2%
+ 7.1% CAGR
CAGR
4 3.5
4.0
3 4.3 4.5 3.0 3.8
4.0 3.7 3.6
3.7 3.7 3.3 3.3
2 2.5
3.0
1 // // 2.0 // //
2000 2005 2009 2010 2011 2012 2000 2005 2009 2010 2011 2012
Source: CNIEL, PZ, FAO, IDF National Committees, USDA.
2.2.1. Liquid milk and fresh dairy products
Liquid milk and fermented products - output development in selected countries
Liquid milk (D) Fermented products (F)

Annual growth Annual growth
mln tonnes 2012 mln tonnes 2012
11/12 (%) 11/12 (%)
EU 27 32.9 - 0.4 EU 27 9.3 - 1.5
United States 24.0 - 1.7 China 4.1 + 3.9
China 21.5 + 28.7 Iran 2.3 + 12.5
Brazil 11.7 + 2.5 United States 2.0 + 3.4
India (E) 8.9 + 3.1 Turkey 1.6 + 6.5
Mexico 3.8 - 11.6 Japan 1.0 + 10.2
Japan 3.7 - 1.8 Mexico 0.7 + 18.0
(D) No data available for Russia. (F) No data available for India and Russia.
(E) Figures for cooperatives only.
Source: CNIEL, PZ, Eurostat, IDF National Committees, ZMB.
(C)
Total for each product determined by the compilation of data issued by 50 selected countries, representing at least 90% of world
production for butter, cows milk cheese and milk powders, and 75% for liquid milk.
14
14
According to data collected from IDF National Committees and other bodies, world liquid milk production
increased by 3.6% in 2012. This result as a whole covers wide variations among countries. With the
exception of Mexico, sustained growth continued in most emerging countries, with an incredible rise in China
(+29%), while output decreased in many developed economies such as the United States (-1.7%), the
European Union (-0.4%) and Japan (-1.8%).
Production of fermented products increased in most parts of the world. This growth was especially
impressive in Mexico (+18.0%), Japan (+10.2%) and Iran (+12.5%). The success of Greek-style yoghurt was
the growth mainspring in the United States (+3.4%) and will apparently remain so in 2013. The EU was one
of the few exceptions to this positive trend, showing a decrease of 1.5% in 2012. This setback was
significant in several European countries, such as Germany (-4.3%), United Kingdom (-5.2%) and Belgium
(-6.8%).
2.2.2. Butter and other milk fats

World output of butter and other milk fats (butteroil, ghee) is estimated at around 10 million tonnes.
According to the data collected, this output increased by 3.3% between 2011 and 2012. India is by far the
worlds leading country, amassing about 40% of the global output. After a decade of decline, butter
production increased in the EU for the second year in a row. However, EU production is expected to decline
again in 2013.
Butter and butteroil output development
Global development 2000-2012 for the two main players

Development in 2012
mln tonnes India mln tonnes EU 27
5 + 4.5% 2.5 - 0.5% for the main countries and areas
+ 6.4% + 4.0% CAGR
- 1.1% + 2.9% + 1.0% Annual growth
4 2.0 mln tonnes 2012
+ 8.3% 11/12 (% )
CAGR India 4.5 + 4.5
3 1.5
4.5 EU 27 2.0 + 1.0
4.2 4.3 United States 0.8 + 2.8
2 3.9 1.0 2.1
2.1 2.0 2.0 2.0 2.0 Pakistan (G) 0.7 -
2.7 New Zealand 0.5 + 5.7
1 0.5
1.9 Russia 0.2 - 0.5
0 // // 0.0 // //
2000 2005 2009 2010 2011 2012 2000 2005 2009 2010 2011 2012 (G) Estimate.
Source: CNIEL, PZ, FAO, USDA, IDF National Committees, ZMB.
2.2.3. Industrial cheese

World production of natural cheeses (that is all cheeses excluding processed) is slightly over 20 million
tonnes. Cows milk cheeses produced from milk delivered to dairies (that is industrial cheeses) represent
more than 80% of the global natural cheese production. The rest is made up of farm and home-made
products, but also cheeses from other types of milk (sheep, goat and buffalo milk). Europe and North
America still dominate more than 70% of the worlds natural cheese production.
According to the data collected, cows milk cheese output increased by 2.2% between 2011 and 2012. With
a few exceptions such as Egypt, cheese production grew last year in most parts of the world. Despite
sluggish deliveries, cheese production was maintained in the EU, showing a slight increase (+ 1.4%) due
mainly to very dynamic exports. In the United States, cheese output continued its growth at a higher rate
than over the previous decade. Exports there have also been a significant driving force for cheese
production.
15
15
Cows milk cheese output development

Development in 2012
mln tonnes EU 27 mln tonnes United States for the main countries and areas
10 6
Annual growth
+ 1.4% + 3.7% + 1.5% + 2.8% mln tonnes 2012
9 + 2.9% + 1.3% 5 + 2.2% 11/12 (%)
+ 1.6% CAGR
EU 27 8.8 + 1.4
CAGR
8 4 United States 4.9 + 2.8
8.8 4.9 Brazil 0.7 + 3.1
8.7
7 8.6 3 4.7 4.8
8.3 4.6 Egypt 0.6 - 8.2
8.0 4.2 Turkey 0.6 + 8.7
6 7.2 2 3.7 Argentina 0.5 + 3.2
Russia 0.4 + 4.8
5 // // 1 // //
2000 2005 2009 2010 2011 2012 2000 2005 2009 2010 2011 2012
Source: CNIEL, PZ, IDF National Committees, ZMB.
2.2.4. Milk powders

World production of WMP is estimated at around 4.5 million tonnes. According to the data collected, global
production grew by 3.5% between 2011 and 2012. The two main players, New Zealand (+9.6%) and China
(+5.2%) firmly increased their production in 2012, while the structural decline in the European Union
continued (-2.9%).
Whole and semi-skimmed milk powder output development

Development in 2012
New Zealand China
1.5 1.5 1.5 for the main countries and areas
+ 9.6%
+ 20.5% + 7.2% + 4.5% + 5.2%
1.2 1.2
+ 23.3% CAGR + 2.4% Annual growth
1.0 mln tonnes 2012
0.9 + 4.5% 0.9 11/12 (% )
CAGR New Zealand 1.3 + 9.6
1.3 1.1
0.6 1.1 0.6 1.0 China 1.1 + 5.2
1.0
0.8
0.9 0.5 0.9 1.0 EU 27 0.7 - 2.9
0.7
0.3 0.5 0.3
0.5 Brazil 0.5 + 3.1
Argentina 0.3 - 0.4
0.0 // // 0.0 // //
0.0
2000 2005 2009 2010 2011 2012 2000 2005 2009 2010 2011 2012
Source: CNIEL, PZ, IDF National Committees, USDA, ZMB.
World production of SMP is estimated at around 4 million tonnes. According to the data collected, global
production grew by 5.2% between 2011 and 2012. Stimulated by heavy demand, the output of skim milk
powder increased last year in most parts of the world. The United States even presented a double-digit
growth (+10.3%); the EU stabilized its production (-0.1%).
16
16
Skim milk powder output development

Development in 2012
mln tonnes United States
mln tonnes EU 27 for the main countries and areas
1.6 1.2
+ 10.3%
- 0.9% 1.0 + 7.1% Annual growth
1.4
CAGR + 12.4% - 0.1% + 2.0% + 4.7% mln tonnes 2012
11/12 (% )
- 7.1% 0.8
CAGR
1.2 EU 27 1.2 - 0.1
1.0 United States 1.0 + 10.3
1.3 0.9
1.0
1.2 1.2 1.2 0.6
0.8 0.8 India 0.5 + 4.7
1.1 1.1 0.7 0.7 New Zealand 0.4 + 5.5
0.8 0.4
Australia 0.3 + 8.8
// // Brazil 0.1 + 6.8
0.6 // // 0.2
2000 2005 2009 2010 2011 2012 2000 2005 2009 2010 2011 2012
Source: CNIEL, PZ, USDA, IDF National Committees, ZMB.
2.2.5. Condensed milk

The geographical breakdown of condensed milk production has changed considerably over the last three
decades. World production, which, in the eighties, was dominated by the EU, the United States and the ex-
USSR, is now much more scattered with significant contributions in the Far East (Malaysia, Thailand,
Singapore and China) and South America (Brazil, Peru, Chile). FAO estimated world production to be rather
stable between 2008 and 2011 at around 4.9 to 5.0 million tonnes.
After years of decline, condensed milk production increased massively in the European Union (+8.3%) in
2012, stimulated by growing exports to third countries, notably to Libya. Peru continued its regular growth to
440 thousand tonnes, almost doubling its output compared to its level in 2000.
2.2.6. Whey products, caseins and other dairy ingredients

According to export data, casein output in New Zealand presented a double-digit growth last year. In the EU,
output was estimated at around 150 thousand tonnes, 5 thousand tonnes more than in 2012.
Liquid whey production results mainly from the industrial production of cheese, which generates more than
80% of the total whey available, and secondarily from casein output. For this reason, the major processors of
whey are located in Europe, North America and Oceania, which correspond to the major cheese production
areas. Compared to 2011, no significant changes occurred last year in the United States; production
remained rather stable with 500 thousand tonnes of whey powder and condensed whey, as well as
200 thousand tonnes of whey protein concentrates and almost 30 thousand tonnes of whey protein isolates.
Total production of whey powder within the EU is estimated at around 2.1 million tonnes. It greatly increased
in 2012 (+5.9%).
17
17
3. Dairy Industry
3.1. World dairy leaders evolution in 2012

In 2012 most dairy companies experienced a decrease in their turnover when expressed in USD, following
on from the depreciation of dairy product prices on the world market. For companies with headquarters in the
European Union and in Japan, this general decline was emphasized by significant depreciation of local
currencies (EUR, JPY) relative to the USD.
Top 25 World dairy leaders (dairy turnover in bln USD) (A)
Annual growth
Company Country 2010 2011 2012
2011/12
1 Lactalis FR 12.5 17.5 20.2 + 15%
2 Nestl (B) (C) CH 19.6 18.6 19.8 + 7%
3 Fonterra (D) NZ 11.9 15.3 15.8 + 4%
4 Danone (B) FR 12.9 15.6 15.0 - 4%
5 FrieslandCampina NL 11.9 13.4 13.2 - 1%
6 DFA US 9.8 13.0 12.1 - 7%
7 Dean Foods (E) (F) US 12.1 13.1 11.5 - 12%
8 Arla Foods DK 8.7 10.3 10.9 + 6%
9 Meiji Dairies (G) JP 7.0 7.4 7.5 + 1%
10 Morinaga Milk Industry (G) JP 6.8 7.4 7.2 - 3%
11 Saputo (G) CA 5.8 6.8 7.2 + 4%
12 Yili CN 4.4 5.8 6.7 + 15%
13 Mller (E), (e) DE - - 6.0
14 Lala (e) MX - - 6.0
15 Mengniu CN 4.5 5.8 5.7 - 1%
16 DMK DE 5.3 6.4 5.7 - 11%
17 Sodiaal FR 5.3 6.1 5.6 - 9%
18 Bongrain FR 4.7 5.5 5.2 - 5%
19 Land O'Lakes US 3.5 4.3 4.2 - 4%
20 Glanbia IE 3.4 4.4 3.9 - 12%
21 Kraft Foods (H) US 7.0 7.7 3.8 - 50%
22 Agropur (I) CA 3.2 3.7 3.7 - 1%
23 Schreiber (e) US - - 3.5
24 Bel FR 3.2 3.5 3.4 - 3%
25 Tine NO 3.1 3.5 3.4 - 2%
(A) Kerry, Unilever, PepsiCo and Mondelez not ranked.

(B) Infant formula excluded.
(C) Income statement changed in 2011.
(D) Year finishing in July.
(E) All activities included.
(F) Morningstar activities (sold on the 3rd of January 2013) are not taken into account in 2012 results.
(G) Year finishing in March of the following year.
(H) Split activities with Mondelez on the 1st of October 2012 ; Mondelez dairy activities are not taken into account in 2012 results.
(I) Income statement changed in 2012.
(e) Estimate.
Source: CNIEL, company reports, international press.
18
18
Two American companies faced sustained decrease of their turnover due to exceptional conditions. First,
Kraft Foods split its global business, including dairy activities, with Mondelez, therefore dividing its dairy
turnover in two. Second, in its 2012 results, Dean Foods did not take into account the activity of its subsidiary
Morningstar, which was officially sold to Saputo in early 2013.
In opposition to the general trend, a few companies registered sustained growth last year. In 2012, for the
first time over a whole fiscal year, French Lactalis consolidated the activity of Italian Parmalat taken over in
mid-2011, consequently boosting its turnover by 15%. Chinese Yili was spared from sanitary problems last
year, which was not the case of some of its local competitors. Thus, in 2012 it was again able to retain its
double-digit growth as experienced over the last few years.
3.2. Mergers and acquisitions in 2012 and early 2013

3.2.1. Operations finalized in 2012
The main deals concluded last year in terms of acquisition tended to stress the international assets of the
world dairy leaders. If we exclude the deals finalized by private equity capital firms, there was only one very
important national transaction last year: the purchase of Japanese fermented milk processor Calpis by the
Japanese brewery group Asahi. All other acquisitions took on an international dimension, and very often
involved assets located in emerging countries. By way of example, Danone took control of Moroccan dairy
group Centrale Laitire and completed the acquisition of the nutrition business of the Indian group
Wockhardt. FrieslandCampina took control of Filipino dairy group Alaska while Coca Cola took over Mexican
dairy Santa Clara Mercantil de Pachuca. Last but not least, Nestls interest in purchasing the infant formula
business of Pfizer was clearly linked to the fact that 85% of the turnover of this activity is generated in
emerging countries.
Main acquisitions finalized in the dairy sector in 2012
Buyer Acquisition Amount

(mln USD)
Nestl (CH) Worldwide infant formula business of Pfizer 11 850
Asahi (JP) Japanese fermented milk processor Calpis 1 480
Saputo (CA) American Morningstar 1 450
Danone (FR) (from 38% to 67% of) Moroccan dairy Centrale Laitire 710
Montagu Private equity firm (FR) French spread processor Saint Hubert 550
FrieslandCampina (NL) (from 8% to 98%) Philippine dairy processor Alaska ~450
Mller (DE) British dairy Robert Wiseman 440
Pacific Equity Partners (AU) Australian ice cream business of Nestl 310
Arla Foods (DK) 6% of Chinese dairy leader Mengniu 290
Danone (FR) Indian infant formula and nutrition activities of Wockhardt 240
Coca Cola (US) Mexican Santa Clara ~200
Arla Foods has also been very active over the last year in terms of mergers and acquisitions. It acquired 6%
of Chinese dairy leader Mengniu and merged with two other cooperatives: German Milch-Union Hocheifel
(MUH) and British Milk Link. As a matter of fact, Arla Foods now controls a milk pool of 13.5 billion litres,
positioning itself as the leading dairy in the UK and number three in Germany.
19
19
Another important merger also occurred in the United States. Late December 2012, three dairy co-ops from
Wisconsin voted to merge, creating the largest dairy co-op in the MidWest. The new, combined cooperative,
known as FarmFirst Dairy Cooperative, began its business functions on 1 January 2013.
Page 20:
Main mergers finalized in the dairy sector in 2012
In Europe
merged with
Germany Great Britain

Turnover (2011): 965 mln USD Turnover (2011/12): 1 bln USD
1.3 bln kg of milk in 2011 1.18 bln kg of milk in 2011-12
In the United States
+ + =
Madison (Wisconsin) Manitowoc (Wisconsin) Brookfield(Wisconsin)
2 300 farms 2 650 farms 500 farms
3.2.2. Operations finalized early 2013

Page 26: Fast food in China
Chinese Mengniu has been in the middle of several important operationsInwhich recentoccurred
years, lifestyle
over thechanges
first few in
China have contributed
months of 2013. First, it agreed to buy 26.9% of China Modern Dairy for 400 million USD, lifting its stake to to a
consumer shift
about 28%. Second, plans went ahead to acquire 75% of Chinese infant formula supplier Yashili for more from traditional
restaurants
than 1.5 billion USD. Third, it settled a joint-venture with Danone to produce yoghurt intowards
China, while moreDanonewestern
took a stake of 4% in its capital. fast food establishments which also
serve cheese in their dishes. Higher
FrieslandCampina has been also very active over the last few months. While incomes
Fonterra and
and theurbanization
leading Dutch have
increased
cheese wholesaler A-Ware set up a partnership in 2012, leading to the current demand for
construction of afast
160 food. Yum!
million
Brands inc., owner
USD cheese factory in Heerenveen in the Netherlands, in early 2013, FrieslandCampina bought of the KFC and
the second
Pizza hut restaurants
top Dutch cheese wholesaler Zijerveld, which generates a turnover exceeding 500 million USD. Furthermore, chains, already
has
FrieslandCampina took over a 7.5% stake in New Zealander dairy processor Synlait. more than 5 400 KFC and Pizza
Hut locations. It plans to open 700
An important operation also occurred in West Africa. A private investmentnew units Dubai,
firm from in 2013. theMcDonalds
Abraaj Group, plans
bought Fan Milk International (FMI), based in Denmark, for 300 million USD. Through its subsidiaries, FMIby
to increase the number of outlets
over
sells over 1.8 million products daily in the rapidly growing market of Ghana, 300 toTogo,
Nigeria, 2 000Ivory
in 2013.
Coast, Benin
and Burkina Faso.
20
20
Main acquisitions finalized in the dairy sector over the first 8 months of 2013
Buyer Acquisition Amount

(mln USD)
Mengniu (CN) 75% of Chinese infant formula supplier Yashili (I) 1 540
PAI Private equity firm (FR) British ice cream maker R&R 1 130
Danone (FR) 4% of Chinese Mengniu (+ JV between both partners) 420
Mengniu (CN) 27% of Chinese milk producer Modern Dairies 400
Abraaj Group Private equity firm (AE) Danish Fan Milk selling fresh & frozen dairy products in West Africa 300
FrieslandCampina (NL) Dutch cheese wholesaler and packer Zijerveld (Turnover > 500 mln USD) -
3.3. Intended investments

Long term positive outlook for world dairy demand has strongly stimulated investments in the milk industry
over the last few months. Dried dairy ingredients, which can be sold to emerging countries, are currently the
focus of dairy processing development in several exporting areas (Oceania, South Cone of Latin America,
Western Europe). Foreign investors are also taking part in building these new dryers in order to secure
sourcing. This is notably the case in New Zealand, where Chinese companies Yashili and Yili are currently
building infant formula factories. This is also the case in Europe, where Synutra has set up a partnership with
French Sodiaal to build a 130 million USD factory located in France.
Investments of more than 100 million USD announced (and/or finalized) in Oceania
New Zealand
Fonterra 3 milk powder factories > 500 mln USD
Yili (CN) 1 infant formula factory 175 mln USD
Australia Yashili (CN) infant formula 175 mln USD
Murray Goulburn 3-year plan 205 mln USD Synlait 3-year plan 145 mln USD
In the United States, investments dedicated to dried dairy products are carried out by several companies
such as Agropur and Southwest Cheese, but the domestic market also remains very attractive for several
products, notably cheese and yoghurt, drawing massive investments. For instance, in December 2012
Chobani opened the biggest yoghurt factory in the world in Twin Falls (Idaho). In June 2013, PepsiCo and
German Mller inaugurated a new 250 million USD yoghurt factory, while Greek Fage is planning to expand
its existing facilities in Johnstown (New York).
21
21
Investments of more than 100 million USD announced (and/or finalized) in America
United States
Agropur (CA) cheese factory extension & whey factory 200 mln USD
Bel (FR) 1 cheese factory 120 mln USD
Fage (GR) yoghurt factory extension 100 mln USD
Fair Oaks Farms 1 dairy beverage factory 125 mln USD
Mller (DE) - PepsiCo 1 yoghurt factory 250 mln USD
Select Milk Producers 1 milk beverage factory 130 mln USD
Southwest Cheese whey factory extension 100 mln USD
Leprino 1 cheese factory 250 mln USD
Chobani 1 yoghurt factory 450 mln USD
Brazil
Chile Vigor 5-year plan 230 mln USD
Nestl (CH) 1 milk powder
factory 140 mln USD Uruguay
Estancias del Lago integrated project
Argentina (farms + 1 powder factory) 225 mln USD
SanCor - Mead Johnson (US)
infant formula 245 mln USD
In Asia, investments are mainly focused on dairy products consumed locally, that is, liquid milk, dairy
beverages and yoghurts. One specific feature of the investments carried out on this continent is the
overlapping between farming and processing activities. Several processors, like Mengniu, Nestl and
Fonterra in China, are heavily involved in the farming business. Furthermore, several integrated projects,
including both farming and processing activities, are currently under way in Vietnam and India.
Investments of more than 100 million USD announced (and/or finalized) in Asia
China
Nestl (CH) training centre 400 mln USD
Mengniu ~10 mega farms 555 mln USD
Mengniu 2 factories 380 mln USD
Japan
Meiji 1 fermented milk factory 140 mln USD
Vietnam
Vinamilk 2 factories 200 mln USD
TH Milk integrated project 2010-2015
(farms + 3 factories) 450 mln USD
India
Tirumala integrated project 1 125 mln USD
Amul 5-year plan 550 mln USD
Parag Milk 2 factories 190 mln USD
Indonesia
PT Indolakto 1 factory 130 mln USD
Nestl 1 milk powder factory 200 mln USD
22
22
Investments in Europe are much more diversified today than they were a few years ago in terms of products.
Previously, investments used to be focused mainly on products sold on the domestic market (liquid milk,
yoghurt and cheese), because Europe faced an considerable lack of competitiveness in comparison with
other providers on the world market such as New Zealand or Argentina. This is no longer the case. In
several regions of the European Union (Ireland, The Netherlands, Denmark, Northern Germany, Western
France), where significant additional volumes of milk are expected after the dismantling of quotas in 2015,
investments mostly concern processing facilities dedicated to export products such as whey and milk
powders, hard cheese and mozzarella.
Investments of more than 100 million USD announced (and/or finalized) in Europe
Denmark Norway
Arla Foods Group investments 2012 325 mln USD Tine 1 sustainable factory 285 mln USD
Arla Foods 1 lactose factory in 2013 150 mln USD
United Kingdom
Russia
Arla Foods 1 liquid milk factory 220 mln USD
Danone 5-7-year plan 500 mln USD
The Netherlands Rusmolco (Olam) 3-year plan 400 mln USD
Friesland Campina investments Moloko Holdings 1 organic mega farm 190 mln USD
over the year 2012 > 200 mln USD
A-Ware cheese factory 160 mln USD Germany
Hochwald 2-year plan 130 mln USD
Ireland Milei whey factory ~100 mln USD
Glanbia 1 milk powder factory 230 mln USD
Dairygold 1 milk powder factory 165 mln USD
Switzerland
Kerry 1 R & D centre 100 mln USD
Nestl research centre, 10-year budget 530 mln USD
France
Sodiaal Synutra 1 infant formula factory 130 mln USD Italy
Lata 2-year plan 130 mln USD Lactalis 3-year plan 230 mln USD
Bongrain World industrial investments in 2012 190 mln USD
23
23
4. Consumption
4.1. Global dairy consumption

Global dairy consumption is measured by total world milk production and adjusted for stock changes. World
milk production growth increased by 2.2% in 2012 and reached a level of 770 million tonnes. Because of
strong worldwide dairy demand, world dairy stocks on balance fell to a lower level for the third year in a row
in 2012. Consequently, more dairy products were available on the market for consumption. With an
estimated population amounting to 7.1 billion people, on average global per capita availability of milk in 2012
was 109.1 kg (+1%). Global per capita milk consumption has grown by 8% (+7.6 kg) in the last seven years.
Per capita milk consumption Development in world population

kg mln
115 7 400
110 7 200
105 7 000
100 107.9 109.1 6 800
104.6 106.4
95 101.4 6 600
90 6 400
2005 2009 2010 2011 2012 2005 2009 2010 2011 2012
Source: calculation based on world milk production and population (Population Reference Bureau).
4.2. Regional consumption

Regional dairy consumption is measured by the regional milk production and trade of dairy products. Asia is
the most important consuming region with 41% of total world consumption, followed by Europe (27%). Asian
per capita consumption, at 73 kg, is low compared to other regions. EU per capita consumption is the
highest in the world and almost four times higher than in Asia. The more developed dairy regions like
Europe, North America and Oceania traditionally have far more milk and milk products in their diets.
Regions that have a self-sufficiency ratio of less than 100%, bridge the gap with demand by imports. Asia,
Africa and Central America are regions with high net dairy imports. The European Union and North America
are relatively large net exporters. Oceania however is the only region in the world where consumption is
lower than the net exports volume. More than 70% of production is exported.
Global consumption by region in 2012

Consumption Per capita Share (%) Share (%) Self-
2012 consumption world world sufficiency
(mln tonnes) consumption production ratio
Asia 311.6 73.1 40.6% 37.7% 93%
Europe 207.5 280.3 27.0% 28.4% 105%
EU 144.8 288.5 18.9% 20.4% 108%
Non-EU 62.6 263.1 8.2% 8.0% 98%
North America 95.6 274.0 12.5% 12.9% 104%
South America 69.6 175.2 9.1% 9.1% 100%
Africa 53.3 49.7 6.9% 6.0% 86%
Central America 20.4 127.6 2.7% 2.2% 81%
Oceania 9.4 254.7 1.2% 3.8% 311%
World 767.4 108.7 100.0% 100.0% 100%
Source: own calculations based on FAO Food Outlook June 2013.
24
24
4.2.1. Growth consumption in South America, Asia and Africa

The regions Asia, South America and Africa have seen rapid growth in consumption. However, within these
continents, per capita consumption differences between countries can be identified. Strongest growth has
occurred in South America. Per capita consumption in this region increased by 27% in the period 2005-2012.
Brazil, Colombia and Venezuela particularly contributed to this increase. India, China and Indonesia were
responsible for the greatest increase in Asia (+22%). Algeria, Kenya and Egypt contributed most to the
increase in Africa (+16%).
Development per capita consumption in fast-growing countries per region

(2012 compared to 2005)
South America Asia Africa
Brazil +26% India +24% Algeria +38%
+13% +39% +24%

Colombia China Kenya
2012 2012 2012
2005 +28% 2005 2005
+62% Indonesia +26%
Venezuela Egypt
South + 27% +22% +16%

Asia Africa
America
0 50 100 150 200 250 0 30 60 90 120 150 0 50 100 150 200 250
kg kg kg
)
Source: own calculations based on FAO Food Outlook.
4.2.1.1. Effects of rising income and urbanization
Rising income and urbanization are factors that have encouraged growth in dairy demand in developing
countries. Urbanization stimulates improvements in infrastructure, including cold chains, which permit trade
in perishable goods like dairy. Compared with the less diversified diets of the rural communities, city dwellers
have a more varied diet. With more modern diets for example through the fast food sector, and policies to
encourage milk consumption, differences in per capita milk consumption between countries tend to narrow
globally.
4.2.1.2. South America
The dairy consumption of South American countries is halfway between the developing and developed
regions, because of the high level of urbanization (around 80%). This is especially true in the last decade in
Brazil, Venezuela and Colombia with economic growth boosting local milk production and demand for dairy
products. Due to the increasing middle class and rapid changes in diet and lifestyle, demand for nutritious,
convenient products has been increasing. This provides dairy companies with significant opportunities. The
degree of foreign investment has ensured an influx of capital and technology that has lifted the dairy industry
in South America to a higher level. A remarkable increase is that of the Venezuelan per capita dairy
consumption, which has increased by 62% in the period 2005-2012. This country has the largest proven oil
reserves in the world and has benefited from historically high international oil prices over the past decades,
which have had a positive effect on the local purchasing power. The milk production costs in most South
American countries are among the lowest in the world and that makes this region attractive for sourcing milk
in the future.
25
25
Per capita dairy consumption, GDP per capita and urbanization rate (2005 2012)
kg Brazil Urban population GDP per capita

200 100 (% of total) (current USD) 20 000
160 90 16 000
120 80 12 000
80 20: 157 164 175 70 8 000
Page 139 141 151 145 152
40 60 4 000
urbanization GDP
0 Main mergers finalized in50the dairy sector in 2012 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
In Europe
kg Venezuela Urban population GDP per capita

120 merged with
90 16 000
90 80 12 000
60 128 70 8 000
108 112
95 95 95
79 78
30 60 4 000
Germany Great Britain urbanization GDP
0 50 0
Turnover (2011): 965 mln USD Turnover (2011/12): 1 bln USD
2005 2006 2007 2008 2009
1.3 bln2010
kg of2011
milk in2012
2011 2005
1.18 2006
bln kg 2007
of milk in 2008 2009 2010 2011 2012
2011-12
In
kg Colombia
the United States
Urban population GDP per capita
160 90 8 000
120 80 6 000
80 146 141 145 +156 166 163 161 164 + 70 = 4 000
Madison (Wisconsin)
40 Manitowoc (Wisconsin) 60Brookfield(Wisconsin) 2 000
2 300 farms 2 650 farms 500 farms urbanization GDP
0 50 0
2005 2006 2007 2008 Source:
2009 2010 2011 2012
CNIEL, 2005international
company reports, 2006 2007 2008 2009 2010 2011 2012
press.
Source: own calculations based on FAO Food Outlook, World Bank.
4.2.1.3. Asia
Page 26: Fast food in China
The economies of China, India and Indonesia have undergone In recent years, lifestyle changes in
massive growth in the period 2005-2012. The GDP annual growth China have contributed to a
rate averaged between 10 to 20% for these countries. Increased consumer shift from traditional
prosperity and the rapid growth of the middle class led to a significant restaurants towards more western
rise in dairy consumption. Dietary patterns are changing and fast food establishments which also
expanding. With the rural-urban transition, people living in cities serve cheese in their dishes. Higher
consume more fast and more convenience foods, especially in China incomes and urbanization have
where current food consumption patterns are showing signs of increased demand for fast food. Yum!
convergence towards a more Western diet. The per capita Brands inc., owner of the KFC and
consumption of dairy products in India is among the highest in Asia, Pizza hut restaurants chains, already
as dairy products have always been important in the Indian diet. Milk has more than 5 400 KFC and Pizza
is also consumed in high quantity in rural India. The potential for Hut locations. It plans to open 700
future expansion of dairy consumption remains high in these new units in 2013. McDonalds plans
countries, as income levels continue to grow and levels of per capita to increase the number of outlets by
consumption are still relatively low. over 300 to 2 000 in 2013.
26
26
kg China
50 Urban population GDP per capita
70 (current USD)
10 000
(% of total)
40 60 8 000
30 50 6 000
20 36 36 37 40 4 000
32 31 32 33
27
10 30 2 000
urbanization GDP
0 20 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
kg India Urban population GDP per capita

100 40 4 000
75 30 3 000
50 98 103 106 20 2 000
86 87 91 94 94
25 10 1 000
urbanization GDP
0 0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
kg Indonesia Urban population GDP per capita

20 60 4 000
15 50 3 000
10 40 2 000
11 12 13
5 10 10 9 10 10 30 1 000
urbanization GDP
0 20 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
)
4.2.1.4. Africa
On average the per capita dairy consumption in Africa is relatively low. The dairy industry in Africa still faces
challenges, since infrastructure for transportation is often insufficient, and refrigeration and energy are
generally lacking. The continent also experiences sharp fluctuations in milk production during certain
seasons of the year depending on the prevailing weather. A good example is Kenya, a country that faced
huge milk quantity fluctuations in the recent decade. But the situation in Africa is gradually being improved
due to growing investments. The strong economic growth in Africa has been accompanied by the emergence
of a sizeable middle class and a rapidly growing trend towards further urbanization of African cities, which
has propped up the demand for dairy products. In Algeria and Kenya particularly, the urban population has
increased greatly. Milk consumption in Algeria is relatively high compared to other African countries,
because of the high level of urbanization. The country also has a longer tradition of dairy product
consumption.
27
27
kg Algeria Urban population GDP per capita

160 90 8 000
120 80 6 000
80 152 70 4 000
129 140
110 113 106 110 119
40 60 2 000
urbanization GDP
0 50 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
kg Egypt Urban population GDP per capita

100 60 4 000
75 50 3 000
50 40 2 000
72 72 76 80 78 81
65 68
25 30 1 000
urbanization GDP
0 20 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
kg Kenya Urban population GDP per capita

urbanization GDP
100 40 4 000
75 30 3 000
119
50 107 100 105 105 103 103 20 2 000
83
25 10 1 000
0 0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
4.3. Consumption of individual products

Consumption figures in this report are mainly based on balance sheets compiling the apparent consumption
by country. It should be noted that the national figures used for this calculation method are no more than an
indication. Countries where dairy products other than liquid milk, butter and cheese, are popular, like India,
are undervalued, and informal production of milk products is not always included in the data.
The following world maps illustrate the differences in per capita consumption of liquid milk, butter and cheese
between countries. Countries in Northern Europe and Australia have the highest per capita liquid milk
consumption. Western European countries have the highest per capita butter consumption. European
countries together with the United States have the highest per capita cheese consumption.
28
28
Per capita consumption in kg (2012)
Liquid milk (A)
< 30
30 to 60
60 to 90
> 90
Butter
<1
1 to 3
3 to 5
>5
Cheese
<5
5 to 10
10 to 15
> 15
Source: National Committees IDF, USDA, Eurostat.
(A)
May include milk drinks, fermented products.
29
29
5. World Dairy Trade

Important note: the figures in this chapter can differ from the figures in the tables of Annex 3 because different sources and moments of
data collection have been used.
5.1. World trade shows further expansion

(A) (B)
In 2012, world dairy trade , which excludes the EU-intra trade volume, was subject to further growth and
(C)
reached a volume of about 61.9 million tonnes in milk equivalents (+8%). This growth has well exceeded
the annual average since 2000 (CAGR 4%). It reflects the increasing geographical imbalance between
production and consumption of dairy in the world. Trade is needed to fill the gap. For that reason, the share
of world trade in global milk production has slightly risen over the past decade and is now nearly 9%. Still,
this means that the vast majority of the global milk pool is consumed locally and never crosses any borders.
5.2. New Zealand prime supplier, Asia and Africa prime buyers
The strong, overall world dairy trade development was the result of growth in all major product categories,
with cheese, butter and condensed milk showing the highest relative growth. This was fuelled by expanding
exports from all leading exporters, except Argentina. New Zealand contributed by far the most, with double
digit export growth for most commodities. The country thus strengthened its position as the leading global
dairy exporter. Growth in EU exports was mainly based on cheese and condensed milk, while exports of milk
powders, butter and butteroil tended to be stagnant or negative. Remarkable export expansion was achieved
by Belarus, who, after several sluggish years, appears to have found its way up to becoming a prime
supplier of the Russian market and sometimes beyond.
Export share (D) development of key exporters on the world dairy market
(milk equivalent basis, period 2000-2012)
19%
New Zealand 22%
27%
28%
39%
EU 27 26%
26%
26%
5%
USA 9%
12%
12%
16%
Australia 11%
7%
7%
2%
Belarus 3%
4%
4%
3%
Argentina 5%
4%
4%
16%
24%
Rest of world 20%
19%
0% 10% 20% 30% 40% 50%

2000 2005 2011 2012
Source: PZ, Comtrade.
(A)
In this chapter, world dairy trade is defined as the global export volume minus the EU 27 intra-trade volume: volumes are based on
total trade flows of the following commodities: butter and butteroil, SMP, WMP, condensed milk and cheese.
(B)
EU is defined as the EU 27 territory. In 2012, the volume of EU-intra trade of said commodities amounted to 38.3 million tonnes (or
38% of total global trade volume).
(C)
In the analysis, conversions of product volumes into milk equivalents are based on the non-fat solid content methodology.
(D)
As part of total world trade volume: reference volumes used were (expressed in million tonnes): 2000: 38.2 / 2005: 43.9 / 2011: 57.4 /
2012: 61.9.
30
30
The picture of 2012 reconfirmed that, from a supply point of view, the international dairy market remains
rather concentrated and thus vulnerable, with the top-6 suppliers covering no less than 80% of the worlds
total export volume. Meanwhile, demand remains more fragmented. Growth opportunities in the dairy market
are increasingly being determined by developments in China and regions like Middle East, South East Asia
and (northern) Africa. Meanwhile, net interaction of Central and South America with the global dairy market
tends to remain limited, as a result of intra-regional sourcing developments.
5.3.Trade volume development by product category

5.3.1. Cheese
In 2012, cheese continued to be one of the favorite dairy commodities. World trade stepped up to more than
2.4 million tonnes, again well ahead of the previous years level (+10%). The top-3 cheese exporters all
expanded their trade volumes substantially, covering well over half of the world trade volume. The global
cheese market is characterized by the fact that several of the leading producing and exporting countries are
also among the worlds largest cheese importers, like EU, USA, Australia and Switzerland.
Top-10 leading global exporters Top-10 leading international markets

Share in Annual
Market volume development 11/12 (%); position of
(x 1 000 tonnes) 2012 world growth
top-5 exporters
trade (%) 11/12 (%)
EU 27* 774.4 31.6 +14.2
Russia +12%
Germany 146.1 6.0 +13.5
Netherlands 127.6 5.2 +23.8 Japan +7%
France 99.9 4.1 +3.0
USA +7%
New Zealand 300.5 12.3 +22.2
USA 260.0 10.6 +15.9 Mexico +21%
Australia 162.9 6.7 -2.8 Saudi Arabia -12%
Belarus 143.3 5.9 +17.3 South Korea +11%
Egypt 75.1 3.1 -58.3 EU 27 -0% EU 27
New Zealand
Ukraine 67.5 2.8 -15.9 Australia
Australia +2%
Switzerland 62.4 2.5 +4.2 USA
Switzerland +4% Belarus
Argentina 54.1 2.2 -8.1 Other countries
Venezuela +39%
Uruguay 47.1 1.9 +1.2
World trade 2 448.5 100.0 +9.7 0 100 200 300 400 500
1 000 tonnes
*intratrade excluded
31
31
World trade: dynamics in main export markets of top-5 cheese exporters

(Top-5 export markets per exporter > 10 000 tonnes. Development 2011/12 as indicated in %)
Switzerland
+4%
Canada Russian Federation

+19%
+3%
+25% +17%
EU Belarus South
-1% Korea Japan
USA
+43% China
Saudi
+36% Algeria +15% Arabia +13%
+12%
Mexico +6%
+3%
+9%
+27%
-1%
+32%
+174% Australia
New Zealand
5.3.2. Butter and butteroil

After several weak years, world trade in butter and butteroil rebounded to its highest level in years. Sales
from market leader New Zealand and from Australia soared, to a wide range of markets. Belarus boosted its
exports to Russia, ousting more and more EU exporters from that market. Still, the five major exporters
represented more than 86% of world trade, which illustrates the bias towards concentration in supply in this
market.

Share in Annual
top-5 exporters
trade (%) 11/12 (%)
New Zealand 451.0 51.1 +12.4
Russia +26%
EU 27* 122.6 13.9 -0.8
France 31.0 3.5 +11.6 Iran +30%
Netherlands 24.1 2.7 -9.7 Egypt +31%
Finland 17.8 2.0 +12.4
Belarus Saudi Arabia +18%
85.2 9.7 +37.8
Australia 53.8 6.1 +29.9 China +26%
USA 48.7 5.5 -23.6 USA +45%
Uruguay 31.0 3.5 +74.5 EU 27 -43% New Zealand
Argentina EU 27
20.5 2.3 -21.8 Azerbaijan +38% Belarus
Switzerland 11.3 1.3 +19.3 Australia
Morocco +6%
India USA
6.9 0.8 -33.3
Singapore +5% Other countries
Russia 4.2 0.5 +112.8
World trade 882.4 100 +10.3 0 40 80 120 160 200
1 000 tonnes
32
32
World trade: dynamics in main export markets of top-5 exporters of butter/-oil

-4%
Russian Federation
+40%
Belarus
EU
USA
China
Iran
Egypt Saudi
Mexico Arabia
Vietnam
+27%
+25%
+26%
+55% Australia
-44%
+42%
New Zealand
5.3.3. Whole milk powder (WMP)

In 2012, world trade in non-skim milk powder (WMP) stepped up by 8%, reaching another record level of
nearly 2.4 million tonnes. This was mainly due to New Zealands expansion, which strengthened its position
as the main supplier in this market. China played a key role in this. The country absorbed more than one
third of New Zealands exports and now represents almost 20% of the world market. Another remarkable
export grower is Belarus. While mainly targeting Russia, it also exports substantial volumes to Venezuela.

Share in Annual
(x 1 000 tonnes) Market volume development 11/12 (%); position of
2012 world growth
top-5 exporters
trade (%) 11/12 (%)
New Zealand 1 235.4 52.5 +14.3
China +38%
EU 27* 387.8 16.5 -0.6
Netherlands 130.1 5.5 +2.7
Venezuela +6%
Denmark 75.7 3.2 -14.1 Algeria -12%
Belgium 38.1 1.6 -27.6
UAE +30%
Argentina 200.5 8.5 +0.7
Australia 109.3 4.6 -5.9 Nigeria -0%
Uruguay 60.0 2.6 +3.1 Saudi Arabia +2%

New Zealand
Belarus 33.9 1.4 +26.8 Sri Lanka -13% EU 27
Philippines 21.2 0.9 -52.2 Argentina
Brazil +20%
Australia
USA 20.9 0.9 -3.4 Oman +5% Uruguay
Chile 15.0 0.6 +6.5 Malaysia +2% Other countries
Costa Rica 11.7 0.5 -24.7
0 100 200 300 400 500
World trade 2 351.8 100.0 +7.9
1 000 tonnes
33
33
World trade: dynamics in main export markets of top-5 WMP exporters

EU
+6% +19%
China
-20% Libanon
U.A.E.
Algeria +40%
-25%
Oman
+6% Sri Lanka
Venezuela Nigeria
-18%
Brazil
+54% Angola -4%

+6% +38%
-1% -1%
Australia
Singapore
-5% -12%
Uruguay
+3%
Argentina -8%
New Zealand
5.3.4. Skim milk powder (SMP)

World trade in skim milk powder expanded further to almost 1.8 million tonnes, though growth curbed down
from previous years double digit levels (+6%). Exports by both EU 27 and USA, which together still cover
more than half of the market, showed below average growth. Growth came more from Oceania and Belarus,
destined for various markets in Asia, some in Africa and Russia. Surprisingly, the largest contribution to
export expansion came from India, where a post-ban recovery materialized in significant regional exports.

Share in Annual
top-5 exporters
trade (%) 11/12 (%)
EU 27* 523.0 29.1 1.0
Mexico +14%
Belgium 108.9 6.1 -8.2
France 108.4 6.0 13.0 China +16%
Germany 107.4 6.0 3.4
Indonesia +8%
USA 444.7 24.8 2.1
377.8 21.0 8.0 Algeria -9%
New Zealand
Australia 168.6 9.4 20.6 Philippines -6%
Belarus 75.9 4.2 37.6 Russia +42%

India 34.4 1.9 > 1 000 Malaysia +5% EU 27
USA
Uruguay 33.0 1.8 16.4
Vietnam +7% New Zealand
Ukraine 26.2 1.5 17.5 Australia
Egypt +29%
Switzerland 15.7 0.9 9.2 Belarus
Thailand -5% Other countries
Argentina 14.1 0.8 -23.1
World trade 1 795.4 100% 5.8 0 60 120 180 240 300

1 000 tonnes
34
34
World trade: dynamics in main export markets of top-5 SMP exporters

Russian Federation
Canada
+56%
+1%
EU Belarus
USA
+10% China
-27% +65%
Saudi +30%
+13% Egypt Arabia
Mexico Algeria
+35% Thailand
Philippines
Malaysia Vietnam -9%
-29% +103%
-42% -7% +44%
-12% Indonesia
+81%
-30%
+59% Australia
-9%
Singapore +2%
+18%
New Zealand
5.3.5. Whey powder and whey products

(E)
World trade in whey powder and whey products continued its dynamic development in 2012, stepping up
to a volume of 1.5 million tonnes (+6%). This business remains dominated by exports from the EU and the
USA, which determine growth and represent two thirds of total world trade. Growth came on a wave of
demand from China originally, but also because of opportunities in many other markets in the Asian region
and elsewhere. After the United States, it was Belarus that expanded its export volume the most, mainly
destined for Russia.

Share in Annual
top-5 exporters
trade (%) 11/12 (%)
EU 27* 545.9 35.2 +3.8
France 160.5 10.3 +3.5 China +4%
Netherlands 84.5 5.4 -14.7 Indonesia +8%
Poland 73.7 4.8 +9.4
Russia +19%
USA 490.1 31.6 +5.7
New Zealand 101.9 6.6 +14.4 EU 27 +13%
Belarus 71.2 4.6 +53.2 Malaysia +4%

Switzerland 69.2 4.5 +10.2 Mexico +5%
Argentina 64.6 4.2 -6.5 USA +6% EU 27
Australia 44.6 2.9 +46.0 USA
South Korea -2% New Zealand
Canada 34.5 2.2 -16.9 Belarus
Japan -5%
Uruguay 28.7 1.8 -3.3 Switzerland
Philippines +23% Other countries
Ukraine 24.5 1.6 -7.3
World trade 0 100 200 300 400 500
1 551.0 100.0 +6.3
1 000 tonnes
(E)
This study includes (non-liquid) products under HS 0404: whey powders as well as whey based (protein) products.
35
35
World trade: dynamics in main export markets of top-5 whey products exporters
Switzerland
+11%
Canada Russian Federation
-6% +49%
+3%
EU South
USA Korea
China Japan
-15%
+4% +2% -10%
Mexico
Thailand
Malaysia Vietnam
+7%
+15%
+37%
Indonesia
+10%
+4%
New Zealand

Page 36:
South Americas position in world dairy trade

The export of leading dairy exporting countries in South America like Argentina, Uruguay, Chile and Brazil
has shown a variable picture over the years. Their common export share in world dairy trade over the past
decade has remained limited, varying between 4 and 7%, with no indication of any structural increase so
far.
Despite the growth in available export over the years, generally speaking, the net interaction of South
America with the world dairy market beyond the Latin American continent remains limited. The reason for
this is that most growth in demand around the region so far has been met by supply from within the region
itself. Though Argentina is known for its position in the WMP market and may regularly appear with
substantial volumes on established export markets like Algeria, most of its WMP stays within the region.
Overseas exports thus remain restricted to specific product categories and markets. An example of this is
the butter export from Argentina and Uruguay, 80% of which goes to destinations outside the region,
especially to Russia. Furthermore, more than 60% of Argentinean whey products nowadays go into Asia
and the Middle East (compared to 17% seven years ago). Another exception which confirms the rule of
localness is the export of condensed milk, which includes substantial trade flows from both Brazil and Peru
to destinations in Africa.
36
36
6. Prices
6.1. Dairy market prices

6.1.1. Market situation 2012
Over the course of 2012, dairy commodity markets changed from supply driven softening, started in the
second half of 2011 and extending well into the first quarter of 2012, to a gradually rising market driven by
supply constraints from the major export producers later on in the year. During the first half of 2012, increase
of milk output on the back of risen milk prices slowly translated into an increase in exportable supplies, which
had been a factor in pressuring prices, experienced during the first half of the year.
Resilient demand from buyers in South East Asia, the Middle East and North Africa could have initially
supported market prices. However, the increase in demand was not sufficient enough to soak up the rising
surplus, produced in the export regions. The extra milk was processed into more butter and milk powder, and
stocks started to rise, forcing downward pressure on dairy commodity prices over the course of the second
quarter.
In the first half of 2012, butter prices fell 1 000 USD back to 2 970 USD, SMP and WMP approximately 600
USD and 800 USD to 2 860 USD and 2 800 USD respectively, while cheese prices saw a price correction of
500 USD to 3 600 USD. These price movements were reflected in Global Dairy Trade auction prices as well.
Price developments (A)
SMP
USD per tonne
6 000
5 000
4 000
3 000
2 000
1 000
Jan-12 Apr-12 Jul-12 Oct-12 Jan-13 Apr-13 Jul-13
GDT-price Oceania USA
WMP
USD per tonne
6 000
5 000
4 000
3 000
2 000
1 000
GDT-price Oceania EU
(A)
GDT-price: weighted average bid price. Oceania, USA and EU: information collected from trades, offers to sell and secondary data.
As EU-WMP is more relevant for export than US-WMP, EU prices are mentioned in the chart for WMP.
37
37
Price developments (continued)
Cheddar
USD per tonne
6 000
5 000
4 000
3 000
2 000
1 000
Butter
USD per tonne
6 000
5 000
4 000
3 000
2 000
1 000
Source: GDT, USDA
Mid-year, markets were relatively quiet in the cross-over between Northern and Southern Hemisphere
production seasons, but concern was growing about possible surplus milk from the EU and the US.
However, a change of view came as expectations in terms of milk production growth slowed more and more
in Europe as well as in the United States, initially caused by a combination of severe drought and high feed
prices.
The turnaround began in September 2012 as drought conditions in the US significantly cut production
expectations. Stock levels were also relatively low in the Northern Hemisphere. Therefore there was little
buffer available to absorb any reduction in supply, which instead was directly reflected in prices.
Commodity prices accelerated during September, driven by fears of a supply shortage occurring, but with a
good start to the season in New Zealand, and with most buyers well covered for the immediate future term,
market advance stagnated during the month of November.
Buyer resistance was felt at higher prices in some markets. In-market stocks appeared to be at sufficient
levels to cover immediate needs in many markets. This was especially the case for the markets that typically
source their supplies from Oceania. Many of these countries imported higher levels of product than normal
during the third quarter as New Zealand exporters pushed out their end-of-season stocks. In general,
demand remained quiet as market forces had been very balanced during the latter part of 2012 and early
2013, and movement in commodity prices was very minimal.
38
38
Page 39:
What
WhatisisGlobalDairyTrade?
GlobalDairyTrade?
GlobalDairyTrade
GlobalDairyTradeis isananauction
auctionplatform
platformforforinternationally-traded
internationally-tradedcommodity
commoditydairydairyproducts.
products.Established
Established
bybyFonterra
Fonterrainin2008,
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Sinceitsitslaunch,
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Despite the surge in prices during September/October, butter prices ended the year 13% down at 3 290
USD, both SMP and WMP were down 1% and 9% at 3 400 USD and 3 330 USD respectively, while cheese
prices remained quite stable at 4 000 USD.
Page 42:
World dairy trade continued to expand during 2012 and dairy trade growth amounted to 8% compared to
2011. Good export availabilities and a rise in value of the euro against the US dollar since July led to several
Therises,
price LTOasInternational Milkto Price
exporters were able Comparison
compensate (www.milkprices.nl)
for the weakening of the dollar.
compares prices paid for milk by large European dairies. These producer
prices are made comparable for milk with a standard
Exchange composition (4.2% fat
rate development
and 3.4% protein), quality and an annual delivery of 500 000 kg.
USD/EUR
Page 43: USD
1.40
1.36
End of EU quota
1.32
The end of the EU quota system in 2015 has led to some interesting developments regarding the
payments systems1.28for milk in Europe.The abolition of milk quotas will mean that buyers of milk will
want to reach agreements with their farmer suppliers to a greater extent about the expected milk
1.24 started to ask their suppliers to estimate in advance how much milk they will
supply. So many dairies
supply during the year and/or even specified per month. Some dairies pay a premium to dairy farmers
who have correctly1.20
estimated their supply.
Other dairies started to manage the volume by a two price system. For a determined percentage of
USD/NZD
the producers quota an A-price is paid and for the rest of the milk supplied a - mostly lower - B-price
is paid. When the A and
USDB prices depend on the market prices for end products for example, the B
price is based on the market prices for commodities like butter and skim milk powder and the A-price
0.90
for more value added products the B-price is not always lower than the A-price.
0.87
Another interesting development is fixed milk prices to cover the risk of major milk price fluctuations.
For example Irish Glanbia
0.84 offers contracts where dairy farmers receive a fixed price for a part of their
milk, while New Zealand Fonterra started a pilot on this in 2013.
0.81
0.78
0.75
Source: ECB
4
39
39
6.1.2. Developments 2013

Although commodity prices were already tracking steadily upward at the start of 2013, due to supply
constraints in the main dairy producing regions, - such as a prolonged winter period and a late spring in
Europe - declaration of drought on New Zealands North Island pushed some commodity prices up further.
In March, when the severity of New Zealands drought took the markets by surprise, dairy commodity prices
surged ahead on the global market and reached levels not seen since late 2007. Both SMP and WMP leapt
up by more than 50% to 5 400 USD and 5 500 USD respectively. The sharp rise in Global Dairy Trade
auction prices, particularly for deferred deliveries, was a clear sign of expected tightness in future supplies.
In the first half of 2013, butter prices recovered 800 USD to 4 100 USD, SMP and WMP approximately 1 000
USD and 1 500 USD to 4 500 USD and 4 880 USD respectively, while cheese prices were least affected by
the surge in international prices for milk products, and saw a modest price increase of 300 USD to 4 300
USD.
Limited growth in milk production so far, combined with reduced in-market supplies and continuing strong
demand will lead to uncertainty over sufficient future availability of milk products. Against this backdrop,
international prices are expected to remain at elevated levels until at least the latter part of 2013.
However there is a better supply outlook, as the Southern Hemisphere production season may develop
positively on the back of higher milk prices, and lower feed costs and favorable weather conditions could
hold off potential buyers in anticipation of lower prices over the course of the first quarter of next year. This in
turn is increasing pressure on the level of international market prices.
6.2. Milk producer prices

6.2.1. Year 2012
In 2012 in most countries producer prices for milk fell compared with 2011. This is illustrated in the table
below with average producer prices for milk of the worlds largest dairy producing countries.
Average producer prices for milk (USD/100 kg)
Country 2011 2012 % change

Brazil 48.19 42.82 -11.1%
India 42.10 38.46 -8.6%
China 54.00 57.22 +6.0%
EU 27 47.31 41.97 -11.3%
USA 44.31 40.79 -7.9%
New Zealand 57.82 46.36 -19.8%
Source: IDF National Committees, European Commission.
Notable are the huge differences in producer prices for milk ranging from 88.11 USD in Japan to 33.32 USD
per 100 kg in Ukraine as illustrated in the map below.
40
40
Average producer prices for milk
30-40 USD/100 kg 50-70 USD/100 kg
40-50 USD/100 kg > 70 USD/100 kg
Source: IDF National Committees, European Commission, AMI.
Milk prices increase more in emerging countries (BRIC Brazil, Russia, India and China) than in the more
developed dairy economies such as the EU, United States and New Zealand. The graphs below illustrate
this showing the milk price developments in the BRIC countries respectively, EU 27, United States and New
Zealand.
Development of producer prices for milk in BRIC countries

(national currency, 2007=100)
Index
250
210
170
130
90
50
2007 2008 2009 2010 2011 2012
Brazil Russia
India China
Source: IDF National Committees, AMI.
41
41
Development of producer prices for milk EU 27, USA and New Zealand
(national currency, 2007=100)
Index
200
Page 39:
170
What is GlobalDairyTrade?
GlobalDairyTrade is an140
auction platform for internationally-traded commodity dairy products. Established
by Fonterra in 2008, GlobalDairyTrade has become the leading price reference indicator for products
110
traded. The auctions, which are referred to as trading events, are run twice a month by the Trading
Manager, CRA International, Inc.
80
Since its launch, several big international dairy companies have registered to sell some of their products
50
via GDT. While it has brought some level of transparency, Fonterra only sells approximately 30% of its
product supply this way. This2007 2008 the other
means that 2009 70% 2010 2011
could represent 2012
other value, dependent on
contracts concluded with other potentialEUbuyers.
27 Face-to-face
USA negotiation
New Zealanddoes not generate the same
results as an auction. The real market is often more sluggish - both upstream and downstream. Moreover,
the system is not able to avoid the increasing volatility in todays market.
Source: IDF National Committees, European Commission.
As New Zealand exports 90% of its milk, producer prices for milk in New Zealand are a good indicator for
world market prices. In the LTO International Milk Price Comparison milk prices paid by large European
dairies are compared with milk prices paid by Fonterra. The graph below - based on the LTO International
Milk
PagePrice
42: Comparison - shows milk prices paid in western Europe and New Zealand tend to converge.
The
The LTO
LTO International
International Milk
Milk Price
Price Comparison
Comparison (www.milkprices.nl)
(www.milkprices.nl)
compares
compares prices
prices paid
paid for
for milk
milk by
by large
large European
European dairies.
dairies. These
These producer
producer
prices
prices are
are made
made comparable
comparable for for milk
milk with
with aa standard
standard composition
composition (4.2%
(4.2% fat
fat
and
and 3.4%
3.4% protein),
protein), quality
quality and
and an
an annual
annual delivery
delivery of
of 500
500 000
000 kg.
kg.
Page 43:
Development of EU LTO milk price and New Zealand milk price
EUR per 100 kg

End of EU quota
50
payments systems for milk in Europe.The abolition of milk quotas will mean that buyers of milk will
want to reach 40
agreements with their farmer suppliers to a greater extent about the expected milk
supply. So many dairies started to ask their suppliers to estimate in advance how much milk they will
30
who have correctly estimated their supply.
Other dairies started

20 to manage the volume by a two price system. For a determined percentage of
is paid. When the A and B prices depend on the market prices for end products for example, the B
10 the market prices for commodities like butter and skim milk powder and the A-price
price is based on
0
2000 2002 2004 2006 2008 2010 2012
For example Irish Glanbia offers contracts where dairy farmers receive a fixed price for a part of their
EU New Zealand
Source: LTO International Milk Price Comparison.
42
42
the system is not able to avoid the increasing volatility in todays market.
Page 42:
6.2.2.
The LTO Year 2013
International Milk Price Comparison (www.milkprices.nl)
compares prices paid for milk by large European dairies. These producer
Basedareonmade
prices the development
comparable forof the
milk EU
withLTO milk price
a standard comparison
composition and fat
(4.2% the positive expectation of New
Zealands
and Fonterra
3.4% protein), for the
quality 2013/14
and milkdelivery
an annual price year, a relatively
of 500 000 kg. strong increase of milk prices is foreseen for
2013. In the first 6 months of 2013 EU LTO milk prices were 5% higher compared to the same period in
2012. In its most recent forecast Fonterra expects a farm gate milk price of 7.80 NZD per kg milk solids. If
Page 43:
this price holds to the end of the milk price year it will be a new record, as the former record was 7.60 NZD
per kg milk solids in 2010/11.
End of EU quota
payments systems for milk in Europe.The abolition of milk quotas will mean that buyers of milk will
want to reach agreements with their farmer suppliers to a greater extent about the expected milk
supply. So many dairies started to ask their suppliers to estimate in advance how much milk they will
who have correctly estimated their supply.
Other dairies started to manage the volume by a two price system. For a determined percentage of
is paid. When the A and B prices depend on the market prices for end products for example, the B
price is based on the market prices for commodities like butter and skim milk powder and the A-price
For example Irish Glanbia offers contracts where dairy farmers receive a fixed price for a part of their
43
43
7. Dairy Outlook
The OECD (Organisation for Economic Co-operation and Development) and FAO (Food Agriculture
Organization of the United Nations) have been jointly publishing an agricultural outlook every year over the
last decade. These studies are not supposed to predict the future, but provide a perception of the future
shown at a given moment. The present economic situation may influence this projection process. Needless
to say, building a ten-year outlook is not exactly the same exercise when performed during the course of a
crisis period (2009) or during a bonanza time (2007 and 2011).
The yearly updating of this outlook is certainly influenced by the current economic situation, but not solely. It
also takes into account slow and regular structural changes. The purpose of this chapter is to analyze the
successive outlooks published by OECD and FAO over the last few years, and to try to comprehend if the
perception of the dairy sector, beyond the short term, is evolving, and if so, in what way.
7.1. Milk production

FAO and OECD assessments of world milk production development have hardly changed over the last few
years. Between 2009 and 2013, their estimate of annual average growth at world level over a ten-year period
ranged from 1.7% to 2.2%. Likewise, development has remained invariably stronger in developing countries
(2.5% to 3.2%) than in developed ones (0.9% to 1.2%).
However, a few countries present significant changes over this period. Today the FAO and OECD are much
more positive about milk development in Saudi Arabia and Ukraine than before. On the contrary,
assessment is less positive than it used to be for China, Russia and Algeria.
Projections of milk production annual growth rate (%)
Projections done in 2009 2010 2011 2012 2013

for the 10-year period 2009-2018 2010-2019 2011-2020 2012-2021 2013-2022
World 1.74 2.18 1.93 1.97 1.78
Developed countries 0.92 1.17 1.07 1.18 0.98
Australia 1.84 1.63 1.18 1.20 1.03
EU 27 0.31 0.35 0.35 0.54 0.34
New Zealand 2.15 1.51 2.31 2.41 1.46
Russia 1.67 1.54 1.27 1.59 0.96
Ukraine 0.76 1.32 1.36 1.22 1.79
USA 1.10 1.18 1.40 1.59 1.57
Developing countries 2.56 3.16 2.76 2.71 2.50
Algeria 4.17 2.50 2.24 2.00 2.34
Argentina 2.86 3.10 2.88 3.43 2.69
Brazil 1.72 2.28 1.66 1.75 1.67
China 3.60 4.75 3.30 2.46 2.38
Egypt 2.87 3.17 2.57 1.47 2.65
India 2.88 3.06 2.87 3.37 2.85
Iran 2.19 1.92 2.39 2.23 1.74
Mexico 0.81 1.15 0.84 0.54 0.58
Pakistan 2.08 4.13 3.28 1.95 2.60
Saudi Arabia 2.11 1.92 2.16 2.35 5.24
Turkey 2.68 2.75 3.06 2.22 2.60
Source: FAO, OECD.
44
44
7.2. Dairy product consumption

Between 2007 and 2013, the pattern of world consumption development for butter, cheese and whole milk
powder has not really changed. Levels of consumption have been upgraded but only slightly, and slope
curves for each product have remained rather similar. On the other hand, outlook for skim milk powder
consumption has been significantly modified. The newly buoyant demand observed in 2011 and 2012 led the
OECD and FAO to consider that annual growth rate will be, on average, significantly higher for 2013-2022
(+1.9%) than assessed previously in 2011 for 2011-2020 (+1.3%).
Projections of dairy product consumption

mln tonnes Butter mln tonnes Cheese
14 24
2013-2022 2011-2020
13 23
2013-2022
2011-2020
12 22
2007-2016
11 21
2007-2016
10 20
9 19
07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22
mln tonnes Skim milk powder mln tonnes Whole milk powder
5.0 6.0
2013-2022 2013-2022
4.5 5.5
4.0 5.0
2011-2020
2011-2020
3.5 4.5
2007-2016 2007-2016
3.0 4.0
2.5 3.5
07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22
Source: FAO, OECD.
With the exception of cheese, total dairy product consumption is nowadays higher in developing countries
than in developed countries. According to the last agricultural outlook published by OECD and FAO, the
share of developing countries in global consumption may well grow over the next few years for all kinds of
dairy products. Between 2013 and 2022, this share will climb for butter (from 63% to 67%), cheese (from
23% to 25%), skim milk powder (from 54% to 56%) and whole milk powder (from 88% to 89%). This trend is
undoubtedly linked to the leadership taken over by emerging countries in terms of world wealth growth over
the last few years. This comes with an increase in the standard of living in these areas and a fast growing
development of households belonging to the middle class, who can afford to buy more costly food than
grains, such as fruit, vegetables, meat and dairy products.
45
45
Projections of dairy product consumption for the 2013-2022 period

mln tonnes Butter mln tonnes Cheese
9 20
Developing countries
8 Developed countries
16
7 12
6 8
5 4
Developed countries
4 0
13 14 15 16 17 18 19 20 21 22 13 14 15 16 17 18 19 20 21 22
mln tonnes Skim milk powder mln tonnes

Whole milk powder
3.5 6
3.0 5
2.5 4
2.0 2
Developed countries
Developed countries
1.5 1
1.0 0
13 14 15 16 17 18 19 20 21 22 13 14 15 16 17 18 19 20 21 22
Source: Page
FAO, 46:
OECD.
The tremendous
The tremendous growth
growth of
of global
global middle
middle class
class in
in emerging
emerging countries
countries
World demand
World demand is is increasingly
increasingly coming
coming from
from emerging
emerging economies,
economies, notably
notably India
India and
and China. According to
China. According to the
the
OECD, the
OECD, the global
global middle
middle class
class could
could comprise
comprise 33 billion
billion additional
additional people
people by
by 2030,
2030, coming
coming mainly
mainly from
from Asia.
Asia.
As aa consequence,
As consequence, IndiaIndia and
and China
China are
are going
going to
to progressively
progressively overtake
overtake the
the United
United States
States and
and Europe
Europe in in
terms of demand for consumer
terms of demand for consumer goods.goods.
Size of
Size of the
the global
global middle
middle class
class
bln people
bln people 4.9
4.9
55 7%
7%
44
3.2
3.2
7%
7% 66%
66%
Africa && Middle
Africa Middle East
East
33
Asia Pacific
Asia Pacific
Central && South
Central South America
America
1.8
1.8 Europe
Europe
22 54%
54%
8%
8% North America
North America
28%
28%
8%
8% 6%
6%
10%
10%
11 Middle class:
Middle class: all
all people
people living
living in
in households
households
36%
36% 22%
22% 14%
14% with daily
with daily per
per capita
capita income
income ofof between
between 10
10
and 100
and 100 USD
USD inin terms
terms of
of PPP.
PPP.
18%
18% 10%
10% 7%
7%
00
2009
2009 2020
2020 2030
2030
Source: OECD.
Source: OECD.
46
46
7.3. Dairy product prices

FAO and OECD have considerably upgraded their outlook for agricultural product and food prices over the
last few years. This upgrading concerns dairy products but also feedstuffs (cereals and oilseed meal) given
to cows. As a consequence, dairy farmers are expected to receive better returns over the next few years, but
also to face higher feed costs, which makes it difficult to perceive the extent to which margins on dairy farms
will evolve.
This upgrading of agricultural prices is the consequence of two major convictions. First, as mentioned earlier,
unless a health or economic crisis lingers, world demand for dairy products is expected to be steady in the
coming years, because of the impressive economic development in emerging countries. Second, most
forecasters consider that food supply may not be able to easily satisfy this growing demand since climate
change and resource exhaustion (water, fossil energy, new arable land) may not allow the leaps in
productivity enjoyed during the last few decades.
Projections of commodity and dairy product prices on the world market

USD per tonne Wheat USD per tonne Oilseed meal
350 500
2013-2022
300
2013-2022 400
2011-2020
250 2007-2016
2009-2018
2011-2020 300
200
2009-2018
2007-2016 200
150
100 100
07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22
USD per tonne Butter USD per tonne Cheese

5 500 5 500
2013-2022
4 500 4 500
2011-2020
2011-2020
3 500 3 500
2013-2022 2007-2016
2009-2018
2 500 2 500
2009-2018
2007-2016
1 500 1 500
500 500
07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22
USD per tonne Skim milk powder USD per tonne Whole milk powder
5 500 5 500
4 500 4 500
2013-2022
2013-2022
3 500 3 500
2011-2020
2007-2016 2011-2020
2007-2016
2 500 2 500
2009-2018
2009-2018
1 500 1 500
500 500
07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22
Source: FAO, OECD.
47
47
7.4. Dairy Trade

In their last annual agricultural report, OECD and FAO considerably changed their perception of dairy trade
development. They consider that it may grow much faster in the coming years than was thought in the
previous issues. This is particularly the case for cheese and skim milk powder, whose current trade volume
and slope curves for the coming decade were considerably upgraded.
Projections of world dairy trade

1 000 tonnes 1 000 tonnes
Butter Cheese
1 100 3 500
2013-2022
1 000 3 000
2013-2022
900 2 500
2007-2016
2011-2020
800 2 000
2011-2020 2007-2016
700 1 500
600 1 000
07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22

Skim milk powder Whole milk powder
2 500 3 000
2 000 2 700
2013-2022
2013-2022
1 500 2 400
2007-2016
2011-2020 2007-2016 2011-2020
1 000 2 100
500 1 800
0 1 500
07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22 07 08 09 10 11 12 13 14 15 16 17 18 19 20 21 22
Source: FAO, OECD.
The speeding up of dairy trade is the consequence of the fast-growing demand in emerging countries which
exceeds the development of local dairy production and processing. As a consequence, developing countries
are expected to significantly increase their global net deficit for all kinds of dairy products over the next
decade.
Projections of the growing dairy product deficit for the 2013-2022 period in
developing countries
mln tonnes
2.5
Whole milk powder

2.0
Skim milk powder

1.5
1.0
Cheese
0.5
Butter
0.0
13 14 15 16 17 18 19 20 21 22
Source: FAO, OECD.
48
48
8. World Dairy Market Forum
8.0. Contents
8.1. Japanese Dairy Industry page 50
8.2. The Latin American Dairy Chain page 54
8.3. Overview on Milk Prices and Production Costs World Wide page 62
8.4. Dairying in the EU - A New Paradigm? page 69
8.5. Managing Milk Price and Feed Cost Volatility in the United States page 76
49
49
8.1. Japanese Dairy Industry

By Toshio Nomura, Agriculture and Livestock Industries Corporation, Japan
8.1.1. Introduction
Japan is not a traditional dairying country. Commercial dairy farming commenced during the Meiji era (1868-
1912), however it began to develop in earnest during the years of high economic growth from 1954 onwards.
This report will present an overview of the development, current situation and characteristics of the Japanese
dairy industry.
8.1.2. The start of commercial dairy

During the Meiji era, the Western lifestyle gradually penetrated into Japan and milk and dairy products were
introduced to people. Initially, milk was recognized as a precious and nutritious drink which was beneficial for
sickly people. In order to provide milk, a few small dairy farmers and milk processors emerged in the
outskirts of big cities such as Tokyo and Yokohama. Therefore, in Japan, unlike in traditional Western
dairying countries, dairy farmers and milk processors emerged almost simultaneously as modern business
partners to sell drinking milk. From the outset, milk processors positively assisted and trained dairy farmers
in order to collect more milk and expand their business.
8.1.3. Rapid development since 1954

The dairy industry began to develop properly during the years of high economic growth from 1954 onwards.
That year, the Japanese government introduced the Act on the Promotion of Dairy and Beef Cattle
Production in order to support industry development. Since then, the Japanese dairy industry has rapidly
developed, especially in Hokkaido where more sufficient domestic feed supply was available than in other
prefectures (To-fu-ken). Key industrial data since 1960 are presented in the table below. In 1996, milk
production recorded 8.6 million tonnes which exceeded that of New Zealand and Australia. In 2011, milk
yield per cow increased to 8 034 kg which was 11th among leading world dairying countries. Cows per farm
increased to 44.4, a similar level to advanced Western dairying countries such as France and Germany.
Rapid and successful development of the dairy industry, despite being one of the non-traditional dairying
countries in Eastern Asia, is an important characteristic of Japan.
Development of Japanese dairy industry (A)
Year Farm Total Herd Milk production Milk Dairy Milk

cattle size Japan Hokkaido Yield import Consumption
('000 (cows per (1 000 (% of national (kg per (1 000
('000) head) farm) tonnes) production) cow) tonnes) (kg per capita)
1960 410 824 1.1 1 887 21.0% 4 010 237 22.2
1970 308 1 804 3.4 4 761 24.9% 4 398 561 50.1
1980 115 2 091 11.2 6 504 32.5% 5 006 1 411 65.3
1990 63 2 058 20.3 8 497 37.4% 6 383 2 237 83.2
2000 34 1 764 34.2 7 720 43.0% 7 401 3 952 94.2
2011 21 1 467 44.4 7 474 51.9% 8 034 4 017 88.6
Source: Ministry of Agriculture, Forestry and Fisheries of Japan.
(A)
Figures in import and consumption columns are based on milk equivalents (meq). Among 5 meq calculation methods presented in
Bulletin of IDF 390, method 1 was applied for butter and cheese and method 4 was applied for SMP, WMP and whey powder with some
modifications.
50
50
8.1.4. Deficiency of domestic feed supply

Due to rice paddy cultivation being dominant in Japan, domestic supply of livestock feed was deficient from
the early stages. This, together with rapid development of the dairy industry, means that the gap between
supply and demand of feed has expanded. As a result, import of feed such as grains and hay has
significantly increased. Consequently, the rapid and successful development of the Japanese dairy industry
has significantly depended on imported feed. Despite their effort to increase domestic feed supply, it is still
below the demand, even in Hokkaido. In To-fu-ken, the shortage of domestic feed supply has been more
serious. On a total digestible nutrients (TDN) basis, the self-sufficiency rate of feed in Hokkaido is 50% and
just 15% in To-fu-ken. This domestic feed supply shortage is another characteristic and challenge of the
Japanese dairy industry.
8.1.5. Current supply and demand situation of milk

The supply and demand situation of milk and dairy products (milk equivalent basis) in 2011 FY is presented
in the following chart. Total demand for milk and dairy products is around 11.5 million tonnes. Domestic milk
production is around 7.5 million tonnes. The balance of 4.0 million tonnes is imported as various kinds of
dairy products. Cheese is the dominant import item which represents 70% of total import. Domestic milk
production has been gradually decreasing after its peak in 1996, having been substituted by increasing
imports. More than 50% of domestically produced milk is processed for drinking purposes. This higher ratio
of drinking milk and lower ratio of dairy products are another characteristic of Japan.
Supply and demand situation of milk and dairy products
Milk and Dairy
(2011Product Supply
Japanese and Year)
Fiscal Demand in Japan (FY2011)
Total demand: 11,550,000 tons (raw milk equivalent)
Domestic milk production: 7,530,000 tons Imports: 4,020,000 tons

(65% of total supply; Hokkaido: 3,890,000 tons, other prefectures: 3,640,000 tons) (raw milk equivalent)
Other Other
prefectures prefectures
For cheese: 500,000 tons nationwide
For other products:
Approx. 20%
Cheese, etc: 2,790,000 tons nationwide

Milk for drinking: For designated
4,080,000 tons nationwide dairy products: For fresh
Other
1,640,000 tons
cream, etc.
Prefecture For milk, milkdrinks,
nationwide 1,250,000
Approx. processed milk, tons
87% fermented milk, etc nationwide
For powdered
60,000 tons nationwide
skim milk,
butter, etc.
Hokkaido
Approx. Ice cream, etc:600,000 tons nationwide
Hokkaido 91%
Hokkaido Approx. 80%
Tariff quota products, etc:
Approx.
390,000 tons nationwide
13%
State trade, etc: 240,000 tons nationwide
Bold frame shows production by other prefectures

Other products is for
domestic consumption
*Number of tonnages are rounded off as 1,000 units
by dairy farms
51
51
8.1.6. Comparison Hokkaido and To-fu-ken
Hokkaido
To-fu-ken
8.1.6.1. Milk production cost
Average milk production cost is higher in To-fu-ken than in Hokkaido. The difference mainly comes from farm
size, feed self-sufficiency rate and farm land price. Most dairy farmers in To-fu-ken heavily rely on imported
feed. Therefore, the rising international market price of feed and devaluation of the Yen seriously affect farm
management.
8.1.6.2. Supply and demand situation
Milk production is continuously increasing in Hokkaido but it is not enough to make up for the decrease in
To-fu-ken. Adding to higher production costs, the urbanization of suburbs is making it difficult to expand or
continue dairying in To-fu-ken. As a result, a significant amount of excess milk can be seen in Hokkaido
despite the deficiency in To-fu-ken every year. In order to adjust this unbalance, a lot of raw and packaged
milk is transported from Hokkaido to To-fu-ken every year. Two huge cargo ships exclusively used for milk
transportation operate almost every day.
8.1.6.3. Farm gate price of milk
In Japan, most dairy farmers sell their milk via farmer cooperatives. As the price of drinking milk is higher
than that of other dairy products, cooperatives prioritize drinking milk sales. In To-fu-ken, they have a great
advantage in terms of location for selling milk for drinking purposes (milk, yoghurt and other milk beverages).
Conversely, in Hokkaido, they have to sell most milk for producing dairy products such as butter, skim milk
powder and cheese. As a result, there is an obvious difference in the farm gate price between To-fu-ken and
Hokkaido.
Farm gate price of milk
Yen/10 kg
Fiscal Year Hokkaido Other prefectures National average
(To-fu-ken)
2007 694 881 792
2008 767 926 848
2009 801 1 002 902
2010 771 992 880
2011 794 1 002 897
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52
8.1.7. Dairy companies in Japan

Meiji, Yukijirushi Megmilk, Morinaga and Yotsuba are the top four dairy companies in Japan. Of these
companies, Yotsuba is the only one owned by farmers in Hokkaido, the other three are private companies.
The total milk processing amount of the top four represented 53% of national production in 2011 FY. There
are several medium-sized and a lot of small-sized companies. Most of those small companies operate in To-
fu-ken, producing drinking milk, yoghurt and milk beverages. The total number of milk processing factories is
decreasing but around 600 are still running.
Number of milk processing factories
tonnes
milk processing amount/day
Year <2 2 to 40 > 40 Total
2003 401 186 135 722
2008 341 158 123 622
2012 304 142 118 564
8.1.8. Conclusion
The Japanese dairy industry developed in earnest during the years of high economic growth and it has
achieved a similar level to advanced Western dairying countries. Deficiency of domestic feed supply still
remains the challenge to be resolved. There are significant differences between Hokkaido and To-fu-ken in
production costs, supply-demand situation and farm gate milk price. A lot of small milk processing factories
still exist in To-fu-ken.
53
53
8.2. The Latin American Dairy Chain

By Alejandro Galetto, Dairy Cooperatives Association, Argentina.
Important note: the figures in this chapter can differ from the figures in the tables of Annex 3 because different sources and moments of
data collection have been used.
8.2.1. The geographical and economic environment

The Latin American and Caribbean (LAC) region is a group of 33 independent countries (plus more than 15
dependent and overseas territories, most of them small Caribbean islands), with a population of 590 million
people and an area of 20.4 million square kilometers. Both the population and the area are highly
concentrated in a relatively small group of South American countries (Brazil, Argentina and Colombia) plus
Mexico, which account for 67.3% of the population and 70.0 % of the land area.
The total GDP for the region in 2012 was 5 701 billion USD, and the per capita GDP was 9 670 USD, with
(A)
most of the countries in the upper middle income range of 6 to 15 thousand USD per capita .
The region as a whole, and most of the countries located there, has seen an improvement in economic
performance in the last decade. The average change in GDP in the period 1994-2003 was 2.5% per annum
while the average for the period 2004-2012 was 4.0% per annum, even accounting for the disastrous 2009,
with a decrease of 1.9 % in the GDP of the whole region.
Annual change in GDP in Latin America and the Caribbean

%
8
0
1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
-2
Annual change in terms of trade in Latin America and the Caribbean

(2005=100)
index
125
115
105
95
85
75
1994 1996 1998 2000 2002 2004 2006 2008 2010 2012
Source: U.N. Economic Commission for Latin America and Caribbean (ECLAC).
The improved economic performance of Latin America and the Caribbean is mostly due to the changes in
the world economic environment, with the sharp increase in the prices of commodities, which shows itself in
the upward trend in the terms of trade of the region (see graph above). Other indicators also show that the
overall economic and social situation of the LAC regions is today much better than in the nineties. The
inflation rate for example, which averaged 38.5 % in 1995, dropped sharply to 6.2 % in 2012. And the
(A)
The World Bank, World Development Indicators, in: www.databank.worldbank.org.
54
54
external debt, averaging 35 % of the GDP in the period 1990-2003, was reduced to less than 20 % (on
average), in the period 2008-2011.
As we shall see in the following sections, the development of the dairy sector in Latin America and the
Caribbean has kept pace with the overall economic environment, particularly regarding the domestic
consumption of milk products, also as a result of a growing urban population.
8.2.2. Milk production

Most of the milk produced in the Latin American and Caribbean region is of the bovine type (99.3 %), with
(B)
the share of buffalo, sheep or goat almost negligible , and therefore only cow milk will be considered in this
report.
The table below shows the evolution of milk production in the world, for the whole LAC region, and for the
four parts we have divided it into Mexico, Central America, the Caribbean region and South America. It is
estimated that the region accounts for 13.1 % of the world production, while in the years 1991-93 its share
was only 9.6 %. The LAC region has in fact been the second fastest growing milk production region, after
Asia. By region, the table also shows that most of the growth in milk production comes from South American
countries.
Cows milk production in the LAC region, 2010-2012
mln tonnes 2010/12

2010 2011 2012
Region growth
World 596.6 605.6 617.0 +20.4

Latin America and Caribbean 76.2 79.3 81.0 +4.8
Mexico 10.8 10.9 11.1 +0.3
Central America 3.6 3.6 3.6 +0.0
Caribbean countries 1.9 1.8 1.8 - 0.1
South America 59.9 63.0 64.5 +4.6
Source: FAO data (Ecuador production based on national sources).
Within the LAC region the four countries with the largest population (Brazil, Mexico, Colombia and
Argentina), also account for a high share (78.6 %) of total milk production (see table below). Then, there is a
group of six countries (Chile, Venezuela, Uruguay, Ecuador, Peru and Costa Rica) with an annual production
of more than 1 billion litres, and in the remaining 10 countries the production level ranges from 815 million
litres per year (Nicaragua) to 190 million litres per year (Panama).
The source for the milk production data in the table below is FAO, with the sole exception of Ecuador, where
the original source quoted 7 150 million litres for 2012, while other national sources put that number close to
5.8 million litres per day (2 130 million litres for the year).
(B)
At world level, the production of bovine milk accounts for only 82-83 %.
55
55
Milk production in 2012 and estimated number of dairy farms
Milk production Dairy farms

Country
( mln tonnes) (estimated)
Brazil 33 070 1 350 000
Argentina 11 493 11 700
Mexico 11 111 259 000
Colombia 7 600 395 000
Chile 2 710 12 000
Venezuela 2 481 43 000
Uruguay 2 200 4 600
Ecuador 2 131 302 000
Peru 1 820 100 000
Costa Rica 1 014 14 400
Nicaragua 815 120 000
Honduras 700 67 000
Cuba 600 300 000
Paraguay 517 12 000
Guatemala 490 25 000
Dominican Republic 480 68 000
Bolivia 450 11 000
El Salvador 400 55 000
Jamaica 191 250
Panama 190 6 500
Total 80 463 3 156 450
(C)
Source: FAO data and FAO-FEPALE (2012 ).
The right column of the above table shows the estimated number of dairy farmers for each of the 20
countries. Needless to say it is a rough estimation, obtained from different published and unpublished
sources. In some countries, such as Brazil for example, 420 thousand dairy farmers do not produce for the
(D)
market . Overall, it is estimated that in the region of Latin America and the Caribbean there are 978
thousand non-commercial dairy farmers (in the sense that they only produce for family consumption).
Differences aside, the numbers indicate that the importance of dairy farming in many countries of Latin
America and the Caribbean goes beyond its economic weight as it has critical social dimensions for rural
development and employment and also for food security.
Although statistical information is not available, there are three basic types of production systems in the
region, which can be described as:
1. specialized, Holstein-based;
2. specialized, with other breeds;
3. double purpose (milk and beef).
The specialized Holstein systems can be divided further according to the relative importance of pastures in
the overall dietary needs of the herd, ranging from mostly pasture-based to confinement systems, where
most or all the ration fed is in the form of silage, hay and concentrates.
The pasture-based, specialized, Holstein systems are the dominant form of production in the temperate
regions of Argentina, Chile and Uruguay, in parts of southern Brazil (in the states of Ro Grande do Sul,
Santa Catarina and Paran), and they also prosper in other countries as well, such as in the highlands of
Ecuador, Colombia and Costa Rica, to mention the most relevant cases. However, in the last few years,
(C)
FAO FEPALE. 2012. Situacin de la lechera en Amrica Latina y el Caribe en 2011 Observatorio de la Cadena Lechera. Oficina
Regional de la FAO para Amrica Latina y el Caribe, Divisin de Produccin y Sanidad Animal.
(D)
Zoccal, R., Costa de Oliveira, O, y M. T. Almeida (2011). Cuntos so os produtores de leite no Brazil?. Embrapa, National Dairy
Research Center and IBGE, Brazilian Institute of Geography and Statistics, unpublished report, 8 p.
56
56
most of these regions have witnessed a sustained process of intensification, with an increased
consumption of concentrates which has led to the development of confinement systems (or semi-
confinement), particularly important in the segment of the larger producers.
The specialized, non-Holstein, systems (for example, with crosses with Cebu breeds like Gir, or Brown
Swiss), have developed in the subtropical regions of Brazil, Colombia, Venezuela and Central America
mostly. Also, it is in these regions of Latin America and the Caribbean, characterized by high levels of
temperature and humidity, where the typical double purpose, milk and beef systems, can be found.
The figure below shows the farm gate milk price for a group of countries which account for 85 % of milk
production in the region. Argentina has the lowest price in the region, with less than 0.40 USD/litre, while all
the other countries are currently (in the first months of 2013) within the range of 0.40 0.50 USD/litre.
Farm gate milk prices in a group of Latin American countries

USD per 100 litre
0.60
0.48
0.36 2010
2011
0.24 2012
2013
0.12
0.00
Argentina Chile Uruguay Mxico Per Brasil Costa Colombia
Rica
Source: Argentina (MAyP), Chile (Odepa), Uruguay (INALE), Mxico (Sagarpa), Peru (Minagri), Brazil
(Cepea), Costa Rica (CNPL) and Colombia (Fedegan).
These prices are the result of a combination of different factors. For example, in Argentina, Chile and
Uruguay, it is the exposure of these countries to foreign trade, together with the structural features of their
sectors plus the effects of domestic policies (particularly in Argentina).
8.2.3. Trade in dairy products

The following table shows the evolution of imports and exports of dairy products in the Latin American and
(E)
Caribbean region, measured in milk-equivalents , compared with the figures for total world trade, as
compiled by FAO.
(E)
Conversions of product volumes into milk equivalents are based on the total solids content methodology .
57
57
Trade in dairy products (in milk equivalents) as a % of world trade, 2010-2012.
Region Imports Exports

2010 2011 2012 2010 2011 2012
World (1 000 tonnes) 46 386 49 623 53 700 47 250 49 745 53 730
Latin America & Caribbean 12.3% 13.6% 15.5% 7.3% 8.4% 8.1%
Mexico 4.6% 5.0% 4.9% 0.4% 0.3% 0.2%
Central America & Caribbean 3.9% 3.9% 3.4% 0.8% 0.9% 0.7%
South America 3.8% 4.7% 7.1% 6.1% 7.2% 7.1%
Source: Own calculations with FAO data.
This table shows an increase in the participation of the LAC region in world dairy trade in the last three
years, particularly on the import side. Overall, the region is a net importer of dairy products, with an
aggregate deficit of about 4 billion litres of milk-equivalent per year. Within the region, Mexico, Central
America and the Caribbean are net importers while South America is a net exporter of dairy products.
However, even in this latter case, the exporter countries are those in the southern cone of South America,
while Venezuela and Brazil are net importers (see following two figures).
The ten countries with the larger imports of dairy products (figure directly below) account for 88 % of the total
imports of the region, while the exports are more concentrated, since the ten major exporters account for 98
% of the total exports of the region. Moreover, two of them, Argentina and Uruguay, are responsible for 75 %
of the exports of dairy products from Latin America and the Caribbean.
Main importing countries of dairy products in the LAC region

(milk equivalents, 2012)
1 000 tonnes
3 000
2 400
1 800
1 200
600
Source: FAO.
58
58
Main exporting countries of dairy products in the LAC region

1 000 tonnes
2 500
2 000
1 500
1 000
500
Source: FAO.
8.2.4. Domestic consumption

The consumption of dairy products in Latin America has a long tradition and it is a key component of the
daily diet, particularly cheeses (of different types). The figure below shows the main 20 countries of the
region in terms of per capita consumption of dairy products, measured in litres of milk-equivalent per year.
Uruguay is the country with the highest level of per capita consumption (245 litres/yr), followed by Argentina
(212 litres/yr) and Costa Rica (199 litres/yr). The weighted (by population) average per capita consumption
for the 20 countries is 145 litres/yr (2012).
Per capita consumption of dairy products

litres
300
240
180
120
60
Source: Panamerican Dairy Federation (FEPALE) and FAO data.
59
59
In line with the improvement of incomes and their distribution, many LAC countries have experienced an
impressive growth in the consumption of dairy products. Perhaps the most striking case is Brazil, which went
from a consumption level of 106 litres per capita in 1990 (with a population of 150 million) to 176 litres per
capita in 2012 (with a population of 198 million), thus producing a growth rate of 3.6 % per annum. In
absolute value, the increase in consumption was almost 19 billion litres, equivalent to the whole production
of New Zealand.
8.2.5. Dairy processing industry

Approximately 72 % of the milk production of Latin America and the Caribbean goes through the
manufacturing sector (FAO-FEPALE, 2012, op. cit.), which is about the same proportion reported by IDF for
the world as a whole. In some countries such as Argentina, Uruguay, Chile, Panama and Mexico, the
proportion is well above 80 %, while in the countries of Central America (with the exception of Costa Rica),
Ecuador and Colombia the share of manufactured milk is below 50 %.
One distinguishing feature of the dairy economy of Latin America and the Caribbean is the small size of the
dairy companies, compared with other parts in the world, as it is shown in the figure, below, with the ranking
(F)
of the 20 largest non-foreign dairy companies , measured by their milk intake.
The dark blue columns are for cooperatives, the light blue columns represent companies whose ownership is
shared between dairy farmers and private investors (Lala and Alpura in Mexico, and Itamb in Brazil), and
the rest are private-investor companies.
Largest non-foreign dairy companies of Latin America (by milk intake, 2012)
mln litres
2 000
Private Cooperative
1 600
Private/dairy farmers
1 200
800
400
Source: Industry estimates and unpublished data.
This group of 20 companies has a total intake of 17.3 billion litres per year, about the same as DFA and well
below Fonterra, to put the numbers in perspective. Moreover, when the largest dairy companies in the world
are grouped together, their combined intake is 162.8 billion litres per year, ten times larger than the Latin
American companies.
(F)
For example, companies like Nestl, Fonterra, Saputo and Bongrain, to mention a few, are not ranked.
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Regarding the production of dairy products, just a few countries publish detailed statistics for dairy
manufacturing and therefore it is difficult to produce aggregate figures for the region as a whole. However,
some general patterns emerge, such as the low share of fluid (pasteurized and UHT) milk (less than 20 % in
most of the countries) and the high share of cheeses (more than 35 %).
8.2.6. Conclusions
The milk economy plays a key role within the agri-food chains in many countries of Latin America and the
Caribbean, not only because of its economic weight but also for its importance in rural development and food
security.
The pace of milk production growth in the region has been among the fastest in the world, second only to
Asia, and LAC is positioned to develop a vibrant dairy sector in the foreseeable future. In some cases,
playing an exporting role, while in others the chain will evolve towards improved forms of domestic provision
of milk for an increasing consumption of a growing urban population.
From a competitive perspective, the region has the overall advantage of the availability of a large natural
resource base, which allows the production of milk at prices which are among the lowest in the world.
However, the relatively small size of the dairy companies of Latin America in comparison with the rest of the
world will be a key issue for the coming years, since it may hinder the ability of the regional dairy chain to
keep up with the world dairy market.
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8.3. Overview on Milk Prices and Production Costs World Wide

By Torsten Hemme, Asaah Ndambi, Eva Schrer-Merker, IFCN Dairy Research Center, Kiel, Germany.
8.3.1. Introduction
Milk production worldwide is practised by around 122 million dairy farms (IFCN estimate) keeping 363 million
milking cows and buffaloes. This means that the worlds average farmer keeps 3 milk animals with an
average annual milk yield of approximately 2 100 kg/animal/year. Of course, building averages is an
oversimplification. There is a wide range of dairy farms in the world keeping less than 3 cows per farm on the
one hand and on the other hand in some countries, dairy farms are much bigger and keep over 1000 cows
per farm.
The simple example shows that milk production is performed distinctively in different countries and their dairy
regions. The dairy farming systems differ significantly in terms of farm size, housing, milking and feeding
systems. This article follows the approach of the International Farm Comparison Network (IFCN). It is a
global network of dairy researchers from 95 countries. The network focuses on analysing dairy farming
systems and their milk production costs. It is coordinated by the IFCN Dairy Research Center (DRC) at CAU
University Kiel Germany (www.ifcndairy.org).
8.3.2. Milk and feed prices development 1996-2013

The graphs below describe the development of the world market prices for milk and feed. The world milk
prices are based on the weighted average of 3 IFCN world price indicators: skim milk powder & butter (35%);
cheese & whey (45%) and whole milk powder (20%). The IFCN world feed price indicator represents the
world market price level for feed. The calculated feed price indicator is based on the price for a diet
comprising 70% corn (energy feed) and 30% soybean meal (protein feed). The milk : feed price ratio
indicates how much feed a dairy farmer receiving global milk prices and paying global feed prices can buy,
after selling one kg of milk. The ratio is defined as favorable, when it is >=1.5 and in general one can
conclude that the higher the ratio, the more favorable intensive feeding is considered.
Besides this commonly used ratio, IFCN has developed a new farm economic indicator. This is the margin
over compound feed costs. This indicator assumes an average feed intensity of 300 g compound feed per
1 kg milk. This feed intensity could represent a farm with a milk yield of 8 000 kg milk / cow and year using
2.4t of compound feed per year. The key improvement is that the milk: feed price ratio is weighting milk and
feed price changes 1 to 1 where the margin indicator is weighting the feed price based on the kg compound
feed fed per kg milk.
World milk prices for milk and feed 1996 June 2013
Source: IFCN.
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At the beginning of the year 2006, the milk price indicator started showing rollercoaster behaviour of
increasing prices and reached a peak of 53.7 USD/100 kg ECM (energy corrected milk 4% fat, 3.3% protein)
milk in November 2007. However, the increase in milk price was not significantly associated with the feed
price, as the gap between the two prices increased in 2007 reaching 32.3 USD.
In 2008, milk price fluctuated strongly and fell from a high level of 50.2 USD/100 kg ECM milk in January
2008 to a low level of 19.3 USD/100 kg ECM milk in February 2009. Nevertheless, the price increased to a
level of 41.7 USD at the end of year 2009, making it a year of high fluctuations and a comparatively low
average price. In 2010, the peak price was 41.3 USD and the amplitude of price fluctuation was lower than
for the two previous years.
In contrast to the milk price, the feed price increased at the end of 2010 and beginning of 2011, reaching a
level of 31 USD/100 kg feed. In contrast to the feed price, the milk price followed a downward trend reaching
37.3 USD in April 2012. The redemption of milk prices began in January 2013 with the level of 40.2
USD/100. The high acceleration of the milk price increase led to it overtaking the historical price peak of
November 2007 and it ended the Q1-2013 with the level of 55 USD/100 kg in April.
Following the prices of milk and feed, it is easy to observe the three main events. The rollercoaster period
between January 2007 and January 2010, which was determined by a high fluctuation of prices (max range
34 USD/100kg ECM) and the milk: feed price indicator between 2.9 and below 1.0. It quickly led from a very
profitable situation in production to a negative margin over compound feed, which decreased well below the
average of 29.2 USD. This phenomenon especially affected milk producers who are based on the more
intensive compound feeding systems like the United States and countries in the EU.
The second period was a period of relative stability which lasted for 2 years between January 2010 and
January 2012. In this time, the milk price and feed price followed almost the same trend, allowing dairy
farmers to produce milk with a milk : feed ratio below the long term average from the end 2010, but still
around 1.5, and on the other hand to keep a positive margin over the compound feed cost which was higher
than the average. This example shows that two different indicators can give different messages. From the
IFCN perspective, the margin over compound feed indicator better describes dairy farm economics, since it
considers the feed intensity.
The third scenario started to develop at the beginning of 2012 when milk prices dropped and feed prices
rose towards new highs until the middle of the year. This impact had a very negative effect on dairy farm
economics as the two indicators (milk : feed price ratio and margin) show.
Starting in August, we saw a sharp rise in milk prices and a decline in feed prices until mid-2013. Both farm
economic indicators show a positive development.
Here the margin indicator is the better indicator to track dairy farm economics. It clearly shows that dairy farm
economics are reaching a similar level as seen in 2007, as soon as dairy farmers receive a milk price which
is rising in line with the world market price. This analysis has been done for a moderate intensive dairy
farming system of, for example, 8 000 kg/cow and year. For farming systems which operate at a lower milk
yield and lower use of compound feed per kg milk, the fluctuation of the margin over compound feed is much
lower and nearly only influenced by milk price developments. On the other hand dairy farming systems with
much higher milk yields and higher compound feed use can show much more volatile margins, especially
when exposed to world market prices.
8.3.3. Cost of milk production 2012 by world region

The annual IFCN work of comparing typical farms around the world has been an on-going process since the
year 2000. Since then, the number of countries participating has increased from 8 to 51. Moreover, the
number of dairy farm types analyzed has increased from 21 to 178.
The IFCN methodology applied for data collection, economic analysis and results validation uses the three
elements:
a network approach of research continuously co-operating,
the concept of typical farms described below and
a standard model TIPI-CAL (Technology Impact Policy Impact Calculation model) to ensure
technical comparability of indicators.
A typical farm represents the most common production system which produces a significant proportion of
milk in a country or a region. Usually, two farm types are used per dairy region the first represents an
average farm and the second a larger farm type. The typical farms were built and validated by a combination
of accounting statistics and a panel of dairy experts. The data collection and validation were done by
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researchers in the represented countries, researchers in the IFCN Dairy Research Center and also during
the IFCN Dairy Conference held in June 2013 in Turkey.
ECM correction: As the dairy farms operate with milk of very different fat/protein content, the IFCN uses the
energy correct milk (ECM) approach to standardise milk volumes to 4% fat and 3.3% protein. The following
formula was used: ECM milk = (milk production * (0.383 * % fat + 0.242 * % protein + 0.7832) / 3.1138).
Cost indicator: The IFCN uses the indicator cost of milk production only which can be directly related to a
milk price. This cost includes all costs from the profit & loss account of the farm. From this cost level, the
non-milk returns from sales of cull cows, heifers, calves, manure, etc. and also returns from coupled direct
payments have been deducted. Furthermore, also the opportunity costs for own labour, land and capital are
included. For creation of the world map, the average size farm from each country was used.
Cost of milk production in average sized farms per country in 2012
No data
Source: IFCN.
In the figure above a simplified global overview on costs of milk production is shown. The illustration is based
on the results of the typical average sized farm analyzed per country in 2012. The results can be
summarised as follows:
Cost range: Cost of milk production ranges from 4 USD per 100 kg milk in extensive farming systems in
Cameroon (where beef is the major output and milk is a side product) to 128 USD for an average sized farm
in Japan. The average cost over all countries analyzed was 46 USD/100 kg milk.
Low cost regions: Based on the average sized farms, three low cost regions have been identified: a)
Argentina, Peru and Uruguay b) Central and Eastern Africa c) Central and Eastern Europe. Some selected
countries in Asia (except Japan and large farms from China) also have low costs.
Western Europe: The leading farms in Western Europe had costs ranging from 40 55 USD. On an
average, the cost in Western Europe decreased by 1.1 USD in 2012 compared to 2011 mainly due to the
weakening of the Euro to the USD.
The United States: The small farms in Wisconsin and New York had a cost of 50 USD. Within the United
States, the large farm from California had the lowest cost of about 33 USD. In general, the average costs of
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all typical farms analyzed in the United States did not change and stayed at a level of 41.4 USD in 2012
compared to 2011(41.02 USD).
Oceania: The cost level in Oceania was about 35 USD.
The CEEC: The average of all household farms from the CEEC witnessed a slight decrease in costs, also
driven by devaluation of the local currencies to the USD.
In the year 2012, the increase of the cost of milk production (in national currency terms) continued in most
dairy farms in the world following a rise in price of major input items (feed, labour and land) in many
countries. But contrary to the year before, these higher input costs were not counteracted by a higher milk
price quite the reverse, the milk price stayed stable or even decreased in many countries leading to
worsening farm economics.
8.3.4. Cost of milk production developments 2000 2012

The results shown in the graphs below reflect the situation of a typical average sized dairy farm from New
Zealand. In the year 2012, this farm type had 348 cows and represented over 50% of the milk produced in
New Zealand. In this time frame, the size of the typical average dairy farm had increased from 220 to 348
cows per farm. The milk yield increased from 4 000 to over 4 500 kg milk ECM / cow in that year. Besides
the costs in NZD, the exchange rate as an index and the costs in USD are shown.
Cost of milk production in New Zealand for a typical average size dairy farm
(2000 2012)
Source: IFCN.
In USD terms, milk production costs almost tripled in the time frame 2000 2012. The costs increased from
12 USD per 100 kg milk in 2000 to a level of over 35 USD in 2011. Cost reduction in 2012 was an effect of
very good weather conditions and related to the improved milk production per ha.
The increase of costs in USD can be explained by the increasing cost per kg milk in NZD which showed an
increase of 52%. This was driven mainly by rising prices for land and labour which increased by 150%. As
dairy farmers in New Zealand do not use purchased compound feed that much, the rising world feed prices
did not affect the milk production costs. The second driver was the appreciation of the NZD to the USD. In
the year 2000, the exchange rate was 2.2 NZD per USD. In the year 2012, this rate dropped to 1.24 NZD per
USD. This was an appreciation of the NZD by 44%. For agriculture, appreciating currencies means
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increasing costs in the currency used for comparison. The example of the year 2008/2009 shows the rapid
devaluation of the NZD decreased milk production costs in USD. During this time, the exchange rate was
fluctuating between 1.3 1.9 NZD / USD.
The graphs below illustrate the costs of milk production of selected typical farms the IFCN had been
analysing over a certain period of time. The first two letters of the farm describe the country. The numbers
describe the farm size in number of cows per farm. The codes after the number illustrate the region, e.g. WI
represents the region of Wisconsin in the United States. Technical comment: The costs for the farm CN-340
have been indexed backwards in the years 2000 2005, using IFCN based on feed prices and technical
progress on the farm.
Cost of milk production 2000 2012 of typical dairy farms in 6 countries

USA, Germany, Poland Argentina, New Zealand, China
Source: IFCN.
Cost developments for the typical farms 2000 2009
Germany (DE-106N): This typical farm with 106 cows represents approximately 60-70% of milk production
in Northern Germany. In the year 2000, the costs were with 28 USD / 100 kg milk, similar to a US dairy farm.
From 2000 2006, the cost increased towards 42 USD per 100 kg milk. The key driver was the appreciation
of the euro (+36%) and moderate increase of costs in euro terms. In the year 2007, a significant increase of
the costs indicator was observed as direct payments were decoupled from the dairy enterprise and lowered
the non-milk returns by 7 USD per 100 kg milk. From 2008 2012, the costs showed a declining trend
towards 42 USD per 100 kg milk. The key drivers were a) a devaluation of the euro by 14% and b) the effect
of the typical farm in the quota exit phase increasing farm size from 80 to 106 cows. These two effects have,
in USD terms, over-compensated for the effect of higher feed and energy prices.
Poland (PL-65): This farm type represents a larger family farm type in Poland, producing about 30-40% of
the total milk in Poland. This Polish farm had very low costs in 2003 and 2004 and was almost as cost
competitive as dairy farms in New Zealand. After joining the EU, costs increased from 17 USD to 53 USD per
100 kg milk in 2008. This was driven by an increase of wages, land prices and an appreciated currency
against the Euro. This increase could not been compensated by an increasing farm productivity. After 2008,
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the farm type followed a similar cost trend as the German dairy farm. The 20% reduction in costs in 2012
was a result of the devaluation of the Zloty (-7%) and improvements in farm efficiency like milk yield, land
and labour productivity.
The United States (US-500WI): This farm type represents a larger family farm type and roughly 30% of milk
in the United States. In the United States, costs were relatively stable from 2000 to 2006 as inflation driven
change of input prices could be compensated by increasing milk yields. Once feed prices started rising, this
had a direct impact on these farm and costs, which increased by 50% to a level of 38.5 USD per 100 kg milk.
The sharp drop in costs in 2009 can be interpreted as a result of very bad milk prices, when farmers tried to
cut costs wherever possible. Until the year 2012, cost had increased mainly driven by feed prices - towards
44 USD per 100 kg milk. US dairy farms had a significant cost advantage over larger family farms in
Germany for over 10 years. In the year 2012, the costs were on a similar level.
China (CN 340): This typical farm with 340 cows represents a larger farm type in China but not the very
large farms. We estimate that this farm type represents 30-40 % of the milk produced in China. The costs on
Chinese farms rose steadily from 2000 to 2005, following increases in feed and labour prices. Since 2006,
an additional increase in cost due to the appreciation of the Yuan could be seen. In 2012, the Yuan had
gained value by + 25% to the USD compared to 2000. The costs on Chinese farms did not drop sharply in
2009 as was observed in most other countries, because the drop in prices in national currency was almost
fully compensated by the appreciation of the Yuan. From 2010 until 2012, the rising feed prices were a
strong driver for increasing cost of production.
Argentina (AR-170): This farm represents an average sized farm in Argentina which keeps about 40-50% of
the cows. The costs of a 170-cow farm in Argentina have more than doubled since 2002. Nevertheless, the
positive trend has slowed in the last 5 years and costs have become more volatile. After a cost decrease in
2011, an increase could be experienced again in 2012. This latest development was mainly driven by a
decrease in milk yield due to unfavorable weather conditions.
New Zealand (NZ-348): The typical farm representing an average sized farm in New Zealand was a cost
leader in milk production in the year 2000. IFCN identified costs of 12 USD per 100 kg milk, which was the
lowest cost level those days. Driven by an increase of input prices and an appreciating currency, costs
increased to a level of 35 USD per 100 kg milk. Based on the typical farms chosen for this analysis, the costs
in New Zealand were approximately 20% higher than in Argentina and ca. 20% below the costs level in the
US and Germany in 2012.
8.3.5. Summary
This article summarises the research work of the IFCN International Farm Comparison Network which has
been analysing dairy farm economics since the year 2000. In the year 2013, over 50 countries participated in
the annual comparison on costs of production and 95 countries participated in the country profile analysis.
The results of this article are summarised as follows:
122 million dairy farms on this planet keeping on average 3 cows per farm
Based on IFCN data collection and estimations, there were 122 million dairy farms and farming households
on this planet in 2012. The average dairy farm size has 3 cows or buffaloes with an average milk yield of
2100 kg milk ECM / milk animal.
Very volatile milk and feed prices - a challenge for dairy farming
Via standardised world milk and feed prices, IFCN tracks the overall farm economic situation for dairy
farming. The IFCN developed an indicator margin over compound feed costs which is a significant
improvement compared to the often used milk : feed price ratio. By using this margin, it becomes visible how
much of a threat dairy farmers face in a situation like in summer 2012, when milk prices fell and feed prices
increased. Within 8 months, this situation changed considerably and dairy farm economics improved
significantly, especially in countries where the high world market prices of milk were transmitted by local
dairies to farmer milk prices.
Costs to produce milk differs significantly the range is from 4 to 128 USD per 100 kg milk
Based on the IFCN cost comparison, 178 typical farms in 51 countries were analyzed. Cost of milk
production ranged from 4 USD per 100 kg milk in extensive farming systems in Cameroon to 128 USD for an
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average sized farm type in Japan. The simple average cost over all countries analyzed was 46 USD/100 kg
milk.
From 2000 2012, cost of milk production increased in all countries analyzed
As the IFCN has analyzed typical dairy farms since the year 2000, a time series analysis was possible. The
results show that costs in a specific country can double or triple within 3-6 years. This is especially the case
for countries like Poland, China, New Zealand where the value of the currency has significantly strengthened
to the USD and farm input price like land, feed, and labour have increased significantly.
Cost of milk production in China is estimated 50% above the level in US and Germany
An extreme case was observed in China where dairy farming highly depends on purchased feed. In addition,
China had the strongest increase in salaries and an appreciation of the currency of 24%. The combined
effect of these factors drove the costs in China to about 50% above the level in US and Germany.
Annual benchmarking a part of strategic dairy development and milk sourcing

In times of significant change in dairy related output prices, farm input prices and exchange rates it is
extremely important to benchmark the competitiveness of the current dairy farming system annually.
Competitiveness means in this sense costs competitive on the market for dairy products and also
competitive on the local market for production factors especially land and labour. Such benchmarking
exercises enable all dairy stakeholders to see and react faster to threats, but even more to anticipate
opportunities which will arise.
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8.4. Dairying in the EU - A New Paradigm?

By Dr Michael Keane, Consultant, and Dr Declan OConnor, Institute of Technology, Cork, Ireland.
8.4.1. Introduction
The OECD-FAO Agricultural Outlook 2012-2020 stated the following:
The dairy industry globalisation, together with domestic and trade policy reforms, have shifted international
dairy markets from a supply driven paradigm, characterized by excess production and depressed world
prices, to a more demand driven paradigm, responsive to market signals and changing consumer
preferences. The sector is increasingly shaped by the prospects of sustained high prices for dairy products.
However, high prices can also have negative consequences for the dairy industry. Under very high prices,
demand may retreat and dairy ingredients can be replaced by cheaper substitutes in food manufacturing.
The higher price Outlook for dairy may also mask that the global dairy sector is increasingly confronted with
higher production costs and what appears to be more unstable market environment; more extreme weather
patterns, rapidly changing macroeconomic situation, input prices and, consequently, increased price
variability.
If sustained higher product prices are matched by similar higher production costs, then production margins
may experience no sustained benefit. This article briefly explores the concept of a new paradigm from an EU
dairy perspective, involving a review of changing EU dairy policy, changing world and EU dairy markets,
trends in EU farm production margins and a brief comment on prices and margins for the decade ahead.
8.4.2. EU dairy policy

Summarising EU dairy policy changes, for the past 30 years the EU dairy sector has been undergoing
fundamental change to accommodate both internal and external pressures. The open ended price support
policy of the 1970s created an internal crisis of very large surpluses which were extremely difficult to dispose
of at reasonable prices creating unacceptable market and budgetary pressures. This led to the introduction
of milk quotas in 1984. The external pressure of GATT/WTO from the mid 1980s onwards led to a
fundamental trade policy shift from a comparatively closed market with a stable target milk price, supported
by variable import levies, export refunds, intervention prices and related measures, to a much more open
market regime of much reduced import tariffs/export refunds, now fixed under international agreement
(WTO) rather than at internal EU discretion, much lower intervention prices with limited and exceptional
intervention and the abandonment of the stable milk target price principle. Farmer support has instead been
primarily directed towards direct income support through the direct payments regime with policy consolidated
under the Luxembourg agreement and the CAP Healthcheck over the last decade. This also includes the
planned elimination of the milk quota regime in 2015.
8.4.3. World and EU dairy markets

World and EU monthly market prices for butter and SMP for the period January 1997 to December 2012,
show that, with regard to world market trends over the past 15 years, it is clear that one can refer to a new
paradigm commencing around 2005. Up to that point world prices for butter and SMP were at best static in
nominal terms, however since 2005 world prices have shown a rising trend generally but have also become
much more volatile (see graphs below). This reflects the fundamental changes in global demand for dairy
commodities led by China and other developing countries, the generally slower response of international
dairy product suppliers and the fundamental policy changes among some of the leading regions including the
EU in particular. It can reasonably be claimed that this represents a new paradigm in terms of world dairy
commodity markets.
With regard to the EU dairy commodities market it is clear that, led partly by the major policy changes arising
from the GATT/WTO agreement (1995) and the Luxembourg agreement (2003) as discussed earlier, there
has been a quite different price level in the EU relative to the world market following the implementation of
the price adjustments of the Luxembourg agreement in particular. In fact there has been almost total
convergence of EU and world market prices at times, reflecting the movement from a rather closed EU dairy
economy in earlier years to a more open global dairy economy in more recent years. The movement from a
fairly separate price pattern for the EU relative to the world market towards a much more aligned pattern is
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reflected in correlation and convergence comparisons for 1997-2004 relative to 2005-2012 (Keane and
OConnor 2013).
(XLS version)
(A)
EU and World Market Monthly Butter Prices (A)
(XLS version) , 1997-2012
EU and World Market Monthly Butter Prices , 1997-2012
EUREU and
per tonne World Market Monthly Butter Prices(A), 1997-2012
5.000
EUR per tonne
5.000
4.000
4.000
3.000
3.000
2.000
2.000
1.000
1.000
0
01-1997 01-1997
07-1997 07-1997
01-1998 01-1998
07-1998 07-1998
01-1999 01-1999
07-1999 07-1999
01-2000 01-2000
07-2000 07-2000
01-2001 01-2001
07-2001 07-2001
01-2002 01-2002
07-2002 07-2002
01-2003 01-2003
07-2003 07-2003
01-2004 01-2004
07-2004 07-2004
01-2005 01-2005
07-2005 07-2005
01-2006 01-2006
07-2006 07-2006
01-2007 01-2007
07-2007 07-2007
01-2008 01-2008
07-2008 07-2008
01-2009 01-2009
07-2009 07-2009
01-2010 01-2010
07-2010 07-2010
01-2011 01-2011
07-2011 07-2011
01-2012 01-2012
07-2012 07-2012
0
NEuropeButter OceaniaButter EUButter
Source: Agra Europe, USDA andPrices,

DairyCo.1997-2012 NEuropeButter OceaniaButter EUButter
EU and World Market Monthly SMP
EUR per tonne
5.000 EU and EU and World
world market
Market monthly SMP Prices,
Monthly SMP prices, 1997-2012
1997-2012
EUR per tonne
5.000
4.000
4.000
3.000
3.000
2.000
2.000
1.000
1.000
0
01-1997 01-1997
07-1997 07-1997
01-1998 01-1998
07-1998 07-1998
01-1999 01-1999
07-1999 07-1999
01-2000 01-2000
07-2000 07-2000
01-2001 01-2001
07-2001 07-2001
01-2002 01-2002
07-2002 07-2002
01-2003 01-2003
07-2003 07-2003
01-2004 01-2004
07-2004 07-2004
01-2005 01-2005
07-2005 07-2005
01-2006 01-2006
07-2006 07-2006
01-2007 01-2007
07-2007 07-2007
01-2008 01-2008
07-2008 07-2008
01-2009 01-2009
07-2009 07-2009
01-2010 01-2010
07-2010 07-2010
01-2011 01-2011
07-2011 07-2011
01-2012 01-2012
07-2012 07-2012
0
NEuropeSMP OceaniaSMP EUSMP
NEuropeSMP OceaniaSMP EUSMP
Source: Agra Europe, USDA and DairyCo.
As well as milk product prices, the convergence towards a single global dairy market can also be illustrated
by a comparison of milk prices of leading EU dairies and that of Fonterra, based on standardised milk price
data (LTO Netherlands International Milk Price Review 2012). Given that the Fonterra milk price can perhaps
be assumed to represent a world market price at farm level, the movement towards EU dairies and Fonterra
milk price convergence since the late 1990s is very clear.
(A)
Wholesale North European (FOB) and Oceania prices as published by the USDA are taken as representative World prices for the
purpose of this study.
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Annual milk price comparison, standardised milk
EUR per 100 kg

50
40
30
20
10
0
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011
EU FONTERRA
Source: LTO Netherland International Milk Price Comparison, Annual Review.
The abandonment of a price stability policy over which the EU itself had almost total discretion, to be
replaced by a much more open global market policy underpinned by international (WTO) agreement, has
coincided with much more volatile dairy market prices in the internal EU market. Extreme price volatility has
become a feature of EU milk and milk product markets in recent years, partly as a result of the major policy
and market developments summarised above. This is apparent in the previous graphs where the
comparative stability of EU butter and SMP prices up to 2005 has been replaced by a much more volatile
market situation with estimates showing that there has been around a threefold increase in price volatility in
both the EU butter and SMP markets between 1997-2004 and 2005-2012.
In conclusion it is clear that, from an EU dairy markets perspective, the post 2005 period also represents a
new paradigm, although in this case it reflects not just the fundamental global changes in demand and
supply but also fundamental policy changes within the EU itself.
8.4.4. EU production margins (B)

While one may recognise a paradigm shift in terms of dairy commodity prices as discussed, if production
costs also rise then production margins may not necessarily show any major change. At EU level the Farm
Accountancy Data Network (FADN) is the primary source of costs and margins as it is based on
comprehensive EU wide harmonised micro-economic survey data. There are a variety of definitions that one
could use to estimate costs and margins, cash costs as % output, total economic costs as % output
(including some imputed costs), costs per litre or per kg milksolids, etc. While all may have a validity
depending on the focus of the undertaking, cash costs as % output is chosen as it best captures the cash
margin available to dairy farmers over time. Given the volatility of market prices as discussed earlier, it is
best to consider longer term trends rather than single year estimates, hence the initial EU comparison is for
2005-2010 versus 1999-2004, with the former period representing the suggested paradigm shift in both
commodity prices and EU policy change as discussed earlier. The results show that, for six leading EU
international dairy trading countries, there has been little change on average in cash costs as % output
between the two periods.
(B)
This section is substantially based on Donnellan et al (2011).
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Cash Costs as % Output
Country A 1999-2004 B 2005-2010 B-A

Germany 80% 74% -6%
France 78% 74% -3%
UK 78% 72% -6%
Netherlands 75% 70% -5%
Ireland 65% 65% 0%
Denmark 88% 94% +6%
Simple Average 77% 75% -2%
Source: Donnellan (2011).
Overall cash costs as % output declined slightly in 2005-2010 versus 1999-2004 reflecting slightly increased
margins, with four of the six countries experiencing a modest average increase in production margins
(decline in cash costs as % output). With regard to 2011 it is estimated that, due to very favorable milk
prices, production gross margins improved by about 10% relative to 2010 for the EU 15, by 12% for the EU
10 and by 13% for the EU 2, (European Comm. 2013) However with the general decline in milk prices in
2012 relative to 2011, production margins in 2012 are likely to have returned to a level closer to 2010.
While cash costs as % output and production margins on average showed little change between the two six
year periods 1999-2004 and 2005-2010, there was however a substantial change in the volatility of margins
between the two periods.
Trends in production margins

Cash Costs as % Output
%
120
100
80
60
40
20
1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010
Germany France UK Netherlands Ireland Denmark
Source: Donnellan 2011.
Hence the conclusion with regard to production margins is that, while there has not been a significant
paradigm shift in the level of production margins in the EU since the global market changes and the
Luxembourg agreement (2003), there has been what one might call a paradigm shift in the volatility of
production margins. This highlights the presence of a new set of problems for producers in terms of coping
with the consequences of much increased volatility. There are a variety of proposed methods of addressing
the production margins volatility problem, both at public policy and private sector levels. At public policy level
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the current European Commission CAP Reform proposals include both a crisis reserve fund and under Pillar
2 an income stabilisation tool which provides for financial contributions to mutual funds to provide
compensation for farmers who experience a severe drop in income. With regard to the private sector there is
already a fledgling development of futures markets for dairy products in the EU which opens up possibilities
for price hedging, forward contracting, insurance/mutual funds products, etc. Given the likelihood of
continuing market volatility it is likely that participation in futures markets will grow steadily over time, just as
in the United States over recent decades. These public and private sector developments should provide
opportunities for all in the dairy supply chain to better cope with the recent phenomenon for the EU dairy
sector of severe market volatility.
8.4.5. Future prospects prices and margins

Future trends for the decade ahead are estimated by agencies such as FAO/OECD and FAPRI who have
developed large econometric models based on sets of assumptions. A brief summary of FAO/OECD future
trends is given in relation to both milk and coarse grains prices (acting as a proxy for purchased feed) for the
decade ahead. The ratio of milk price to coarse grains (purchased feed) price is a fairly good indicator of the
probable trend in dairy margins in many countries over time. For the EU 27 the projections for milk show just
modest movement in the anticipated price of milk to 2021 with a dip in the price in mid-decade followed by a
modest rise in the later decade to about match current prices.
EU 27: price projections to 2021

EUR per tonne
500
400
300
200
100
0
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Milk Coarse Grains
Source: OECD-FAO Agricultural Outlook 2012-2021
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In practice one can anticipate that actual prices will be far more volatile due to the effect of a whole series of
events that cannot be currently anticipated, however the model is only designed to try to capture longer term
patterns rather than short term price volatility. In contrast with the price of milk, the expected price pattern for
coarse grains shows a modest but steady rising pattern from 2014 onwards. Comparing the estimated milk
and coarse grains prices, it is clear that the estimated milk: coarse grains price ratio may decline gradually
from 2013 onwards.
EU 27: price projections to 2021

2012 = 100
index
110
105
100
95
90
85
2012 2013 2014 2015 2016 2017 2018 2019 2020 2021
Milk Coarse Grains
Source: OECD-FAO Agricultural Outlook 2012-2021.
The very tentative conclusion one can draw is that production margins, based on just one cost indicator, may
perhaps decline slightly over time, particularly for those producers who rely on a substantial amount of
purchased feed in the diet. However more positive changes in other milk production cost components and
also productivity change may counteract this somewhat negative estimate.
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References
Donnellan T, Hennessy T, Keane M, Thorne F (2011) International Competitiveness of the Irish Dairy Sector
at Farm Level, Teagasc, Ireland
European Commission (2013) EU Dairy Farms Report 2012 Based on FADN Data, Brussels
Keane M, OConnor (2013) Analysis of the COMAGRI Crisis Dairy Supply Management Proposal, in press
LTO (2012) International Milk Price Review, The Hague, Netherlands
OECD-FAO (2012, 2013) Agricultural Outlook
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8.5. Managing Milk Price and Feed Cost Volatility in the United States
By Dr. Marin Bozic, University of Minnesota, Dr. Cameron S. Thraen, The Ohio State University and John Newton, The Ohio State
University, USA.
8.5.1. Introduction
The objective of this chapter is to illustrate recent developments in farm-level margins in the US dairy sector
with special emphasis on risk management and US dairy policy innovations designed to provide an effective
dairy safety net in times of high and volatile livestock feed prices. The figure below presents milk and dairy
feed prices, as well as Income over Feed Costs (IOFC) dairy margins in the US from 1980 through June
2013. This figure reveals three distinct price regimes. First period, covering 1980-1989, was characterized by
low feed prices and very stable milk prices supported through an active public stock-holding price
stabilization role provided by US federal dairy policy. Once direct milk price intervention was scaled back, a
period of increasing volatility of milk prices ensued, and from 1990 through 2006, the primary source of risk
in the US dairy sector originated on the milk revenue side. Since 2007, volatile milk prices were
accompanied by rising and increasingly volatile feed prices. Coefficient of variation of IOFC margins
increased from 0.12 in 1980-1989, to 0.19 in 1990-2006 to 0.37 in 2007-2013 period.
Dairy IOFC margins in the US, 1980-2013

USD
USD // cwt
cwt
25
25
20
20
15
15
10
10
55
00
1980
1980 1984
1984 1988
1988 1992
1992 1996
1996 2000
2000 2004
2004 2008
2008 2012
2012
IOFC Margins
IOFC Margins Feed Prices
Feed Prices All-Milk
All-Milk Prices
Prices
Source: Bozic et al.
The observed increase in volatility associated with milk price and production feed costs merits a discussion
on several topics. First to be considered is the appropriate measurement for IOFC margins. Second, the role
of private risk markets in providing effective margin risk management for US milk producers is discussed.
And third, we consider the likely policy response in face of these developments.
8.5.2. US dairy IOFC margin

Historically, US dairies were located in geographic areas where land quality presented obstacles to grain
farming due to lower crop yields per acre. In times when grain prices were fairly low, family farms perceived
dairying as a value-added activity that could increase net income per acre. However, since at least 1970s,
innovations in dairy technology and management practices have enabled a new business model to emerge,
one focused not on adding value to existing land base, but in efficiently and profitably converting purchased
livestock feed to milk. The map in the figure below plots the percentage of total feed costs attributed to
purchased feed for 23 major dairy producing states in the US As the figure below reveals, a typical dairy
business model in traditional dairy-producing states such as Minnesota and Wisconsin is characterized by
owning agricultural land and growing most of the feed needs. For these two states, valuing homegrown
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crops at market prices, we find that the purchased feed costs amount to only a third of total feed costs. Ohio,
Michigan, New York are characterized by intermediate levels of forty to sixty percent. In sharp contrast,
purchased feed accounts for 74% of total feed costs in Texas, and 79% in California, production locations in
the US which typify a feed purchase business model.
Purchased feed costs as percentage of total feed costs

Milk production costs and returns per hundredweight, by State (2012)
<40% 40-60% 60-70% >70%
Source: USDA Economic Research Service.
These market-feed oriented dairies are large, often at the technological cutting-edge, and tend to focus their
capital and management efforts on milk production while either outsourcing livestock feed production to
contracted grain farmers or buying commodity feed in the open market. Financial record analysis shows that
the return on assets is substantially higher for this feed purchase milk production business model. However
this business model requires a commodity pricing regime characterized by low and stable feed prices. US
federal feed grain market policy over the period 1980 to 2006 can be characterized as ensuring low and
stable feed grain prices. The post 2006 period can be characterized as one of rapidly escalating feed prices
accompanied by large market price shocks. This shift has eroded the financial advantage for the feed buying
business model and shifted the financial advantage to land owning, feed grain producing, dairy model.
8.5.3. Managing IOFC margin risk

The purpose of a dairy margin risk management program is to effectively smooth IOFC margins across
years. Using private risk markets, this can be achieved through a combination of short dairy futures positions
or put options, to protect the milk revenue side, and forward contracts, long futures positions or call options
on livestock feed commodities such as corn and soybean meal. In the United States, the Chicago Mercantile
Exchange offers a suite of dairy-focused derivatives as well as very liquid grain contracts. However, in order
to understand what would make a risk management program effective, and why, some believe, only a
government sponsored program is required, we need to understand the dynamics of milk production, milk
price behavior and price risk management.
In the long run, competitive markets do not allow for either extra or negative profits. If profit margins are
beyond normal returns to capital and management, existing businesses will expand or new businesses
would enter the market. Likewise, negative profits will lead to reduction in supply through contractions or exit
of some sellers. The above implies that profit margins must be mean-reverting. As Bozic et al. (2012) argue,
dairy IOFC margins in the US are indeed mean-reverting whether current margins are extraordinarily high
or low, forward margins implied from futures prices for milk, corn and soybean meal always revert to the
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long-run average mean. In face of a major shock to margins, such as the one experienced in 2009, it takes
6-9 months for margins to recover, and the term structure of forward margins is found to be quite accurate in
predicting the length of margin recovery. It follows that in order for hedging to be consistently effective in
smoothing dairy IOFC margins, the hedging horizon must be longer than the time needed for supply
adjustments in face of a major shock to margins, that is, futures and options positions must be initiated for a
period that is at least 9 months into the future. In contrast, a producer who waits for a crisis to begin before
locking in margins will likely be unable to avoid a margin slump. Even disciplined risk management programs
which stipulate consistent hedging of production for the forthcoming quarter will have little effect on volatility
of experienced IOFC margins, as hedging horizon of only 3 months is found to be inadequate.
In order for long-run risk management to be practically implementable, deferred dairy futures and options
contracts need to be liquid. However, even after 20 years of trading dairy contracts at the US commodity
exchanges, this liquidity has not been achieved. It is fair to say that the strategy described above, while
employed by a few progressive milk producers, stands little chance of being a solution that can be
implemented on a large scale. Lack of speculative interest and limited use of milk contracts by long hedgers
jointly limit the milk hedging opportunity using the private risk markets. In light of this reality of the
inadequacy of using commodity exchange derivative markets to effectively mitigate price risk, other price risk
management tools have been developed or are proposed for use by the dairy industry in the United States.
These include a quasi-private-public insurance product and a currently debated federal government
sponsored margin insurance program.
8.5.4. Livestock gross margin insurance for dairy cattle

Recognition of the difficulty faced by dairy farmers inherent in using derivative markets as an effective price
risk management tool led to the development of alternatives designed to address these shortcomings. The
first attempt to provide an insurance based safety net as part of the federal dairy policy was the introduction
of the Livestock Gross Margin Insurance for Dairy Cattle (LGM-Dairy) (Gould and Cabrera, 2011). With LGM-
Dairy insurance product, first offered for sale in August 2008, expected milk and feed prices for up 10
months are based on information inferred from CME futures prices for milk, corn and soybean meal and
producers can insure expected IOFC margins averaged over the duration of the insurance contract. The
advantage of LGM-Dairy is that users can define their own quantities of milk, corn and soybean meal they
wish to protect, so the IOFC margin is customized to their particular situation. The risk transferred under
LGM-Dairy insurance policies is born by participating private insurance companies and the U. S. Federal
Crop Insurance Corporation as the reinsurance agent. The USDA manages LGM-Dairy through its Risk
Management Agency, and offers heavy subsidies covering administrative fees as well as up to 50% of
insurance premiums. While LGM-Dairy can be very effective in smoothing IOFC margins, it has in practice
proven to be challenging for dairy producers due to its many choice variables and irregular contract offering.
8.5.5. Dairy producer margin protection program

As a result of the shortcomings of LGM-Dairy, insights from this program have been used in designing an
alternative margin insurance program serving as the basis of the dairy farm safety-net in the US 2013 Farm
Bill. This new dairy margin insurance, called Dairy Producer Margin Protection Program (DPMPP) is
essentially a put option on a national IOFC margin index formula, based on the dairy feed ration developed
by the National Milk Producers Federation with the support of a number of prominent animal nutritionists
(NMPF, 2010). It should be clear from the discussion in the first section of this chapter that any attempt to
construct a single nation-wide index for dairy feed costs and IOFC margins can at best be a rough
approximation that is likely to capture only major turning points in average farm profitability. Nevertheless,
should this legislation be enacted as part of the next US farm bill, this IOFC formula is likely to be used by
both government and private industry analysts as a main measure summarizing a complex issue of dairy
profitability into a single number. Therefore, it is important to understand the derivation of the formula.
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The DPMPP IOFC margin formula, introduced in proposed US federal dairy policy legislation (S.954,
H.R.2642), is defined as:
IOFC margin = U.S. All-milk price $/cwt

1.0728 Corn price $/bu
0.00735 Soybean Meal price $/ton
+ 0.0137 Alfalfa hay price $/ton
where US All-Milk price means the average price received by dairy producers for all milk sold to plants and
dealers in the US; prices of corn and alfalfa hay are taken from monthly United States Department of
Agriculture Agricultural Prices report; and the price of soybean meal is the central Illinois price for soybean
meal as reported in the United States Department of Agriculture Market News-Monthly Soybean Meal Price
Report. The ration is based on nutritional requirements of a cow producing 68.85 pounds of milk per day
during lactation (A).
As a government program, DPMPP has a number of complexities and only a general overview is provided.
To participate in DPMPP producers must sign-up for the margin insurance for an entire calendar year and
choose a per-hundredweight margin coverage level to protect. The program has been very carefully
evaluated and is expected to be highly effective as a catastrophic risk management tool (Newton et al.
2013). However several long-term economic impacts may be anticipated. First, as currently constructed the
DPMPP program may encourage producers to use the new margin insurance program strategically -
transferring to the government losses that are imminent and underinsuring when risks seem remote (Newton,
Thraen and Bozic, 2013). The long term result may be policy-induced increase in milk production and higher
than projected government outlays. Second, positive supply response may reduce average long-run IOFC
margins (Nicholson & Stephenson, 2011). Third, liquidity of private risk markets may decline if producers
substitute this program for more expensive private risk management instruments. Fourth, while the DPMPP
may reduce IOFC volatility experienced by participating dairy farmers, it is unclear what the effect would be
on volatility of cash IOFC margins. If the new program shields producers from market shocks, they will have
less incentive to cut back milk production in times when cash margins are low. As such, supply might take
longer to adjust in face of adverse shocks to IOFC margins and volatility of IOFC margins may actually
increase. Finally, DPMPP, as currently configured, lacks any program participation or indemnity payment
limitations. Without some limiting constraint, a disproportionately large share of DPMPP net indemnities will
flow to the largest dairy producers (Newton, Thraen and Bozic, 2013b). These large scale producers
consistently exhibit higher positive return on assets compared to their small scale competitors and this added
financial advantage will very likely lead to faster consolidation of the US dairy sector.
8.5.6. Summary
Increased volatility in milk prices and feed costs in the United States has resulted in significant financial
stress on dairy farmers over the past decade. This has led to an increased focus on providing, whether
private or public, more effective tools to manage this volatility. This focus has been on the provision of risk
management tools designed to smooth out the fluctuation in milk prices and feed costs separately or as an
index of income over feed cost. These instruments include a fully functional derivatives market for milk and
dairy products at the US Chicago Mercantile Exchange offering strictly private futures and options contracts
to dairy farmers. In addition to these market-based instruments, the United States Department of Agriculture,
Risk Management Agency offers a private-public, subsidized insurance product designed to limit volatility in
income over feed cost. Lastly, as part of the current United States debate on the safety-net provisions of the
2013 farm bill, an income over feed cost insurance program is being proposed and if made law will become a
centerpiece of federal government support of US dairy farmers for the next five years.
(A)
For more details see blog post at http://marinbozic.info/blog/?p=316
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References
Bozic, M., Newton, J., Thraen, C.S., Gould, B.W. 2012. Mean-reversion in Income Over Feed Cost Margins:
Evidence and Implications for Managing Margin Risk by US Dairy Producers. Journal of Dairy Science.
95:7417-7428.
Newton, J., C.S. Thraen, M. Bozic, M.W. Stephenson, C. Wolfe, and B.W. Gould. 2013. Goodlatte-Scott vs.
the Dairy Security Act: Shared Potential, Shared Concerns and Open Questions. Briefing Paper 13-01,
Midwest Program on Dairy Markets and Policy.
Newton, J., C.S. Thraen, and M. Bozic. 2013a. Actuarially Fair or Foul? Asymmetric Information Problems in
Dairy Margin Insurance. Paper presented at the annual meetings of NCCC-134, Applied Commodity and
Price Analysis, Forecasting, and Market Risk Management, St. Louis, MO.
Newton, J., Thraen, C.S., and M. Bozic. 2013b. Whither Dairy Policy? Evaluating Expected Government
Outlays and Distributional Impacts of Alternative 2013 Farm Bill Dairy Title Proposals. Paper presented at
AAEA Annual Meeting, Washington, D.C., 4-6 August.
Nicholson, C. and Stephenson, M.W. 2011. Market Impacts of the Dairy Security Act of 2011 and the Dairy
Provisions of the Rural Economic Farm and Ranch Sustainability and Hunger Act of 2011. Dairy Markets and
Policy Information Letter Series.
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Annex 1: Country reports

General remarks
The following country reports are based on information sent by IDF National Committees and by
other national organizations.
The IDF National Committees (and other national organizations) are responsible for the text in the
key development sections of the corresponding Country Reports.
Other sources used: CNIEL, Comtrade, European Dairy Association, European Commission,
Eurostat, FAO, FAPRI, PZ, PRB, UN, USDA, AMI, ZMB, IFCN, FED, DNB, National Statistics.
2012 data are preliminary.
The ranking in the list of main processors in the country reports is based on the quantity of milk
processed. If not, it is specified.
Processing and trade/summary table: products may not have the same definition in the production
section and in the trade section, therefore figures should not be compared. For example trade of
liquid milk and cream can include trade in bulk, and trade figures of cheese include processed
cheese.
The '-' sign is used when figures are not available, confidential or senseless (as a numeric result
from calculations).
The value '0' (zero) is used when volume is < 500 tonnes or nil.
Consumption data may not always take into account informal consumption and therefore may differ
from actual dairy product consumption in a country.
The ranking in this annex is based on the quantity of cows milk production per country group (and
then in alphabetical order):
1. Asia;
2. EU 27;
3. North and Central America;
4. South America;
5. Other Europe;
6. Africa;
7. Oceania.
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81
Contents:
Contents:
AsiaAsia Other
Other
Europe
Europe
China
China page
page 83 83 Belarus
Belarus page
page165165
India
India page
page 85 85 Croatia
Croatia page
page167167
IranIran page
page 87 87 Iceland
Iceland page
page169169
Israel
Israel page
page 89 89 Norway
Norway page
page171171
Japan
Japan page
page 91 91 Russia
Russia page
page173173
Kazakhstan
Kazakhstan page
page 93 93 Switzerland
Switzerland page
page175175
Korea,
Korea,
Republic
Republic
of of page
page 95 95 Ukraine
Ukraine page
page177177
Mongolia
Mongolia page
page 97 97
Pakistan
Pakistan page
page 99 99 Africa
Africa
Turkey
Turkey page
page 101101 Egypt
Egypt page
page179179
South
South
Africa
Africa page
page181181
European
European Union
Union page
page 103103 Zimbabwe
Zimbabwe page
page183183
Austria
Austria page
page 105105
Belgium
Belgium page
page 107107 Oceania
Oceania
Cyprus
Cyprus page
page 109109 Australia
Australia page
page185185
CzechCzechRepublic
Republic page
page 111111 NewNew
Zealand
Zealand page
page187187
Denmark
Denmark page
page 113113
Estonia
Estonia page
page 115115
Finland
Finland page
page 117117
France
France page
page 119119
CONTENTS ANNEX 1
CONTENTS ANNEX 1
Germany
Germany page
page 121121
Hungary
Hungary page
page 123123
Ireland
Ireland page
page 125125
ItalyItaly page
page 127127
Latvia
Latvia page
page 129129
Lithuania
Lithuania page
page 131131
Luxembourg
Luxembourg page
page 133133
Netherlands
Netherlands page
page 135135
Poland
Poland page
page 137137
Portugal
Portugal page
page 139139
Slovakia
Slovakia page
page 141141
SpainSpain page
page 143143
Sweden
Sweden page
page 145145
United
United
Kingdom
Kingdom page
page 147147
North
North
andand
Central
Central
America
America
Canada
Canada page
page 149149
Mexico
Mexico page
page 151151
United
United
States
States
of America
of America page
page 153153
South
South
America
America
Argentina
Argentina page
page 155155
Brazil
Brazil page
page 157157
Chile
Chile page
page 159159
Colombia
Colombia page
page 161161
Uruguay
Uruguay page
page 163163
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82 82
CHINA
ASIA
DAIRY FARMING
Key figures
Cow milk production (x 1 000 tonnes) 37 440 Number of dairy cows (x 1 000 head) 14 400
% of worldwide milk production 5.9% Number of dairy farms (A) 213 632
% cow milk deliveries 75%
(A) Farms with more than 10 cows in 2010.
Cow milk deliveries Cow milk prices (B)

1 000 tonnes CNY per 100 kg
32 000 400
27 912
29 000 320
26 000 240
23 000 160
20 000 80
17 000 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
(B) Real fat and protein contents.
PROCESSING INDUSTRY
Main processors
Yili Dairy Group www.yili.com
Mengniu Dairy Group www.mengniu.com.cn
Wahaha Group www.wahaha.com.cn
Bright Dairy Group www.brightdairy.com
Vivi Group www.vvgroup.com
Production
1 300 100
1 200 80
1 100 60
1 000 40
900 20
800 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
WMP (C) Butter/-oil Cheese (D) SMP
(C) Including infant formula. (D) Including processed cheese, made from imported natural cheese.
TRADE
Export Import
20 500
16 400
12 300
8 200
4 100
0 0
Cheese Butter/-oil WMP SMP Cheese Butter/-oil WMP SMP
2005 2011 2012 2005 2011 2012
83 83
PROCESSING AND TRADE

Summary (see general remarks)
Production Import Export
Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 21 466 129 80 268 27 111
Fermented products 4 076 104 8 316 1 56
Cream - - 13 128 0 5
Butter and butteroil 55 92 48 135 3 77
Cheese (E) 30 149 39 136 0 133
Whole milk powder (F) 1 099 105 406 127 9 103
Skim milk powder 21 60 168 129 0 150
(E) Including processed cheese, made from imported natural cheese. (F) Production of infant formula included.
CONSUMPTION
Consumption (x 1 000 tonnes) Population
Milk 21 519 mln inhabitants
Butter 101 1 600
Cheese 68
1 500
1 350.4
Consumption (kg per capita) 1 400
Milk 15.9 1 300

Butter 0.1 1 200
Cheese 0.1
1 100
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
Slow growth of dairy production demonstrated that Chinese consumer confidence was gradually recovering in
2012.
The volume of dairy imports continued to grow significantly, especially bulk milk powder, which had a huge
impact on the domestic milk powder industry at the beginning of 2012, and caused a reduction in milk powder
production for some companies. The production of milk powder recovered during the last half-year with the
rise of international bulk milk powder prices.
The construction of self-owned raw milk farms by key companies greatly increased and the proportion of this
milk went up sharply. Most enterprises reached over 40% of their own milk, some bigger enterprises reached
60% and even 100%.
The Chinese government has continued its strict supervision of dairy products, and the quality inspection
authorities tested 128 240 samples in 2011 and 2012. The pass rate percentage was 99.74%, 12 082 of which
were formula powder samples and whose pass percentage was 99.23%. The results of the inspection showed
that domestic dairy products were of high quality and safe.
Source: National Committee of the IDF, China Dairy Industry Association (www.cdia.org.cn), Comtrade,
national statistics, FAO, USDA, FAPRI, PRB.
84 84
INDIA (A)
ASIA
(A) Dairy years: April to March DAIRY FARMING

Key figures (B)
% of worldwide milk production 9.2% Number of buffaloes (x 1 000 head) 38 061
Buffalo milk production (x 1 000 tonnes) 65 696
% of worldwide milk production 67.5%
(B) Year 2011/12.
Milk production Milk prices (F = fat%, SNF = Solid Non Fat %) (C)
1 000 tonnes INR per 100 kg
80 000 2 500
65 696
70 000 2 000
F 4.5% F 4.5%
60 000 1 500 SNF 3.5% SNF 3.5%
F 4.5%
57 387 SNF 3.5%
50 000 1 000
40 000 500
Cow milk Buffalo milk
30 000 0
2005/06 2007/08 2009/10 2011/12 2010/11 2011/12 2012/13
(C) Mixed (cow and buffalo) milk; refers to cooperative dairies only.
PROCESSING INDUSTRY
Main processors
Mother Dairy www.motherdairy.com
Banaskantha District Cooperative www.banasdairy.coop
Mehsana District Cooperative www.dudhsagardairy.co.in
Hatsun Agro Product www.hatsun.com
Gujarat Cooperative Milk Marketing Federation www.amul.com
Production (D)
250 15
200 12
150 9
100 6
50 3
0 0
2007/08 2009/10 2011/12 2007/08 2009/10 2011/12
Butter/-oil WMP SMP Cheese (E)
(D) Refers to cooperative dairies only. This may not reflect the development for the total Indian dairy industry. (E) Incl. processed cheese.
TRADE
Export Import
75 75
60 60
45 45
30 30
15 15
0 0
2005/06 2010/11 2011/12 2005/06 2010/11 2011/12
85 85

Production (F) Import Export
Volume (x 1 000 tonnes) 2011/12 (10/11=100) 2011/12 (10/11=100) 2011/12 (10/11=100)
Liquid milk 8 632 104 0 222 15 533
Butter/-oil (ghee) 228 121 7 42 8 64
Cheese (G) 10 113 1 71 2 96
Whole milk powder 99 101 6 52 0 5
Skim milk powder 96 211 45 221 0 2
(F) Refers to cooperative dairies only. This may not reflect the development for the total Indian dairy industry. (G) Incl. processed cheese.
CONSUMPTION
Milk - mln inhabitants
Butter - 1 500
Cheese -
1 400
1 259.7
Consumption (kg per capita) 1 300
Milk - 1 200
Butter - 1 100
Cheese -
1 000
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
GDP at constant prices (base year 2004/05) for 2012/13 is estimated at 55 054 billion INR (approximately
1 012 billion USD), against 52 436 billion (approximately 1 094 billion USD) during the previous year, showing
an annual growth rate of 5%.
India produced about 134 million tonnes of milk in 2012/13, registering an increase of 4.7% over the previous
years milk production. In terms of output value, milk continues to be the single largest agricultural commodity
in India.
Dairying continues to be an important secondary source of income for millions of rural families and plays an
important role in providing employment and income-generating opportunities.
The yearly average increase in farm level milk prices (paid by dairy cooperatives to farmers) was around
4.65% in 2012/13 over 2011/12. Yearly increase in Wholesale Price Index (WPI) of milk was around 7.23 % in
2012/13 over 2011/12.
The estimated per capita apparent consumption availability of milk increased to around 296 grams per day
(around 108 kg per annum) in 2012/13 from 290 grams per day (around 106 kg per annum) in 2011/12.
The National Dairy Plan Phase I was launched by the Government of India in April 2012 to meet the rapidly
growing demand for milk in the country through a scientifically planned multi-state initiative. About 80 sub-
project proposals in 12 states have been approved to date.
The National Livestock Mission (NLM) is being launched in 2013/14 to attract investment and to enhance
productivity of livestock, taking into account local agro-climatic conditions. There will be a sub-mission in NLM
to increase the availability of feed and fodder.
Source: National Committee of the IDF, PRB.
86 86
IRAN
ASIA
DAIRY FARMING
Key figures
% of worldwide milk production 1.1% Number of dairy farms 13 045
Cow milk deliveries Cow milk prices (F = fat%, P = protein%)

1 000 tonnes 1 000 IRR per 100 kg
7 500 1 000
5 700 F 3.2%
6 000 800 P 3.0%
F 3.2%
4 500 600 P 3.0%
3 000 400
F 3.2%
1 500 200 P 3.0%
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
IDIC www.irandairy.ir
Sahar Dairy www.sahardairy.com
Kalleh www.kalleh.com
Mihan www.mihan-dairy.com
Pak Dairy www.pakdairy.com
Production
300 100
280 80
260 60
240 40
220 20
200 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese Butter SMP
TRADE
Export Import
50 75
40 60
30 45
20 30
10 15
0 0
2005 2011 2012 2005 2011 2012
87 87

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 1 100 92 0 >1 000 0 -
Fermented products 2 250 113 0 7 0 -
Cream 110 100 - - 0 -
Butter and butteroil (A) 41 91 45 82 0 3
Cheese 268 103 0 62 0 0
Whole milk powder - - 1 45 1 134
(A) Production of butter only.
CONSUMPTION
Butter 21 100
Cheese 372
90
78.9
Consumption (kg per capita) 80
Milk 19.0 70
Butter 0.3 60
Cheese 4.7
50
2005 2006 2007 2008 2009 2010 2011 2012
Source: National Committee of the IDF, Iran Dairy Industries Co. (www.irandairy.ir), Comtrade, PRB.
88 88
ISRAEL
ASIA
DAIRY FARMING
Key figures
Cow milk production (x 1 000 tonnes) 1 385 Number of dairy cows (x 1 000 head) 126
% of worldwide milk production 0.2% Number of dairy farms 940

1 000 tonnes ILS per 100 kg
1 500 250
1 385
1 400 200
F 3.6% F 3.6%
1 300 150 F 3.6% P 3.2% P 3.2%
P 3.2%
1 200 100
1 100 50
1 000 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Tnuva www.tnuva.co.il
Milko-tara www.tara.co.il
Strauss group www.strauss-group.com
Gad www.gad-dairy.co.il
Golan Dairy -
Production
180 15
150 12
120 9
90 6
60 3
30 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese Butter/-oil SMP
TRADE
Export Import
10 10
8 8
6 6
4 4
2 2
0 0
2005 2011 2012 2005 2011 2012
89 89

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 438 103 - - 0 100
Fermented products 149 103 - - 0 50
Cream 38 106 - - - -
Cheese 128 102 3 130 1 94
Whole milk powder 0 - 4 115 0 -
Skim milk powder 9 93 3 56 0 -
CONSUMPTION
Milk 438 mln inhabitants
Butter 7 10
Cheese 135
9
7.9
Milk 55.4 7
Butter 0.9 6
Cheese 17.1
5
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
Cows' milk production in 2012 was 1 344 mln litres, 6 mln litres (0.4%) more than in 2011 (goat and sheep:
about 25 mln litres per year). 99% is marketed through dairies (the rest is used for domestic consumption and
calves). Milk is produced on 940 farms: 58% on 163 cooperative farms (average production 4 725 000 litres,
yield 12 021kg/cow/year), 41% on 762 family farms (average production 732 000 litres, yield 11 155
kg/cow/year) and 1% on 15 agricultural schools.
The number of farms decreased from 1 133 in 2003 to 940 in 2012, while the average yield/cow increased
from 10 426 to 11 706 kg in 2012, like the average farm size: from 991 000 to 1 406 000 litres/farm. There is a
continuous improvement in milk quality and solids contents (fat and protein).
In Israel, three major dairies cover 90% of the dairy market; more than 80 small dairies cover the rest. The
biggest dairy became privately owned in 2008.
The basic milk price is determined by the government, on the basis of production costs. It rose from 2.11 ILS
in 2011 to 2.15 ILS in 2012, due to the increase in feed prices.
In 2012, dairy sales increased by 2.4%. Population increased by 1.8% and per capita consumption by 0.6%.
Milk in Israel is produced under a quota system. Milk, like other agricultural products, enjoys high custom
protection. However, due to trade treaties, the custom rate is in decline. The 2011 Dairy Law regulates the
dairy industry, states the principles of the quota regime, establishes the target milk price and defines the
objectives of the Israel Dairy Board.
Following a public protest against the increase in food and housing prices in 2011, three government
committees were formed to decide how to reduce taxes on dairy products, deregulate the dairy market,
improve centralization in the food chain, etc. A compromise was finally reached, and the draft will be
implemented during 2013-2016. As a result, farm restructuring is expected (closing of nearly 100 family-
owned farms, increase of average quota, milk production efficiency gain by over 2% per year), as well as
drops in retail prices, through target price reduction, import increase and national competition improvement.
Source: National Committee of the IDF, Israel Dairy Board (www.israeldairy.com), Comtrade, PRB.
90 90
JAPAN
ASIA
DAIRY FARMING
Key figures
Cow milk deliveries Cow milk prices (A)

1 000 tonnes JPY per 100 kg
8 500 10 000
8 200 8 000
7 900 6 000
7 572
7 600 4 000
7 300 2 000
7 000 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
(A) Real fat and protein contents.
PROCESSING INDUSTRY
Main processors
Meiji www.meiji.co.jp
Megmilk Snow Brand www.meg-snow.com
Morinaga Milk Industry www.morinagamilk.co.jp
Yotsuba Milk Products www.yotsuba.co.jp
Takanashi Milk Products www.takanashi-milk.co.jp
Production
200 100
180 80
160 60
140 40
120 20
100 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
SMP Cheese Butter WMP
TRADE
Export Import
5 250
4 200
3 150
2 100
1 50
0 0
2005 2011 2012 2005 2011 2012
91 91

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 3 694 98 0 40 2 121
Fermented products - - 0 106 0 106
Cream 113 101 0 0 0 0
Butter and butteroil (B) 69 110 11 63 0 128
Cheese (C) 47 102 235 109 0 100
(B) Production of butter only. (C) Production of natural cheese in the fiscal year 2012 (period April 2012-March 2013).
CONSUMPTION
Butter 79 130
Cheese 267
129
127.5
Milk 31.6 127

Butter 0.6 126
Cheese 2.1
125
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
In the fiscal year (FY) 2012 raw milk production increased over the previous year. Production increased in
both Hokkaido, the main milk producing district in Japan, and in other regions primarily due to the recovery
from the influence of the earthquake disaster.
Raw milk production in Hokkaido accounted for about 40% of Japans total production 15 years ago. Since
then, Hokkaido has increased its share, its production amount in the FY2012 being at around 52% of the total
amount produced in the country.
Liquid milk production decreased by 3.1% in the FY2012 over the previous year due to the continued decline
of consumption. While the production of milk decreased by 1.2%, the production of reconstituted and reduced
fat milk (produced from whole milk) decreased by 12.9%.
Due to the increased use of raw milk for dairy products, the production of skim milk powder (SMP) and butter
increased by 4.8% and 11.2% respectively in the FY2012. On the other hand, cheese production decreased
by 1.5 %, and so did cream production by 1.2% over the previous year.
The wholesale price of SMP and butter went upward in the FY2012; the prices of SMP and butter in
December 2012 were 3.5% and 7.1% higher respectively than in the same month of the previous year.
Japan has been steadily fulfilling its commitments made in the 1995 GATT Uruguay Round Agreement. The
commitment of the current access import opportunities of dairy products is implemented under the state
trading scheme by Agriculture & Livestock Industries Corporation (ALIC). In the FY2012, ALIC has fulfilled its
commitment by importing butter, butter oil, dairy spreads and whey.
ALIC held an additional import tender of 2 000 tonnes of butter in August 2012 to meet the increased demand
toward the end of the year.
Source: National Committee of the IDF, national statistics.
92 92
KAZAKHSTAN
ASIA
DAIRY FARMING
Key figures
Cow milk production

1 000 tonnes
6 000
5 400
4 800
4 816
4 200
3 600
3 000
2005 2006 2007 2008 2009 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Raimbek Agro www.raimbekagro.com
Ajs kompani -
FoodMaster www.foodmaster.kz
Sut -
Karaganda dairy combinyt -
Production
25 25
22 22
19 19
16 16
13 13
10 10
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese Butter
TRADE
Export Import
10 25
8 20
6 15
4 10
2 5
0 0
2005 2011 2012 2005 2011 2012
93 93

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk and cream 376 112 55 122 2 333
Cheese 19 114 22 98 1 87
CONSUMPTION
Butter - 19
Cheese -
18

16.3
Milk - 16
Butter - 15
Cheese -
14
2005 2006 2007 2008 2009 2010 2011 2012
Source: FAO, Comtrade, IFCN, national statistics, UN.
94 94
KOREA, REPUBLIC OF
ASIA
DAIRY FARMING
Key figures

1 000 tonnes 1 000 KRW per 100 kg
3 000 100
2 700 F 4.0%
80 F 4.0% P 3.2%
F 4.0% P 3.2%
2 400 60 P 3.2%
2 111
2 100 40
1 800 20
1 500 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Seoul Dairy Cooperative www.seoulmilk.co.kr
Namyang Dairy Products company.namyangi.com
Maeil Dairies www.maeil.com
Binggrae www.bing.co.kr
Busan Milk Corporation www.busanmilk.com
Production
30 10
24 8
18 6
12 4
6 2
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
SMP Cheese Butter/-oil WMP
TRADE
Export Import
1.0 100
0.8 80
0.6 60
0.4 40
0.2 20
0.0 0
2005 2011 2012 2005 2011 2012
95 95

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 1 685 104 1 450 1 646
Fermented products 558 107 0 74 6 114
Cream 31 160 13 66 1 805
Cheese 4 122 78 102 0 129
CONSUMPTION
Butter 10 51
Cheese 99
50
48.9
Milk 34.5 48
Butter 0.2 47
Cheese 2.0
46
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
Milk production in 2012 recovered to the level it was before the foot-and-mouth disease outbreak, that is, it
increased to 2 111 thousand tonnes which is 11.7% higher compared to 2011 and 1.8% more than 2010.
Factors such as promotion of a policy to increase raw milk production and delay of slaughtering cull cows
were the major reasons for the increased production.
However, the amount of milk production in 2013 is estimated to decrease due to increased numbers of culling
cows, extremely hot weather in the summer, as well as higher feed costs.
Consumption in 2012 was 3 452 thousand tonnes, a decrease of 4% compared to 2011. Increased price of
dairy products, weak demand due to the stagnant economy and a decrease in imports caused this drop in
consumption. Factors such as a slowdown in the economy, a low birthrate and an increase in alternative
drinks, will lead to a decrease in consumption but consumption of exclusive dairy products such as cheese
and fermented milk is expected to steadily increase.
Source: National Committee of the IDF, Korea Dairy Committee (www.dairy.or.kr), Comtrade, PRB.
96 96
MONGOLIA
ASIA
DAIRY FARMING
Key figures
Cow milk production (x 1 000 tonnes) 339 Number of dairy cows (x 1 000 head) 706
% of worldwide milk production 0.1% Number of dairy farms (A) 977
(A) Dairy farms established in centrally located areas and areas close to big cities and provincial centres.

1 000 tonnes 1 000 MNT per 100 kg
100 100
80 80
53
60 60
40 40
20 20
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Suu www.mongolmilk.mn
APU www.apu.mn
Teso www.teso.mn
GUM -
Orgil Huns -
Production
1 000 tonnes
5
0
2005 2006 2007 2008 2009 2010 2011 2012
Cheese Butter/-oil
TRADE
Import
1 000 tonnes
5
0
Cheese Butter/-oil WMP SMP
2005 2011 2012
97 97

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 25 121 1 608 0 -
Fermented products 8 98 1 103 0 -
Butter and butteroil 2 148 0 108 0 -
Cheese 0 429 0 149 0 -
Skim milk powder 0 - 0 15 0 -
CONSUMPTION
Butter 2 5
Cheese 1
4
2.8
Milk 9.2 2
Butter 0.6 1
Cheese 0.3
0
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
The action plan of the Mongolian Government for 2012-2016 includes activities aimed to develop the domestic
dairy sector. Milk is determined as a strategic food item. For the first time in 20 years, the issue of giving
subsidies to farmers, who produce quality milk and deliver to processing plants, has been raised and worked
on by the government. The government allocated 30% of required funds of 110.3 bln MNT (1 USD=1 345
MNT) to short term development in the dairy sector. These funds will be used for steady supply and
production of fresh milk to urban areas, improve seasonality of production, to import decrease, to create
fodder farms and for the establishment of proper milk procurement logistics. Under this programme, 15 dairy
farms with 300 cows each, 3 dairy processing plants with a 20 tonnes daily capacity, one milk powder plant
with a processing capacity of 60 tonnes of milk daily will be established near the big three cities Ulaanbaatar,
Darkhan and Erdenet in 2013-2016. At the same time, 86 small-scale milk processing units will be established
in remote rural areas, where the pastural husbandry system prevails.
Current operators, such as APU LLC, Suu SHC, Vitafit Invest LLC, Teso LLC have made investments worth
40 bln MNT in technical renovations in drinking milk and fermented beverages production and still continue to
be main players and competitors in the sector.
For food security reasons and coordination of milk imports, as a strategic food item, the idea of introducing a
milk quota has been worked on by the government. The United Farmers Association has negotiated with the
government on limitations of milk powder imports, establishing a base farm gate price for a litre of milk of no
less than 650 MNT in summer and 1 050 MNT in winter; there is a tendency for a price increase of raw milk,
as well as for finished dairy products.
Due to government support and interventions, as well as an increase in private investments, the industrial
utilization of milk will be increased by almost double, also allowing a two-fold increase in consumption of
domestic dairy products. Urban consumers will be satisfied with the improved appearance of dairy products on
the market in terms of packaging, quality and taste. Consumers have become aware of the differences
between recombined and fresh dairy products and are looking for more fresh products made from raw milk on
the market.
Source: National Committee of the IDF, Ministry of Food, Agriculture and Light Industry (www.mofa.gov.mn),
FAO, Comtrade, UN.
98 98
PAKISTAN (A)
ASIA
(A) Dairy years: July to June. DAIRY FARMING

Key figures (B)
Cow milk production (x 1 000 tonnes) 13 897 Number of dairy cows (x 1 000 head) (C) 10 550
% of worldwide milk production 2.2% Number of buffaloes (x 1 000 head) (C) 12 000
Buffalo milk production (x 1 000 tonnes) 24 370 Number of dairy farms (D) 7 399 000
% of worldwide milk production 24.2%
(B) Year: 2012/13. (C) Year: 2011/12. (D) Year: 2010.
Milk production (E)
1 000 tonnes
30 000
Cow milk Buffalo milk 24 370
26 000
22 000
18 000
13 897
14 000
10 000
2006/07 2008/09 2010/11 2012/13
(E) Milk production for human consumption.
PROCESSING INDUSTRY
Main processors
Nestl www.nestle.pk
Haleeb www.haleebfoods.com
Engro www.engro.com
Shakarganj www.shakarganj.com.pk
Idara-e-Kissan -
Production
750 5
700 4
650 3
600 2
550 1
500 0
2005/06 2007/08 2009/10 2011/12 2005/06 2007/08 2009/10 2011/12
Butter/-oil SMP
TRADE
Export Import
5 50
4 40
3 30
2 20
1 10
0 0
2005/06 2010/11 2011/12 2005/06 2010/11 2011/12
99 99

Production (F) Import Export
Volume (x 1 000 tonnes) 2011/12 (10/11=100) 2011/12 (10/11=100) 2011/12 (10/11=100)
Liquid milk - - 0 40 40 99
Cream 2 100 0 0 0 0
Butter/-oil (ghee) 669 100 0 377 0 34
Cheese - - 1 116 0 439
(F) Production: year 2010/11.
CONSUMPTION
Butter 669 200
Cheese -
190
179.2
Milk - 170
Butter 3.7 160
Cheese -
150
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
Cow, buffalo, goat and camel milk production all increased during 2012-13 compared to the year 2011-12.
Despite the increase in production, the wholesale and retail prices of dairy products increased throughout the
whole country in 2012-13 over 2011-12.
Source: Agricultural Census Organization (www.statpak.gov.pk), national statistics, Comtrade, FAO, IFCN,
UN.
100 100
TURKEY
ASIA
DAIRY FARMING
Key figures
% of worldwide milk production 2.5% Number of dairy farms 1 382 281
Cow milk production Cow milk prices (F = fat%, P = protein%)

1 000 tonnes TRY per 100 kg
18 000 100
15 978
16 000 80
F 3.5%
14 000 60 F 3.7% P 2.8%
F 3.5%
P 3.4%
P 2.8%
12 000 40
10 000 20
8 000 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Ak Gida www.ulker.com.tr
Sta www.sutas.com.tr
Yrsan www.yorsan.com.tr
Pinar www.pinar.com.tr
Akova www.akova.com
Production
750 100
600 80
450 60
300 40
150 20
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese Butter/-oil Milk powder
TRADE
Export Import
50 35
40 28
30 21
20 14
10 7
0 0
2005 2011 2012 2005 2011 2012
101 101

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 1 250 107 - - 18 113
Fermented products (A) 1 561 106 0 176 9 83
Cream - - - - 1 59
Cheese 564 109 7 116 35 115
(A) Kefir excluded.
CONSUMPTION
Butter 56 77
Cheese 536 74.9
75
Milk 16.5 71
Butter 0.7 69
Cheese 7.2
67
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
The number of dairy animals in Turkey has been rising for the past 4 years. Total milking animals including
cows, sheep, goats and buffalo amounted to over 20 million heads in 2012 and the total milk production was
17.4 million tonnes. The main point that needs to be emphasized is that while the amount of dairy cows has
risen 23% in the last decade, the total milk production has shown a 107% increase in the same time period.
This growth rate difference comes from subsidies and an increase in farmers awareness, resulting in
improvement in the feeding and maintenance systems.
Another development was seen in dairy product trade figures in 2012. Turkeys total amount of export volume
of dairy products rose by 34.5% in 2011 and this trend also continued in 2012, particularly in whey and cheese
export. In addition, per capita dairy consumption increased in 2012. While per capita liquid milk consumption
was estimated at 26 litres over the last few last years, it increased to 33.2 litres in 2012 thanks to the School
Milk Program which has been running for the last two years. As for raw milk prices, the price is determined for
a particular time period nationally by negotiations between milk producers and processor representatives. The
average milk price for 2012 was 0.825 TRY/litre.
The major problem of Turkeys dairy sector in previous years was farm gate price volatility. In order to prevent
price fluctuation, the Turkish Food, Agriculture and Livestock Ministry put some regulations into practice
including having milk powder produced from surplus milk caused by seasonality, and the School Milk Program
that encompasses the whole country.
Source: National Committee of the IDF, National Dairy Council, national statistics, Comtrade, FAO, UN.
102 102
EUROPEAN UNION
DAIRY FARMING
Key figures
EU 27
(A) Number of delivery quota holders.

1 000 tonnes EUR per 100 kg
142 000 50
140 345
140 000 40
138 000 30
136 000 20
134 000 10
132 000 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
(B) Weighted average, real fat and protein contents.
PROCESSING INDUSTRY
Main processors (C)
Lactalis www.lactalis.fr
Danone www.danone.com
Friesland Campina www.frieslandcampina.com
Arla Foods www.arla.com
DMK www.dmk.de
(C) Ranking based on dairy turnover.
Production
9 000 2 500
8 700 2 000
8 400 1 500
8 100 1 000
7 800 500
7 500 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
1000 150
800 120
600 90
400 60
200 30
0 0
2005 2011 2012 2005 2011 2012
103 103

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 32 875 100 5 66 403 142
Cream 2 544 104 5 99 113 129
Butter and butteroil 2 058 101 44 98 126 101
Cheese 8 785 101 77 103 774 114
Skim milk powder 1 211 100 2 417 523 101
CONSUMPTION
Butter 1 838 508
Cheese 8 649 502.6
504
Milk 64.0 496

Butter 3.7 492
Cheese 17.2
488
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
After two years of ongoing growth of milk deliveries (+7.5 mln tonnes between April 2010 and June 2012),
European production started decreasing in July 2012, under the combined effects of both high input prices
and bad weather. However, for the whole of the year 2012, volumes were significantly higher than in 2011, by
0.8 million tonnes.
Following the trends of dairy product markets, farm gate milk prices reached a low at the start of summer 2012
but then recovered again in most Member States. European output of dairy products did not progress much in
2012 compared with 2011. They remained rather stable for most products, even negative (-2.9% for WMP).
Only cream (+4.3%), butter (1.0%) and cheese (+1.4%) production increased in comparison with the previous
year. Cheese exports towards third countries were particularly dynamic (+13.9%).
In February 2012, the European Commission adopted the so-called Milk Package, a set of rules aiming to
promote contracts between farmers and processors, implementation of interbranch organizations and
producer organizations, and encouraging market transparency within the EU 27. This was in preparation of
the phasing-out of the quota system, as stipulated in the CAP reform, still under discussion over the course of
the year 2012. The new CAP was finally voted in in June 2013 and it contains 4 pillars; greener agriculture,
fairer subsidy distribution, more competitiveness and simpler procedures.
In terms of structural changes at industry level, the following can be cited: French Lactalis acquired a major
share of Sloven Ljubljanske Mlekarne and German group Mller entered the World Top-20 list of dairy groups
by acquiring British Robert Wiseman. The latter, thanks to a partnership with a NZ company called A2Corp,
launched A2 products on the British market, that is containing A2 beta-casein. NZ co-op Fonterra joined
forces with big Dutch trader A-Ware in order to build a cheese and ingredient factory in the Netherlands.
An important merger was that of Arla Foods in Denmark, Milk Link in the UK and MUH in Germany, allowing
the co-op to grow to 12 300 co-operative owners. Massive investments in new dryers have been carried out
over the last few months, notably in dynamic dairy areas like Ireland, Northern Germany, Western France, the
Netherlands or Denmark, all of whom are expecting more milk after 2015.
Source: IDF, European Commission, Eurostat.
104 104
AUSTRIA
DAIRY FARMING
Key figures
EU 27

3 200 50
2 964
3 000 40
2 800 30 F 4.2% F 4.2%
F 4.2% P 3.4% P 3.4%
2 600 20 P 3.4%
2 400 10
2 200 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Berglandmilch www.berglandmilch.at
NM www.noem.at
Gmundner Molkerei www.gmundner-milch.at
Alpenmilch Salzburg www.milch.com
Obersteirische Molkerei www.oml.at
Production
200 10
160 8
120 6
80 4
40 2
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
125 125
100 100
75 75
50 50
25 25
0 0
2005 2011 2012 2005 2011 2012
105 105

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk (A) 769 102 58 98 372 109
Cream 63 99 7 129 6 111
Cheese 165 104 97 109 116 113
(A) Import and export: excluding bulk milk.
CONSUMPTION
Milk (B) 659 mln inhabitants
Butter 42 10
Cheese 164 8.5
9
Milk (B) 77.6 7

Butter 5.0 6
Cheese 19.2
5
2005 2006 2007 2008 2009 2010 2011 2012
(B) Including milk drinks and fermented products.
Source: National Committee of the IDF, Eurostat, PRB.
106 106
BELGIUM
DAIRY FARMING
Key figures
EU 27

3 700 50
3 500 40
3 319
3 300 30 F 4.1%
F 4.1% P 3.4% F 4.1%
3 100 20 P 3.4% P 3.4%
2 900 10
2 700 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors (A)
Danone www.danone.be
Milcobel www.milcobel.be
FrieslandCampina www.frieslandcampina.com
Corman www.corman.be
Laiterie des Ardennes -
(A) Ranking based on turnover.
Production
100 200
80 160
60 120
40 80
20 40
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese WMP Butter/-oil (B) SMP
(B) Including reprocessed butter. Years 2007-2012: calculated.
TRADE
Export Import
200 300
160 240
120 180
80 120
40 60
0 0
2005 2011 2012 2005 2011 2012
107 107

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 679 106 872 116 905 105
Cream 176 110 83 73 101 122
Butter and butteroil (C) 112 92 114 91 116 102
Cheese 76 99 275 105 171 102
Skim milk powder 102 98 100 110 167 103
(C) Production including reprocessed butter (years 2011 and 2012: calculated).
CONSUMPTION
Butter 28 13
Cheese 170
12
11.1
Milk 50.5 10
Butter 2.5 9
Cheese 15.3
8
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
In terms of structural changes in farming and industry, there has been a reorganization of deliveries within the
Belgian subsidiary of Friesland Campina and Danone. Producers are recovering from a period with low
margins because of high feed costs.
Price trend at farm level 2012 versus 2011 was down -12%, and the price trend at retail level January 2013
versus January 2012 was as follows: drinking milk (+0.3%), cheese (+0.1%) and butter (+0.8%).
For consumption, there was a stable market for cheese from October 2011 until September 2012 (average
consumption of 12 kg cheese and 3.4 kg fresh cheese). For liquid milk, the average consumption of liquid milk
is declining (-4%) and for butter there was a growth in consumption of milk products of discount brands.
In terms of policy, one producer organization has been recognized, another one is preparing to send in its
application. CAP discussions and worries about possible new supply management system (Dantin, Frances
proposal).
There are good prospects for economic situation for the coming months.
Source: National Committee of the IDF, Belgische Confederatie van de Zuivelindustrie (www.bcz-cbl.be),
Eurostat, national statistics, PRB.
108 108
CYPRUS
DAIRY FARMING
Key figures
EU 27

200 75
170 60
140 153 45 F 3.7% F 3.6% F 3.7%
P 3.4% P 3.4% P 3.4%
110 30
80 15
50 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Charalambides Christis www.charalambideschristis.com.cy
Lanitis Bros en.coca-colahellenic.com.cy
Pittas Dairy Industries www.pittas.com
Petrou Bros Dairy Products www.petroubros.com.cy
K.G. Souroullas & Sons -
Production
20 1.0
16 0.8
12 0.6
8 0.4
4 0.2
0 0.0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese (A) Butter/-oil
(A) All kinds of milk.
TRADE
Export Import
15 15
12 12
9 9
6 6
3 3
0 0
2005 2011 2012 2005 2011 2012
109 109

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 83 104 4 152 0 -
Fermented products (B) 9 100 3 108 0 -
Cream (B) 11 100 - - - -
Butter and butteroil (B) 0 100 1 100 0 -
Cheese (B)(C) 14 100 10 100 10 109
Skim milk powder 0 - 1 179 0 >1 000
(B) Production: year 2011. (C) All kinds of milk.
CONSUMPTION
Butter 2 1.0
Cheese 15 0.9
0.8
Consumption (kg per capita) 0.6
Milk 101.0 0.4

Butter 1.9
0.2
Cheese 18.1
0.0
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
The economic crisis has affected the ability of producers to buy animal feed, as they are asked to pay in cash.
Prices of milk and milk products are expected to rise based on the information obtained from dairy producers.
Source: National Committee of the IDF, Cyprus Milk Industry Organization (www.cmio.org.cy), Eurostat.
110 110
CZECH REPUBLIC
DAIRY FARMING
Key figures
EU 27

1 000 tonnes CZK per 100 kg
2 800 1 000
2 694
2 700 800
F 3.9%
2 600 F 3.9% F 3.9%
600 P 3.4%
P 3.4% P 3.4%
2 500 400
2 400 200
2 300 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Madeta www.madeta.cz
Mlkrna Pragolaktos www.alimpex.cz
Mlkrna Hlinsko www.tatramleko.cz
Olma www.olma.cz
Orrero www.orrero.cz
Production
150 75
130 60
110 45
90 30
70 15
50 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese Butter WMP SMP
TRADE
Export Import
50 100
40 80
30 60
20 40
10 20
0 0
2005 2011 2012 2005 2011 2012
111 111

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 601 93 52 91 708 111
Cream 47 99 16 100 15 59
Cheese 111 101 84 104 39 120
Skim milk powder 16 118 2 100 17 118
(B) Production of butter only.
CONSUMPTION
Butter 56 13
Cheese 177
12
10.7
Milk 58.5 10
Butter 5.2 9
Cheese 16.6
8
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
In milk production, the situation in the first half of 2012 was relatively stable: high milk supply and stable milk
prices. In the second half of the year, the situation changed (due to adverse weather conditions and
developments in world demand); there was a decline in the supply of milk for processing, and also a decline in
average prices. The sector witnessed further decline in the number of producers and further concentration of
primary production, while the number of small farmers with milk production intended for direct sale slightly
increased.
Nevertheless, milk deliveries for processing in the industry still underwent a slight increase; however, the
allocated national milk quota was not used fully (-5.8%). A major problem is the continuing movement of raw
milk for processing abroad, especially to Germany, which accounted for 18% of national milk production in
2012. This problem does not indicate only export of raw material, but also subsequent imports of added value
in the form of dairy products manufactured from this milk.
The manufacturing recession continued, which was caused due to the low effective demand, but especially
due to high import of (cheaper) milk products. In 2012 the share of imported products on domestic
consumption was already 41.8% (cheese: 54%), influenced by foreign retail chains.
Higher cheese production (for the first time since 2004) had the effect of increasing both domestic
consumption and export.
There was a further reduction in the number of processing plants. Currently there are 35 dairy companies
processing milk. The top 10 dairies process 66% of Czech milk. The largest dairy companies are still Czech
owned (e.g. Madeta, Olma, Tatra), but foreign companies are also operating on the market (e.g. Lactalis,
Mller, Danone, Bongrain, Bel, Brazzale). Their share in the processing of milk accounts for more than 47%.
Domestic consumption of all dairy products expressed in milk equivalent increased by 2.9%, and reached
234.2 kg per person. It is expected that this trend will continue.
Source: National Committee of the IDF, Czech & Moravian Dairy Association (www.cmsm.cz), UN.
112 112
DENMARK
DAIRY FARMING
Key figures
EU 27

1 000 tonnes DKK per 100 kg
5 200 300
4 929
5 000 240 F 4.2% F 4.2%
F 4.2% P 3.4% P 3.4%
4 800 180 P 3.4%
4 600 120
4 400 60
4 200 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Arla Foods www.arlafoods.dk
Mammen Mejeri www.mammenost.dk
Thise Mejeri www.thise.dk
Them Andelsmejeri www.them-andelsmejeri.dk
Bornholm Andelsmejeri www.st-clemens.dk
Production
400 125
360 100
320 75
280 50
240 25
200 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
300 100
240 80
180 60
120 40
60 20
0 0
2005 2011 2012 2005 2011 2012
113 113

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 495 105 34 71 25 104
Cream 54 95 5 196 10 86
Cheese 300 109 81 106 272 98
CONSUMPTION
Butter 10 7
Cheese - 5.6
6
Milk 90.0 4
Butter 1.8 3
Cheese -
2
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
The number of dairy farms have decreased from 4 138 to 3 887 over the 2010 2012 period. Milk production
increased from 4 965 to 5 064 (thousand tonnes) and milk deliveries from 4 830 to 4 929 (thousand tonnes)
over the same period.
The number of dairy cows increased slightly from 573 to 579 (thousand head) between 2010 and 2012.
Ex-farm milk price for milk with 4.20% fat and 3.40% protein was 263 DKK/100 kg whole milk in 2012.
st
The tax on saturated fat was abolished on 1 January 2013 and a new tax on added sugar in foods for
example, yoghurts was cancelled. Furthermore, a number of taxes have been reduced or abolished in order
to improve the business climate in Denmark as part of the current governments reform agenda.
The cattle sector, dairy industry, experts and so on, have been involved in a task force whose aim is to make
a list of recommendations to improve the financial situation in the cattle sector.
Source: National Committee of the IDF, Danish Agriculture & Food Council (www.lf.dk), Eurostat, PRB.
114 114
ESTONIA
DAIRY FARMING
Key figures
EU 27

1 000 50
665
800 40
600 30
F 4.0%
F 4.0%
F 4.1% P 3.4%
400 20 P 3.4%
P 3.3%
200 10
0 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Valio Eesti www.valio.ee
Tere www.tere.eu
Coop E-Piim www.epiim.ee
Maag Piimatstus www.maag.ee
Saaremaa Piimatstus www.saarejuust.ee
Production
50 15
40 12
30 9
20 6
10 3
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
20 20
16 16
12 12
8 8
4 4
0 0
2005 2011 2012 2005 2011 2012
115 115

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 87 97 5 26 157 144
Cream 27 98 3 99 4 110
Cheese 41 102 4 106 19 112
Skim milk powder - - 2 362 2 27
CONSUMPTION
Milk (A) 162 mln inhabitants
Butter 5 5
Cheese 27
4

1.3
Milk (A) 124.8 2
Butter 4.1 1
Cheese 20.8
0
2005 2006 2007 2008 2009 2010 2011 2012
(A) Including milk drinks and fermented products.
KEY DEVELOPMENTS
In the last three years, the Estonian economy has adjusted to the post-crisis situation. During its recovery from
the recession, the economy has become more balanced and less vulnerable. The main risk to the Estonian
economy is the fragile growth in demand for exports. As the external environment worsened, Estonian
economic growth slowed in 2012 to 2.9%. Inflation in 2012 was 4.3%.
Over the last five years the number of milk producers has decreased by half. This has happened mainly in a
herd size group of 1 to 10 cows. At the same time, the number of producers with more than 300 cows in a
herd has increased. In Estonia 80% of cows are kept in herds of more than 100 cows. The share of herds of
more than 300 cows accounted for approximately 58%.
The share of food processing in the GDP was 1.6%, which has decreased by 0.1%. The share of milk
processing in total food industry output was 30% (compared to 33% in 2011). The share of exports of dairy
products in total food exports was 25%. In 2012 the raw milk price was 300.44 EUR/per tonne, which is 6.9%
less compared to the previous year. Generally, production amounts of dairy products have decreased with the
exception of cheese which has grown by 5.4%. Export of dairy products has decreased by 2%. The share of
the Russian market was 21%.
In April 2012, the Estonian Dairy Sector Strategy was adopted. The objective of Estonian dairy strategy is to
increase the volume of milk production and processing, and to ensure sustainability by the year 2020. To this
end, the present economic status of Estonian undertakings operating in the field of milk production and
processing will be mapped out, and findings will be made about any the further possible development trends
of the dairy sector. The vision for the year 2020 will be defined along with a description of the measures
necessary to achieve the strategic objectives.
Source: Estonian Dairy Association, national statistics, Comtrade, Bank of Estonia, PRB.
116 116
FINLAND
DAIRY FARMING
Key figures
EU 27

2 500 50
2 400 40
F 4.3%
F 4.3% P 3.3%
2 300 30 F 4.3% P 3.3%
P 3.3%
2 200 20
2 254
2 100 10
2 000 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Valio www.valio.fi
Arla Ingman www.arlaingman.fi
Cooperative Maitomaa www.maitomaa.fi
Cooperative Satamaito www.satamaito.fi
Cooperative Maitokolmio www.maitokolmio.fi
Production
120 25
100 20
80 15
60 10
40 5
20 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
100 100
80 80
60 60
40 40
20 20
0 0
2005 2011 2012 2005 2011 2012
117 117

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 735 101 60 104 13 123
Cream 43 113 1 100 7 125
Cheese 92 92 61 115 45 92
Skim milk powder 20 131 0 100 17 128
CONSUMPTION
Butter 24 7
Cheese 128
6
5.4
Milk 132.4 4
Butter 4.5 3
Cheese 23.7
2
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
Similarly to other EU countries, Finland struggled with economic recession in 2012. The industrial production
decreased, and there was a contraction in imports and exports. GDP declined by -0.2%. However, the
economic outlook for Finland for the second half of 2013 already looks brighter and GDP will slowly start
growing again.
Milk production was practically at the same level as the previous year. The production of organic milk grew by
20% and accounts for 1.7% of total milk production. The number of dairy farms continued to decrease and
650 dairy farms closed their businesses in 2012. By the end of the year there were 9 315 dairy farms in
Finland. The total count of dairy cows was equal to that of 2011, but farm size grew to nearly 30 cows per
farm. Thus, dairy farms in Finland became fewer, but bigger. 87% of the milk quota was used up.
In 2012 the milk price paid to the farmer was on average 2.1 cents higher per litre (2.4 incl. adjustment
payment) compared to the year before. Average fat and protein content were slightly above last years.
Consumption of dairy products went up 3% and production also grew in all categories except cheese. Almost
half of the cheese consumed in Finland is imported and imports grew by 15% in 2012. Regarding exports, half
of the butter production and 72% of the powder production was exported.
Consumer prices for dairy products rose by 4.5% during the year, a period when food prices in general
became 5.4% higher.
Source: National Committee of the IDF, national statistics, Valio Ltd, Eurostat, PRB.
118 118
FRANCE
DAIRY FARMING
Key figures
EU 27

26 000 50
25 000 40
24 000 30
24 226 F 3.7% F 3.7%
F 3.7%
23 000 20 P 3.1% P 3.1%
P 3.1%
22 000 10
21 000 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors (A)
Lactalis www.lactalis.fr
Danone www.danone.com
Sodiaal www.sodiaal.fr
Bongrain www.bongrain.com
Fromageries Bel www.groupe-bel.com
(A) Ranking based on dairy turnover.
Production
1 900 500
1 800 400
1 700 300
1 600 200
1 500 100
1 400 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese (B) Butter/-oil WMP SMP
(B) Cows milk cheese.
TRADE
Export Import
750 300
600 240
450 180
300 120
150 60
0 0
2005 2011 2012 2005 2011 2012
119 119

Summary
Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 3 579 100 407 99 928 93
Cream 380 105 148 91 313 88
Cheese (C) 1 764 100 280 103 675 101
Skim milk powder 353 98 38 105 221 108
(C) Production: not including goats milk cheese (102 700 tonnes) and sheeps milk cheese (58 800 tonnes).
CONSUMPTION
Butter 469 65
Cheese 1 665 63.6
64
Milk 54.3 62
Butter 7.4 61
Cheese 26.2
60
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
After a period of increase between 2009 and 2011, deliveries in 2012 were set back by 1.8 %. With a total
delivery of 24.2 million tonnes, the national quota was not fulfilled and the underuse for the 2012-2013 quota
year was estimated at 5.7%.
Within a context of decreasing milk production, output of consumer-ready products progressed in comparison
with that of ingredients like butter or milk powder. This was particularly the case for UHT fluid milk. In terms of
milk prices, the average price paid to farmers dropped from 31.71 EUR/100kg in 2011 to 30.56 EUR/100kg in
2012. At the same time, costs of production continued growing, reaching a new record plateau by the end of
2012 and making milk production particularly expensive this year, as in many parts of the world.
On average in 2012, retail sales were on a positive trend in total value. The growth was driven by retail prices
more than by volumes. Consumer price indexes have shown stability throughout 2012 at a higher level than in
previous years. However, even after rebounding mid-year, national quotations for bulk butter and milk
powders were on average lower than in 2011: respectively -20% for butter and -12% for SMP.
In order to prepare for the end of the quota system and the future of the dairy sector in general, the European
Commissions Milk Package was adopted in February 2012. The Package aims at strengthening the
bargaining power of dairy farmers by encouraging contracts between farmers and processors, interbranch
organizations, producer organizations, and market transparency, within the European Union. In France,
written contracts were presented to farmers by processors for negotiation throughout the whole year. The
French law on the Economic Organization of the Dairy Sector of April 2012 allows Producer Organizations
(POs) of at least 200 producers, or 60 million litres in total. Numerous POs were recognized by French
authorities in 2012.
Source: National Committee of the IDF, CNIEL (www.cniel.com), Eurostat, PRB.
120 120
GERMANY
DAIRY FARMING
Key figures
EU 27

31 000 50
30 000 29 712
40
29 000 30 F 4.0%
F 3.7% P 3.4% F 4.0%
28 000 P 3.4% P 3.4%
20
27 000 10
26 000 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
DMK www.dmk.de
Hochwald www.hochwald.de
Arla www.arlafoods.de
Mller Gruppe www.muellermilch.de
Molkerei Ammerland www.molkerei-ammerland.de
Production
2 500 500
2 300 400
2 100 300
1 900 200
1 700 100
1 500 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
1 250 1 250
1 000 1 000
750 750
500 500
250 250
0 0
2005 2011 2012 2005 2011 2012
121 121

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk (A) 5 254 100 1 669 94 2 267 92
Fermented products (B) 2 915 96 233 94 804 86
Cream 542 99 8 69 101 107
Cheese 2 240 102 680 103 1 122 107
Skim milk powder 314 104 54 88 282 96
(A) Production of containers <2 litres only. (B) Including dairy desserts and mixed drinks.
CONSUMPTION
Butter 498 84
Cheese 1 952
83

80.5
Milk 55.0 81
Butter 6.2 80
Cheese 24.3
79
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
Germany was in good economic shape in 2012 despite a slowdown of GDP growth to 0.7%. The German
population increased slightly to 80.5 million due to more immigration. The unemployment rate decreased to
6.6%. The inflation-rate lowered to 2.0%, after 2.3% in 2011. The increase in real wages was 0.5%.
Milk deliveries in Germany reached a new record in 2012. German farmers delivered 29.7 mln tonnes of milk
to dairies, an increase of 10% in one decade. The year was separated into two halves. In the first semester,
milk production was very expansive and milk prices fell. In the second semester, milk volumes contracted and
milk prices recovered again. The average producer price in 2012 was 31.99 EUR/kg of milk with 4.0% of fat
and 8% lower than in 2011.
Structural change in dairy farming has been underway. While cow numbers remained stable, the number of
holdings decreased by 4.9% to 82 865. For the first time, the average cow number per holding reached more
than 50 cows.
The quota year 2012/13 ended with an overshoot of quotas of 0.08%.
Retail prices of dairy products went down in 2012 compared with the previous year. Household consumption
of butter and cheese increased, while the consumption of liquid milk and yoghurt decreased.
Costs of milk production increased in 2012, especially for feed concentrates, fertilizer and energy. Unfavorable
weather conditions in some regions of the country had an undesirable effect on the quality of silage.
Source: National Committee of the IDF, Zentrale Milchmarkt Berichterstattung (www.milk.de), Eurostat.
122 122
HUNGARY
DAIRY FARMING
Key figures
EU 27

1 000 tonnes 1 000 HUF per 100 kg
2 500 10
2 000 8 F 3.7% F 3.7%
1 398 P 3.3% P 3.3%
1 500 6 F 3.7%
P 3.3%
1 000 4
500 2
0 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Alfldi Tej www.alfolditej.hu
Sole-Mizo www.solemizo.hu
Tolnatej www.tolle.hu
Krstej www.korostej.hu
FinoFood www.fino.hu
Production
125 15
100 12
75 9
50 6
25 3
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
25 50
20 40
15 30
10 20
5 10
0 0
2005 2011 2012 2005 2011 2012
123 123

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 402 110 133 69 442 111
Cream 5 100 9 63 1 26
Cheese 68 98 42 97 17 127
Whole milk powder 0 - 1 78 0 364
CONSUMPTION
Butter (B) 10 12
Cheese 114
11
9.9
Milk 50.6 9
Butter (B) 1.0 8
Cheese 11.5
7
2006 2007 2008 2009 2010 2011 2012
(B) Excluding industrial use.
KEY DEVELOPMENTS
After several years of a declining trend, in 2012 there was an increase in milk production (5%), as well as in
processing (7%). The positive changes are attributable to the more favorable world market situation, resulting
in improved milk collection prices which motivated producers to increase cow numbers and milk production.
Due to the world market demand, big European exporters were able to sell their surplus at good prices,
therefore easing the import pressure generated by the EU-suppliers on the Hungarian market. This is reflected
in decreasing import figures in the most important product categories like liquid milk and cheese.
Consequently, Hungarian processors were able to regain some market share, allowing them to collect more
milk from the producers. The additional amount was used to increase their sales, partly to the domestic
market, partly to export.
With higher milk collection prices, wholesale and retail prices of the final products also increased. The retail
sectors margin is still quite high compared to that of the producers. Bargaining power of the numerous,
competing processors against the highly concentrated retail chains is relatively weak.
The major aspiration of the Hungarian dairy sector is to increase the generally low consumption. To that end,
one important goal is to further develop the school milk system, to extend the number of pupils involved, being
about 30% at present.
Source: National Committee of the IDF, Hungarian Dairy Research Institute (www.mtki.hu), Comtrade,
Eurostat, PRB.
124 124
IRELAND
DAIRY FARMING
Key figures
EU 27
(A) Year : 2011.

5 700 50
5 500 40
5 300 30 F 3.9% F 3.9%

5 380 F 3.9% P 3.4% P 3.4%
5 100 20 P 3.4%
4 900 10
4 700 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Glanbia www.glanbia.ie
Dairygold www.dairygold.ie
Kerry www.kerry.ie
Lakeland www.lakeland.ie
Aurivo www.aurivo.ie
Production
200 100
180 80
160 60
140 40
120 20
100 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
200 75
160 60
120 45
80 30
40 15
0 0
2005 2011 2012 2005 2011 2012
125 125

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 502 99 303 99 170 91
Cream 21 101 18 251 3 107
Cheese 185 103 54 88 191 108
CONSUMPTION
Milk (B) 644 mln inhabitants
Butter (C) 11 7
Cheese 31
6
4.7
Milk (B) 139.9 4

Butter (C) 2.4 3
Cheese 6.7
2
2005 2006 2007 2008 2009 2010 2011 2012
(B) Including buttermilk. (C) Excluding industrial use.
KEY DEVELOPMENTS
2012 saw continuing preparations for post-quota milk output expansion, at both farm and processor level. The
dairy herd is expanding with an estimated 7% more cattle on farms now compared to 2011.
A poor summer and lower prices saw milk output in 2012 drop on 2011 levels.
Glanbia commenced construction on a new milk drying facility. The new plant, which is due to be operational
by 2015, will include two 7 000 tonne dryers, and will have the capacity to process 700 mln litres of milk
annually. The investment will cost approximately 150 mln EUR. Dairygold have also advanced plans for two
additional 7 000 tonne dryers as part of their post quota expansion plans. Other significant processors have
spare capacity or plans in place to deal with anticipated milk supply increases to 2020.
Dairy product price trends in Ireland aligned with international movements. A good start to 2012 in terms of
high commodity prices was confined to Q1, after which prices took a significant fall in response to increased
production. As weather and price factors curtailed output in the back half of 2012, prices began to recover.
2012 saw slightly reduced dairy product export volumes out of Ireland, in line with lower milk output through
the year.
A new independant Sustainable Dairy and Quality Assurance Scheme is planned for launch in the second half
of 2013. A proposed ban on television advertising of cheese to children by the Broadcasting Authority of
Ireland (BAI) was rejected in favour of the inclusion of an on-screen message regarding recommended daily
allowances.
The general economic situation in Ireland remains difficult, but stable. Unemployment remains high at 14%,
the economy grew slightly in 2012 over 2011 (GDP +0.9%) and is expected to continue modest growth in
2013.
Source: National Committee of the IDF, Irish Dairy Board (www.idb.ie), national statistics, Eurostat, PRB.
126 126
ITALY
DAIRY FARMING
Key figures
EU 27

12 000 50
11 400 40
10 876 F 3.8%
10 800 30 F 3.8%
F 3.8% P 3.2% P 3.2%
P 3.2%
10 200 20
9 600 10
9 000 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Lactalis/Galbani www.galbani.com
Parmalat (Lactalis) www.parmalat.com
Granarolo www.granarolo.it
Latterie Soresina www.latteriasoresina.it
Zanetti spa www.zanetti-spa.it
Production
1 200 200
1 100 160
1 000 120
900 80
800 40
700 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese (A) Butter/-oil
(A) Cows milk cheese.
TRADE
Export Import
500 500
400 400
300 300
200 200
100 100
0 0
2005 2011 2012 2005 2011 2012
127 127

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk (B) 2 758 98 564 109 16 132
Cream 126 100 83 74 12 140
Cheese 1 095 100 481 99 302 107
Whole milk powder 0 - 10 124 8 >1 000
Skim milk powder 0 - 70 81 5 137
(B) Import and export: exclude bulk milk.
CONSUMPTION
Butter 138 62
Cheese 1 274 60.9
61
Milk 54.4 59
Butter 2.3 58
Cheese 20.9
57
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
During 2012 the production of dairy products declined slightly.
The economic and financial situation has resulted in a decrease of sales in the main retail chains, with the
exception of discount stores and hypermarkets that offer lower prices to the consumer.
In 2012 the positive growth in exports continued, increasing by 7% in volume and 3.5% in value compared to
2011. The main products are the following cheeses: Grana Padano PDO, Parmigiano Reggiano PDO and
Mozzarella, followed by all others cheeses. The main importing countries of Italian cheeses are Germany,
France, United Kingdom and USA.
The trend shows an increase in domestic prices over the past 12 months, with some peaks in butter quotations
of +70%. There is an opposite trend for hard cheeses; in particular the prices of Grana Padano and
Parmigiano-Reggiano cheese showed some significant decrease.
The process of restructuring and merging of companies is still ongoing.
Source: National Committee of the IDF, Assolatte, LatteArborea (www.lattearborea.com), CLAL, PRB.
128 128
LATVIA
DAIRY FARMING
Key figures
EU 27

1 000 tonnes LVL per 100 kg
800 25
718
700 20
F 4.2%
P 3.3% F 4.2%
600 15 F 4.3%
P 3.3%
P 3.3%
500 10
400 5
300 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Valmieras piens www.valmieraspiens.lv
Rigas piena kombinats www.rpk.lv
Preilu siers www.preilusiers.lv
Tukuma piens www.baltais.lv
Rigas piensaimnieks www.karums.lv
Production
50 10
40 8
30 6
20 4
10 2
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
20 20
16 16
12 12
8 8
4 4
0 0
2005 2011 2012 2005 2011 2012
129 129

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 66 102 64 238 271 126
Cream 36 140 4 97 7 130
Cheese 31 113 17 105 17 114
CONSUMPTION
Butter 6 5
Cheese 33
4

2.1
Milk 94.8 2
Butter 2.8 1
Cheese 16.0
0
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
Dairy farming is one of the basic sectors of agriculture in Latvia. 870 600 tonnes of cows milk was produced
in 2012, which is 3.4% more than in the previous year. Production of goats milk in Latvia is insignificant,
approximately 3 000 tonnes per year.
Structural changes in the sector are ongoing; the number of small farms (1-9 cows) is decreasing and number
of medium and big farms (more than 30 cows) is increasing. The average herd size in Latvia in 2012 was 24
cows (herds under milk recording) which is a 9% improvement compared to 2011. The average milk yield per
cow is constantly increasing and in 2012 it was 6 489 kg per cow (under milk recording) and 5.8% higher than
in 2011.
Average milk price in 2012 was 19.08 LVL/100 kg. The price decreased by 8% compared to 2011.
In milk equivalent, around 40% of dairy sector produce is exported from Latvia (both to EU and to third
countries). In terms of products, the largest increases in exports were for liquid milk (incl. raw milk) and milk
and whey powder, as in 2011.
Main export markets are EU countries - Lithuania, Germany, Estonia, Netherlands and Italy, as well as Russia
and Azerbaijan in terms of third countries. Lithuania is the largest market but the main exported product is raw
milk (approximately 25% of all raw milk deliveries in Latvia).
Dairy product imports only come from the EU, mainly originating from Lithuania, Estonia, Germany and
Poland.
Source: National Committee of the IDF, SIA Piensaimnieku Laboratorija (www.pienslabs.lv),

national statistics, UN.
130 130
LITHUANIA
DAIRY FARMING
Key figures
EU 27

1 000 tonnes LTL per 100 kg
1 700 150
1 500 120
1 360
1 300 90 F 4.1%
F 4.2% P 3.3% F 4.2%
1 100 60 P 3.3% P 3.3%
900 30
700 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Pieno vaigds www.pienozvaigzdes.lt
Rokikio sris www.rokiskio.com
emaitijos pienas www.zpienas.lt
Vilkyki pienin www.suriai.lt
Marijampols pieno konservai www.milk.lt
Production
150 25
130 20
110 15
90 10
70 5
50 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
100 15
80 12
60 9
40 6
20 3
0 0
2005 2011 2012 2005 2011 2012
131 131

Volume (x1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 91 102 392 130 92 100
Cream 2 100 1 77 51 104
Cheese 118 113 9 113 80 122
Skim milk powder 19 116 3 106 27 159
CONSUMPTION
Butter 9 5
Cheese 52
4
3.2
Milk 30.4 2
Butter 2.8 1
Cheese 16.3
0
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
In 2012, compared to 2011, the Lithuanian economy grew: GDP rose by 6.4%, gross wages and salaries
increased by 4.5%, the unemployment rate fell by 2.2% point to 13.2%, retail trade, except trade of motor
vehicles, which rose by 3.9% and exports of Lithuanian-origin goods increased by 9.4%.
In 2012, compared to 2011, exports of dairy products grew by 14% and exports of raw milk rose by 3.3%. In
December 2012, compared to the same month in 2011, the average prices of dairy products exported by the
Lithuanian milk processing industry increased by 6.5%, and prices of dairy products sold on the domestic
market decreased by 3.5%. In 2012, compared to 2011, the average milk (3.4% fat, 3.0% protein) purchase
price fell by 8.8%.
In 2011, compared to 2010, per capita consumption of dairy products, expressed in milk equivalent, rose by
8% and was 283 kg per year. Per capita consumption of dairy products sold through retail trade chains
increased as well.
As a member of the EU, Lithuania has all elements of the EU dairy policy. During the 2011-2012 quota year,
the implementation rate of the total national milk sales quota for processing was 79% and 54% for direct
consumption. In 2012, while the situation on the global dairy market was good, export refunds were not
implemented and intervention for dairy products was not necessary.
The average dairy farm in Lithuania is small. In 2012, the average dairy farm had 4.5 cows. But dairy farms
are becoming larger. The number of farms with 19 cows is rapidly decreasing and number of farms with
more than 30 cows is increasing. The milk processing industry is highly concentrated. In 2012, four main
groups received about 80% of total dairy sector revenue.
Source: National Committee of the IDF, Lithuanian Institute of Agrarian Economics (www.laei.lt), PRB.
132 132
LUXEMBOURG
DAIRY FARMING
Key figures
EU 27

290 50
280 40
278
270 30
F 4.1% F 4.2%
F 4.2% P 3.4%
260 20 P 3.4% P 3.4%
250 10
240 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Luxlait www.luxlait.lu
Fromagerie de Luxembourg -
TRADE
Export Import
50 75
40 60
30 45
20 30
10 15
0 0
2005 2011 2012 2005 2011 2012
133 133

Production (A) Import Export
Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk (B) - - 13 104 7 53
Cream - - 4 158 4 192
Butter and butteroil - - 4 100 2 93
Cheese - - 59 111 49 111
(A) Confidential. (B) Trade of liquid milk in small package.
CONSUMPTION
Milk (C) 20 mln inhabitants
Butter 3 5
Cheese 13
4
Milk (C) 38.0 2

Butter 6.1 0.5
1
Cheese 24.4
0
2005 2006 2007 2008 2009 2010 2011 2012
(C) Including buttermilk.
KEY DEVELOPMENTS
Structural changes are still ongoing in the dairy sector, marked by the planned abolition of the milk quota
system in 2015. The observed drop in total milk production is mainly due to lower nutrient levels of forage fed
to dairy cows because of extended rainfall in spring and summer.
Compared to 2011, the average milk price paid to farmers remained more or less stable. However, fertilizer
and feed prices are still high.
Source: National Committee of the IDF, Service dEconomie Rurale (www.ser.etat.lu), UN.
134 134
NETHERLANDS
DAIRY FARMING
Key figures
EU 27

12 000 50
11 675
11 600 40
F 4.4%
11 200 30 F 4.4%
F 4.4% P 3.5%
P 3.5%
P 3.5%
10 800 20
10 400 10
10 000 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Royal FrieslandCampina www.frieslandcampina.com
DOC Kaas www.dockaas.nl
Bel Leerdammer www.belgroup.nl
Vreugdenhil Dairy Foods www.vreugdenhil.nl
Cono Kaasmakers www.cono.nl
Production
850 250
800 200
750 150
700 100
650 50
600 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
750 250
600 200
450 150
300 100
150 50
0 0
2005 2011 2012 2005 2011 2012
135 135

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 524 99 671 95 492 87
Fermented products (A) 391 99 177 102 65 113
Cream 9 132 72 85 151 105
Cheese 764 102 214 97 731 106
(A) Production volume excluding added ingredients.
CONSUMPTION
Butter 55 19
Cheese 324
18
16.8
Milk 49.0 16
Butter 3.3 15
Cheese 19.4
14
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
Dairy farm income reduced

In the wake of (international) market development, Dutch dairy farmers saw their income from milk drop
somewhat in 2012. Average milk prices remained more than 8% below those in the peak year 2011. Besides
less milk money, dairy farmers also faced higher input costs, especially for feed. These factors all had a
negative effect on the balance.
Deliveries remain within quota
Dutch milk quota for deliveries to factories (11.9 bln kg) was not fully utilized in 2012/13. A poor supply of
roughage feed, combined with relatively cold weather during the winter and early spring, had a negative effect
on milk production. The resulting shortfall (-0.37%) meant that Dutch dairy farmers were not required to pay a
superlevy for the first time since the 2005/06 quota year.
Scaling up in dairy farms continues
The trend towards larger-scale operations in Dutch dairy farming continued. In the 2012/13 quota year, the
number of quota holders declined further to just over 18 000 (-2.1%). Only the number of relatively larger dairy
farms increased. Nowadays, the category of farms with a quota of 1 mln kg or more constitutes 15% of the
total population, while representing almost one third of the national milk quota.
Dairy industry in investment mode
In anticipation of the abolishment of the quota system and the expected greater volume of milk, the Dutch
dairy industry is in the process of expanding capacity. For the next few years, investments for at least 700 mln
EUR will involve both greenfield dairy plant projects and expansion of existing facilities. Most of this will take
place in the northern part of the country.
Dutch Dairy Board ceases to exist
In October 2012, the political decision was made to abolish a system of public sector organizations, including
the Dutch Dairy Board (PZ). Since 1956, PZ has played a vital role in supporting the Dutch dairy sector in its
development. On top of this, the organization is well engaged in international networks like IDF, OECD and
FAO. Stakeholders in the dairy sector are striving to secure vital PZ activities in an organization on a private
basis.
Source: National Committee of the IDF, Productschap Zuivel (www.prodzuivel.nl), national statistics.
136 136
POLAND
DAIRY FARMING
Key figures
EU 27

1 000 tonnes PLN per 100 kg
10 500 125
9 818
10 000 100
9 500 75
9 000 50
8 500 25
8 000 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Mlekpol www.mlekpol.com.pl
Mlekovita www.mlekovita.com.pl
Polmlek www.polmlek.com
Danone www.danone.pl
Hochland www.hochland.pl
Production
800 200
700 160
600 120
500 80
400 40
300 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
200 75
60
150
45
100
30
50
15
0 0
2005 2011 2012 2005 2011 2012
137 137

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 2 824 100 135 168 288 112
Cream 357 105 17 75 54 72
Cheese 710 106 51 100 177 117
Skim milk powder 116 101 19 73 78 93
CONSUMPTION
Butter 155 40
Cheese 434
39
38.2
Milk 42.2 37
Butter 4.1 36
Cheese 11.4
35
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
In the second half of 2012, the domestic milk market was under the impact of two contradictory trends. On the
one hand, the economic situation on the world market improved, on the other, necessity appeared to limit milk
supply for fear of exceeding the milk quota and paying severe penalties.
In the second half of the year, a high risk, bordering on certainty, of exceeding the national quota resulted,
above all, in increasing the reduction rate of the dairy cow population to 4.1%. It enabled a decrease in
production growth dynamics and milk sales, despite higher efficiency of 5.1% by cows. As a result, in 2012
milk production grew by 2.1% to 12.66 bln kg. Despite the definite decrease of dynamics in the third, and in
particular the fourth quarter, milk procurement throughout 2012 increased by 6% to 9 584 mln litres as
compared to the last year. Due to a drop in milk procurement in the first quarter of 2013, the milk quota in the
2012/13 season was overshot only marginally (0.1%).
Restructuration processes, which are faster at the production stage in farms than in milk processing, are in
progress. The total number of farms keeping dairy cows decreased to 364 000, and that of suppliers of milk to
dairies to less than 171 000. In 2012, these milk suppliers kept about 11 cows and supplied 56.1 thousand
litres (58.2 thousand kg) of milk, on average. Milk production in Poland remains, one of the most fragmented
in the EU.
Because of a slight growth in production and consumption, the surplus of supply over the national
consumption remained almost unchanged (11.8%). Statistical consumption of dairy products and butter
expressed in terms of the raw milk equivalent amounted to 280 kg per capita. This followed on from a growth
in the consumption of dairy products by approximately 1% (to 196 litres per capita), and a decrease in the
consumption of butter. The growth of dairy product consumption was stimulated by the slower growth
dynamics of retail prices than the previous year.
Source: National Committee of the IDF, Fundacja Programw Pomocy dla Rolnictwa (www.fapa.org.pl),
Comtrade, PRB.
138 138
PORTUGAL
DAIRY FARMING
Key figures
EU 27

2 100 50
2 000 40
1 863
1 900 30
F 3.9% F 3.9%
F 3.9% P 3.1%
1 800 20 P 3.1%
P 3.1%
1 700 10
1 600 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Lactogal www.lactogal.pt
Lactaores www.lactacores.pt
Fromageries Bel www.bel-group.com
Insulac www.insulac.pt
Danone www.danone.pt
Production
100 50
80 40
60 30
40 20
20 10
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese (A) Butter/-oil WMP SMP
(A) All kinds of milk.
TRADE
Export Import
50 50
40 40
30 30
20 20
10 10
0 0
2005 2011 2012 2005 2011 2012
139 139

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 859 101 207 87 290 106
Fermented products (B) 134 100 146 96 20 117
Cream 18 103 12 73 28 205
Cheese (C) 72 100 35 94 17 174
(B) Production: year 2011. (C) All kinds of milk.
CONSUMPTION
Butter 19 13
Cheese 102
12
10.6
Milk 81.0 10
Butter 1.8 9
Cheese 9.6
8
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
The main market driving force during 2012 was the economic and financial crises that have affected Portugal
since 2010, and the consequent external financial aid programme, which has enormous consequences on
family budgets and, of course, on consumption, including essential goods such as milk and other dairy
products.
In fact, in the last couple of years we have seen a drop in dairy product consumption, in volume, but
particularly in terms of value, which shows a change in consumer trends towards cheaper products. Recent
studies indicate that consumer standards in Portugal, when it comes to food, have gone backwards some 20
years, and now consumers choose less complex and more basic products.
That has some tremendous effects on the whole value chain, all the way to the producers. If we add in the fact
that 2 main retailer groups in Portugal are responsible for 2/3 of total dairy commerce, pressure for industry
and producer margins is huge. This is how lower prices can be explained for milk prices paid to producers in
2012 when compared to the EU average. Also, the foreseen milk quotas ending in 2015 and the political
measures decided in 2008, including national quota increases, resulted in higher market pressure for
Portugal.
Source: National Committee of the IDF, national statistics, Eurostat, UN.
140 140
SLOVAKIA
DAIRY FARMING
Key figures
EU 27
% of worldwide milk production 0.2% Number of dairy farms (A) 615

1 100 50
1 000 40
851
900 30
F 3.8%
F 3.8%
800 F 3.8% P 3.4%
20 P 3.4%
P 3.3%
700 10
600 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Rajo www.rajo.sk
Agro Tami www.agrotami.sk
Tatranskmliekare www.tami.sk
Euromilk www.euromilk.sk
Koliba www.koliba.sk
Production
50 25
40 20
30 15
20 10
10 5
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
75 75
60 60
45 45
30 30
15 15
0 0
2005 2011 2012 2005 2011 2012
141 141

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 318 107 94 83 227 88
Cream 32 92 13 88 8 91
Cheese 33 104 35 100 26 111
CONSUMPTION
Butter 16 8
Cheese 55
7
5.4
Milk 54.9 5
Butter 2.9 4
Cheese 10.1
3
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
Dairy cow numbers carried on falling by 2.4% in 2012. Average yield per cow rose by 5.9% to 6 295.5 kg.
Annual milk production increased by 3.4%, and deliveries to dairies (88.7% of total milk) by 4.9%. Of the
purchase by approved buyers, 97.5% of milk met parameters of quality class Q and I. In quota year 2012/13,
Slovakia used only 80% of the 1 104 709 tonnes national quota (without fat correction).
The average milk price in 2012 was 29.46 EUR/100 kg, -6.8% vs. 2011. Processor prices for selected
products increased: Edamer cheese (45% fat) by 0.7%, natural yoghurt (3-10% fat) by 3.0%, and others
decreased: butter (consumer ready) by 7.3%, WMP by 7.4%, SMP by 4.1% and butter blocks by 9.4%.
Consumer prices for milk products increased between 2.7% (unsweetened condensed milk) and 14.5% (liquid
milk 1.5% fat).
In 2012 per capita consumption of dairy products (preliminary Statistical Office figures) increased by 1.0% to
158.5 kg milk equivalent (butter excluded). Consumption of liquid milk increased by 3.2% and fermented dairy
products by 0.7%, butter declined by -7.1%; cheese by -2.9% and cream by -0.4%. Processed cheese
consumption declined the most (-10.5%) to 1.7 kg.
The policy in the Slovak dairy sector is governed by Community law and national legislation. In 2012 the
Commodity Council for Milk was established by the Ministry of Agriculture.
During the September 2011-July 2012 period, 3 161 tonnes of dairy products (equivalent to 2 001 thousand
EUR) were supported in the school milk programme, with 1 679 schools participating.
In 2012, production of the following important dairy products increased significantly: liquid milk by 7.0%,
natural cheeses by 4.5%, butter and other milk fats by 7.0%, fermented dairy products (including yoghurts) by
14.3% and whole milk powder by 52.4%.
On the other hand, production of following products has decreased: skim milk powder by 14.2%, sheep
cheese by 5.2%, cream by 8.2% and processed cheeses by 1.4%.
Source: National Committee of the IDF, Agricultural Paying Agency (www.apa.sk), Comtrade, PRB.
142 142
SPAIN
DAIRY FARMING
Key figures
EU 27

6 400 50
6 115
6 200 40
6 000 30
F 3.7% F 3.7% F 3.7%
5 800 20 P 3.1% P 3.1% P 3.1%
5 600 10
5 400 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Lactalis Iberia www.lactalis.com
Capsa www.capsa.es
Leche Pascual www.lechepascual.es
Leche Celta www.lechecelta.com
Ilas www.renypicot.es
Production
250 75
200 60
150 45
100 30
50 15
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese (A) Butter/-oil WMP SMP
(A) Cows milk cheese.
TRADE
Export Import
100 300
80 240
60 180
40 120
20 60
0 0
2005 2011 2012 2005 2011 2012
143 143

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 3 492 97 485 116 153 123
Cream 153 138 13 12 58 151
Cheese (B) 113 85 250 97 56 112
Skim milk powder 12 241 46 85 20 135
(B) Production: cows milk cheese only (all milk cheeses: 322 600 tonnes in 2012).
CONSUMPTION
Butter 26 48
Cheese 436 46.8
47
Milk 83.2 45
Butter 0.6 44
Cheese 9.3
43
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
During 2012 the number of milk production farms continued to decrease. However the volume of production
increased slightly. There have been no relevant structural changes in the industry.
The price paid to farmers fell from January to August, with a rise from September, however the level at the
end of the year was 2.3% lower than in December 2011.
The costs of feeding cattle remain at a high level.
The retail prices of liquid milk and fermented milks fell but, in the case of cheeses, prices increased by 0.3%
since the previous year.
Liquid milk consumption in 2012 fell by 0.4%. The consumption of all dairy products has remained stable but,
for example, fermented milks have dropped by 2% and cheeses by 0.6%. In the short term, overall
consumption is not expected to increase.
The imports of liquid milk, both bulk and packaged, increased in 2012. On the contrary, the imports of most
dairy products decreased. Exports increased, except whole milk and butter.
There have been significant changes in dairy policy as a result of the change of government. The new
Administration considers the dairy sector strategic and in a difficult situation, so it has initiated the
implementation of several measures to improve value along the whole dairy chain.
Source: National Committee of the IDF, Federacin Nacional de Industrias Lcteas (www.fenil.org),
Ministerio de Agricultura, Alimentacin y Medio Ambiente, Comtrade, UN.
144 144
SWEDEN
DAIRY FARMING
Key figures
EU 27

1 000 tonnes SEK per 100 kg
3 500 500
3 300 400
3 100 300 F 4.2% F 4.2%

F 4.2%
2 861 P 3.4% P 3.4%
P 3.4%
2 900 200
2 700 100
2 500 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Arla www.arlafoods.se
Sknemejerier www.skanemejerier.se
Norrmejerier www.norrmejerier.se
Falkpings Mejeri www.falkopingsmejeri.se
Gsene mejerifrening www.gasenemejeri.se
Production
125 50
115 40
105 30
95 20
85 10
75 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
50 125
40 100
30 75
20 50
10 25
0 0
2005 2011 2012 2005 2011 2012
145 145

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 867 99 12 23 74 77
Cream 113 103 34 122 1 50
Cheese 101 98 102 112 19 124
CONSUMPTION
Butter 17 12
Cheese 187
11
9.4
Milk 92.1 9
Butter 1.8 8
Cheese 19.7
7
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
The average herd has 70 milking cows. There was a lower producer price than in 2011, but rising prices in the
middle of 2013. There is a higher consumption of drinking milk, cream, butter and cheese but lower
consumption of fermented products, and a higher ratio for branded products of all dairy categories.
Source: National Committee of the IDF, Swedish Dairy Association (www.svenskmjolk.se), UN.
146 146
UNITED KINGDOM
DAIRY FARMING
Key figures
EU 27

1 000 tonnes GBP per 100 kg
15 000 50
14 500 40
14 000 30
13 500 F 4.0% F 4.1%

20 F 4.0%
13 591 P 3.3% P 3.3%
P 3.3%
13 000 10
12 500 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Arla Milk Link www.arlamilklink.co.uk
Mller Wiseman Dairies www.muller-wiseman.co.uk
Dairy Crest www.dairycrest.co.uk
First Milk www.firstmilk.co.uk
Glanbia www.glanbia.com
Production
400 150
370 130
340 110
310 90
280 70
250 50
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese Butter/-oil Milk powder
TRADE
Export Import
150 500
120 400
90 300
60 200
30 100
0 0
2005 2011 2012 2005 2011 2012
147 147

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 6 943 99 162 102 548 95
Cream 250 101 67 119 29 39
Cheese 355 100 439 106 126 101
Milk powder 89 79 72 112 75 95
- Whole milk powder - - 22 106 51 94
- Skim milk powder - - 50 115 24 99
CONSUMPTION
Butter 211 65
Cheese 703 62.8
63
Milk 106.2 59
Butter 3.4 57
Cheese 11.2
55
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
Further rationalisation has taken place with the merger of European co-operative Arla Foods and UK co-
operative Milk Link to create the UKs largest dairy company Arla Foods UK. The strong levels of milk
production seen since May 2010 came to an end with prolonged bad weather in late 2012 and early 2013
leaving production for the year 3.6% down on 2011/12 and the UK 9.8% below quota. Production levels,
however, started to recover in May.
UK wholesale prices recovered strongly from the recent lows of mid-2012 with the May prices for butter
(+60%), SMP (+65%) and cream (+71%) all higher than a year before. The improved returns have been
reflected in higher farm gate prices and further increases have been announced by the major buyers for the
months ahead.
The liquid market continues to show growth with sales up by 1.3% in the year up to May and the cheese
market also increased, by 1.5% in volume and 3.7% in value, over the year to March. Production of cheese
and butter continued to grow in 2012 but condensed milk, and especially milk powders, were down on 2011
levels.
Many companies have signed up to the Voluntary Code of Best Practice on Contractual Relationships, which
sets out good practice for contracts between producers and purchasers. There are significant challenges to
dairy in terms of public health in the UK particularly in relation to salt, saturated fat and front of pack labelling -
the industry is working constructively with the Department of Health to address concerns in these areas. 2013
saw the publication of a new, expanded Dairy Roadmap report, reporting on progress made towards achieving
targets set to minimise the dairy industrys environmental impact throughout the milk supply chain.
Source: National Committee of the IDF, Dairy UK (www.dairyuk.org), PRB.
148 148
CANADA
DAIRY FARMING
Key figures
NORTH AND CENTRAL AMERICA

1 000 tonnes CAD per 100 kg
8 500 100
8 196
8 300 80
8 100 F 3.6% F 3.6% F 3.6%

60
P 3.2% P 3.2% P 3.2%
7 900 40
7 700 20
7 500 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Saputo www.saputo.com
Agropur Cooperative www.agropur.com
Parmalat www.parmalat.ca
Kraft www.kraftcanada.com
Danone www.danone.ca
Production
370 150
350 130
330 110
310 90
290 70
270 50
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese Butter SMP
TRADE
Export Import
25 50
20 40
15 30
10 20
5 10
0 0
2005 2011 2012 2005 2011 2012
149 149

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk (A) 2 774 100 34 106 5 125
Cream 347 112 4 60 0 0
Cheese 341 102 26 102 10 110
(A) Including chocolate milk and eggnog. (B) Production of butter and whey butter only.
CONSUMPTION
Milk (C) 2 774 mln inhabitants
Butter 99 36
Cheese 422 34.9
35
Milk (C) 79.5 33

Butter 2.8 32
Cheese 12.1
31
2005 2006 2007 2008 2009 2010 2011 2012
(C) Including chocolate milk and eggnog.
KEY DEVELOPMENTS
The Canadian economy is stable. However, a resumption of previous growth rates for developed countries
(around 3%) is not expected in the short-term. As such, overall consumption for dairy products remain
unchanged; a decline in fluid milk consumption per capita has been balanced by slight growth for cheese, and
moderate growth in the overall yogurt category, but stronger in the Greek-style category.
The Canadian dairy industry continues to consolidate. Farm numbers declined while cows per farm increased.
Resources continue to flow to milk quality, farm safety, animal welfare, traceability and biosecurity programs.
Producers are considering proposals that would make farm certification for these elements mandatory to meet
evolving market demand.
Production was fairly high last year leading to an increased surplus of skim milk powder and butter. As in
previous years some surplus skim milk powder was exported although these amounts are limited to that
allowed by Canadas World Trade Organization commitments. Canada has not exported a lot of butter in
recent years but policy changes in 2012 to allow more milk in the system has created some exportable
surplus.
Source: National Committee of the IDF, Agriculture & Agri-Food Canada (www.dairyinfo.gc.ca), PRB.
150 150
MEXICO
DAIRY FARMING
Key figures

1 000 tonnes MXN per 100 kg
12 000 600
11 000 500
9 583
10 000 400
9 000 300
8 000 200
7 000 100
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
(A) Real fat and protein contents.
PROCESSING INDUSTRY
Main processors
Grupo Lala www.lala.com.mx
Nestl Mexico www.nestle.com.mx
Alpura www.alpura.com.mx
Grupo Agroindustrial Zaragoza www.aiz.com.mx
Lechera Guadalajara www.sellorojo.com.mx
Production
300 100
240 80
180 60
120 40
60 20
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese WMP Butter/-oil SMP
TRADE
Export Import
15 300
12 240
9 180
6 120
3 60
0 0
2005 2011 2012 2005 2011 2012
151 151

Volume (x1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 3 847 88 30 122 13 178
Cream 124 116 9 92 2 141
Cheese 292 106 99 126 4 99
CONSUMPTION
Butter 39 120
Cheese 356 116.1
116
Milk 35.9 108

Butter 0.3 104
Cheese 3.1
100
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
Mexico has a new federal government and new strategies are planned to increase productivity, hope and
support to livestock milk producers.
In relation to the industry, likewise some structures have been modified and now have greater access to
banking, and interest is expected to lower.
Even though the producers price of milk to the final consumer is the same in all categories, the end price is
"fixed" by the consumer.
Dairy consumption has manifested as the industry has grown in the field of beverages and fruit flavored
yoghurts, soft cheeses and growing markets like Cotija Mexican cheese and several more.
Free trade agreements have been established with several countries and quotas fixed for some products such
as milk, whey powders, and some others; Mexico is now in the Trans/Pacific Partnership with 11 Pacific and
Central American countries.
Mexico trusts the government to prepare and introduce new policies to encourage production and preserve
the national industry. There are new guidelines to set policies to improve the environment, especially
concerning livestock producers.
The country is enjoying economic stability and peace in the industry; however the increasing imports of raw
materials and finished products hinder the small producer. LICONSA is a buyer of fresh milk at a low price that
keeps the Mexican dairy sector afloat under pressure, but the growth seen is not the desired amount.
Source: National Committee of the IDF, FAPRI, Lactodata, SIAP, PRB.
152 152
UNITED STATES OF AMERICA

DAIRY FARMING
Key figures

(A) Farm operations with a licence to market milk.

1 000 tonnes USD per 100 kg
95 000 50
90 429
91 000 40
F 3.7%
F 3.7%
87 000 30 F 3.7%
83 000 20
79 000 10
75 000 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Dairy Farmers of America www.dfamilk.com
Dean Foods Company www.deanfoods.com
Kraft Foods www.kraftfoodscompany.com
Schreiber Foods www.schreiberfoods.com
Land O'Lakes www.landolakes.com
Production
5 500 1 000
5 000 800
4 500 600
4 000 400
3 500 200
3 000 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
500 250
400 200
300 150
200 100
100 50
0 0
2005 2011 2012 2005 2011 2012
153 153

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 23 972 98 53 713 56 109
Fermented products (B) 2 003 103 10 188 13 106
Cream 1 638 97 3 >1 000 9 -
Cheese 4 940 103 154 108 260 116
Skim milk powder 978 110 2 380 445 102
(B) Production of yoghurt only.
CONSUMPTION
Butter 788 350
Cheese 4 774
330
313.9
Milk 76.4 290

Butter 2.5 270
Cheese 15.2
250
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
The number of licensed dairy herds continues to decline in the United States, while the average herd size
continues to grow, from 172 cows in 2010 to 187 cows in 2012.
Between 2010 and 2012, average retail prices rose by 7% for liquid milk, butter and processed cheese, by
14% for ice cream and by 20% for natural cheddar cheese.
Consumption in the US domestic market was 2.7% higher, adjusted for leap year, in 2012 than in 2010 for all
cheese, 13.3% higher for butter, and 3.6% lower for liquid milk.
The United States Congress failed to enact new dairy legislation as part of a comprehensive Farm Bill last
year, but extended the expiring farm bill through 2013 instead. As of June this year, the Congress is on track
to pass the Farm Bill, which includes a major new policy approach for the dairy industry. It will replace the
current Dairy Product Price Support Program and Milk Income Loss Contract (MILC) payments with a system
of supplemental payments to dairy farmers whenever the margin between the milk price and the cost of dairy
feed falls below specified levels.
Dairy farmers could select their individual level of margin protection, but would have to pay a premium for
coverage above a minimum level. Farmers who elect to receive margin protection under the program would
also be subject to small reductions in their volumes of base milk marketings on which they would be paid
during short periods when the price-cost margin falls below various specified trigger levels.
Source: National Committee of the IDF, National Milk Producers Federation (www.nmpf.org), PRB.
154 154
ARGENTINA
DAIRY FARMING
Key figures
(A) 2011 figures.

1 000 tonnes ARS per 100 kg
12 000 200
11 200 10 876
160
F 3.6%
10 400 120 F 3.6% P 3.3%
F 3.6% P 3.3%
9 600 80 P 3.3%
8 800 40
8 000 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Mastellone www.laserenisima.com.ar
SOUTH AMERICA
SanCor Cooperativas Unidas www.sancor.com.ar

Molfino -
Danone Argentina www.danone.com
Sucesores Alfredo Williner www.williner.com.ar
Production
600 60
500 50
400 40
300 30
200 20
100 10
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
1 000 tonnes
600
TRADE
500
Export Import
1 000400
tonnes 1 000 tonnes
250
300 10
200
200 8
150
100 6
2005 2007 2009 2011
100 Cheese WMP 4
50 2
0 0
2005 2011 2012 2005 2011 2012
155 155

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 1 861 105 - - 5 36
Cream 38 87 - - 1 -
Cheese 538 103 4 113 59 97
Whole milk powder 278 100 1 - 218 108
CONSUMPTION
Butter 57 42
Cheese 458 40.8
41
Milk 42.7 39
Butter 1.4 38
Cheese 11.3
37
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
At farm level, the trend outlined in the report from 2011 regarding the continuous increase in farm sizes still
holds true. For a sample of dairy farms supplying about 60% of the milk produced in Argentina, the average
daily output in 2011 was 2 820 litres, and the output for 2012 was 2 950 litres. Some companies even reported
an increase in the number of suppliers during 2012. At the manufacturing stage, several companies have
developed expansion plans, to be completed in 2013 and 2014, with an estimated increase of 10-15% in the
processing capacity at the end of 2014.
Producer prices in 2012 averaged 0.3446 USD/litre, a 5.6% reduction in comparison with 2011.
Consumption in 2012 was (approximately) 209 litres of milk equivalent per capita, about the same level as in
2011.
There have been no significant changes in dairy policies. Some ad-hoc controls in the domestic and export
markets are still in place.
The countrys economy in 2012 showed an increase of 1.9%, a sharp reduction in comparison with the year
2011, when the GDP growth rate was 8.9%. However, the Government of Argentina was able to sustain
domestic consumption with a mixture of heterodox economic measures.
Source: Centro de la Industria Lechera (www.cil.org.ar), Dairy Cooperatives Association, national statistics,
PRB, Comtrade.
156 156
BRAZIL
DAIRY FARMING
Key figures
% of worldwide milk production 5.3% Number of dairy farms 1 050 000

1 000 tonnes BRL per 100 kg
25 000 100
23 009
23 000 80
F 3.8% F 3.8%
21 000 60 P 3.3% P 3.3%
F 3.8%
P 3.3%
19 000 40
17 000 20
15 000 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors (A)
DPA/Nestl www.nestle.com.br
LBR www.lacteosbrasil.com.br
Itamb www.itambe.com.br
SOUTH AMERICA
Italac www.italac.com.br
Laticnios Bela Vista www.piracanjuba.com.br
(A) Brasil Foods not ranked.
Production
900 150
800 130
700 110
600 90
500 70
400 50
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
50 125
40 100
30 75
20 50
10 25
0 0
2005 2011 2012 2005 2011 2012
157 157

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk - - 12 85 0 100
Cream - - - - - -
Cheese 700 103 28 74 3 78
Skim milk powder 141 107 34 108 27 -
CONSUMPTION
Butter 88 204
Cheese 725 198.7
200
Milk 59.0 192

Butter 0.4 188
Cheese 3.6
184
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
The dairy sector in Brazil has been growing 4-5% per year. Estimates point to sustained growth, particularly in
the Southern states. Production systems have been increasingly efficient, focusing on irrigated pasture
feeding and supplemented silage. Following a worldwide trend, dairy operations in Brazil are merging for
optimal competitiveness. Yet the country is also a major dairy importer, particularly from Mercosur countries
such as Argentina and Uruguay.
Several government-sponsored programs have been established for the dairy chain in light of national efforts
for environmental and economic sustainability. Domestic demands for dairy continue to grow as the average
population income keeps rising. As such, animal husbandry and breeding as well as dairy quality and safety
are being particularly strengthened by national programs based on competitive, cutting-edge research and
development efforts.
Source: National Committee of the IDF, Embrapa Gado de Leite (www.cnpgl.embrapa.br), Milkpoint,
Comtrade, USDA, UN.
158 158
CHILE
DAIRY FARMING
Key figures
(A) Year: 2011.

1 000 tonnes 1 000 CLP per 100 kg
2 700 25
2 504
2 500 20
2 300 15
2 100 10
1 900 5
1 700 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Colun www.colun.cl
Soprole www.soprole.cl
Nestl www.nestle.cl
SOUTH AMERICA
Watt's www.watts.cl
Surlat www.surlat.cl
Production
125 25
100 20
75 15
50 10
25 5
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese (C) WMP Butter/-oil SMP
(C) Based on big dairies production; total production of cheese (including small dairies): ~130 700 tonnes.
TRADE
Export Import
20 20
16 16
12 12
8 8
4 4
0 0
2005 2011 2012 2005 2011 2012
159 159

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 401 105 - - 0 8
Cream 35 110 - - 0 27
Cheese 91 102 18 169 8 80
Skim milk powder 19 102 10 149 4 245
CONSUMPTION
Butter 21 19
Cheese 141 17.4
18
Milk 23.0 16
Butter 1.2 15
Cheese 8.1
14
2005 2006 2007 2008 2009 2010 2011 2012
Source: National Committee of the IDF, Oficina de Estudios y Polticas Agrarias, Instituto Nacional de
Estadstica, PRB, FAO.
160 160
COLOMBIA
DAIRY FARMING
Key figures

1 000 tonnes 1 000 COP per 100 kg
4 000 125
3 539
3 700 100
3 400 75
3 100 50
2 800 25
2 500 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
(A) Fat: 3.45% - 3.80%, protein: 3.00% - 3.80%.
PROCESSING INDUSTRY
Main processors (B)
Colanta www.colanta.com.co
Alqueria www.alqueria.com.co
Nestl www.nestle.com.co
SOUTH AMERICA
Alpina www.alpina.com.co
Lactalis www.parmalat.com.co
Production
150 10
120 8
90 6
60 4
30 2
0 0
2009 2010 2011 2012 2009 2010 2011 2012
TRADE
Export Import
15 75
12 60
9 45
6 30
3 15
0 0
2005 2011 2012 2005 2011 2012
161 161

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 2 570 111 0 0 0 0
Cream 21 105 0 0 0 1
Cheese 42 102 0 0 1 107
CONSUMPTION
Butter 7 50
Cheese 45 47.7
48
Milk 61.3 44
Butter 0.1 42
Cheese 0.9
40
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
Farming and milk production have remained stable in the last year, no important changes noted.
Consumption trend in the white milk segment continues to change from chilled to longlife milk and raw milk
consumption continues to be stable as there has been no government enforcement to act upon this milk
segment up to now.
Producers are worried about the effects of FTA signed recently by the government and its effects on
competitiveness in the market as they need to level on efficiency, quality and innovation but still lack the
infrastructure in the country. Besides, their main concern is competing with markets such as the US, where
producers receive government aid, putting them at a commercial disadvantage.
High internal prices of milk have had an impact on the rise in imports of milk powder which made the
government react under the pressure of producers to raise the customs duty for milk powder.
Economic growth means that Colombia remains one of the rising stars in Latin America with a major
improvement in business environment and abundant resources that gives reason to believe the country will
continue to do well.
Source: Tetra Pak Ltda.(www.tetrapak.com/co), Fedegan, Comtrade, UN.
162 162
URUGUAY
DAIRY FARMING
Key figures

1 000 tonnes UYU per 100 kg
2 500 1 000
2 200 800
1 994
F 3.7% F 3.7%
1 900 600 P 3.3%
F 3.7% P 3.3%
1 600 400 P 3.2%
1 300 200
1 000 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Conaprole www.conaprole.com.uy
Ecolat www.ecolat.com
Indulacsa www.indulacsa.com.uy
SOUTH AMERICA
Calcar www.calcar.com.uy
Pili www.pili.com.uy
Production
75 50
60 40
45 30
30 20
15 10
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
100 5
80 4
60 3
40 2
20 1
0 0
2005 2011 2012 2005 2011 2012
163 163

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 263 96 0 - 40 113
Fermented products (A) 36 104 6 90 4 58
Cream (B) 9 100 0 - 1 1.045
Cheese 69 114 1 126 47 101
Whole milk powder (C) 58 104 0 122 60 103
Skim milk powder (C) 34 122 1 143 33 116
(A) Production of yoghurt only. (B) Production: year 2011. (C) Production: year 2012 estimated.
CONSUMPTION
Butter 5 5
Cheese 21 3.4
4
Milk 69.2 2
Butter 1.6 1
Cheese 6.0
0
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
The milk production systems in Uruguay are migrating towards greater inclusion of concentrates in the diet
(30-40%), which has increased production costs.
Dairy consumption has stabilized from a few years ago, 240 litres/capita/year. Growth in production is
specifically destined for export.
Hard work is currently being carried out on environmental issues in order to strengthen the sustainability of
production systems.
The economic situation has not been the best in 2012 for Uruguayan dairy. The drop in prices on the
international market accompanied by significant rainfall in the spring, which did not allow projected pasture
consumption volumes, affected the profitability of the business.
Source: Instituto Nacional de la Leche (www.inale.org), national statistics, PRB.
164 164
BELARUS
DAIRY FARMING
Key figures
(A) Year : 2010.
Cow milk production Cow milk prices (F = fat%, P = protein%)

1 000 tonnes 1 000 BYR per 100 kg
7 500 300
6 754
7 000 240
6 500 180
6 000 120
5 500 60
5 000 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Savushkin product www.savushkinproduct.com
Babushkina Krynka www.babushkina.by
Slutski www.slsk.by
Molochnye Produkty www.gomelmilk.com
Gormolzavod Nr 1 -
Production
200 100
170 80
140 60
110 40
OTHER EUROPE
80 20
50 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese Butter WMP SMP
TRADE
Export Import
150 5
120 4
90 3
60 2
30 1
0 0
2005 2011 2012 2005 2011 2012
165 165

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk (B) 1 776 108 12 132 350 163
Butter and butteroil (C) 113 108 0 185 85 131
Cheese 147 104 3 117 143 108
Whole milk powder (D) 40 123 1 445 34 127
Skim milk powder (D) 77 137 1 830 76 138
(B) Including fermented products, milk drinks and cream. (C) Production of butter only. (D) Production: year 2012 estimated.
CONSUMPTION
Butter - 12
Cheese -
11

9.4
Milk - 9
Butter - 8
Cheese -
7
2005 2006 2007 2008 2009 2010 2011 2012
Source: Comtrade, FAO, national statistics, UN.
166 166
CROATIA
DAIRY FARMING
Key figures

1 000 tonnes HRK per 100 kg
1 000 300
800 240
602 F 4.0% F 4.0%
600 180 F 4.0% P 3.4% P 3.4%
P 3.4%
400 120
200 60
0 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Dukat www.dukat.hr
Vindija www.vindija.hr
Belje www.belje.hr
Meggle www.meggle-hrvatska.hr
Zdenka www.zdenka.hr
Production
50 10
40 8
30 6
20 4
OTHER EUROPE
10 2
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
5 15
4 12
3 9
2 6
1 3
0 0
2005 2011 2012 2005 2011 2012
167 167

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 304 89 79 111 25 83
Cream 26 102 3 100 1 180
Cheese 31 105 12 114 2 103
Whole milk powder 0 100 2 125 0 -
CONSUMPTION
Butter 4 7
Cheese 41
6

4.3
Milk 73.5 4
Butter 1.0 3
Cheese 9.6
2
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
An intense restructuring of the dairy sector in the Republic of Croatia in the previous period resulted in an
increase of dairy animals per farm, but the number of dairy farms, especially those delivering milk for dairy
processing, decreased in comparison to 2011.
The milk price decreased as a consequence of neighbouring countries market influence and preparation of
Croatias accession to the European Union. The credit load of farmers is still high and there have therefore
been no significant investments in the dairy sector, especially in milk production. The financial crisis in Croatia
influenced the rate of milk consumption.
Source: National Committee of the IDF, Agronomski fakultet Sveuilita u Zagrebu (www.agr.hr), Comtrade,
Eurostat, PRB.
168 168
ICELAND
DAIRY FARMING
Key figures

1 000 tonnes ISK per 100 kg
140 10 000
129
130 8 000
F 4.1% F 4.1%
120 6 000 F 4.1% P 3.3% P 3.3%
P 3.4%
110 4 000
100 2 000
90 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Mjlkursamsalan www.ms.is
Mjlkursamlag www.ks.is
Mjlka www.mjolka.is
Production
10 5
8 4
6 3
4 2
OTHER EUROPE
2 1
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
1.0 1.0
0.8 0.8
0.6 0.6
0.4 0.4
0.2 0.2
0.0 0.0
2005 2011 2012 2005 2011 2012
169 169

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 32 97 - - - -
Fermented products 11 92 - - - -
Cream 2 105 - - - -
Butter and butteroil 2 105 - - 1 100
Cheese 7 109 0 200 1 180
Whole milk powder 0 67 - - - -
Skim milk powder 1 82 - - 1 100
CONSUMPTION
Butter 2 1.0
Cheese 8
0.8
Consumption (kg per capita) 0.6

0.3
Milk 99.1 0.4
Butter 4.9 0.2
Cheese 25.2
0.0
2005 2006 2007 2008 2009 2010 2011 2012
Source: National Committee of the IDF, Icelandic Dairies Association (www.sam.is), UN.
170 170
NORWAY
DAIRY FARMING
Key figures
(A) Points of deliveries (joint farmers operations).

1 000 tonnes NOK per 100 kg
1 800 500
1 700 400 F 4.0% F 4.0%
F 4.0% P 3.4% P 3.4%
P 3.4%
1 600 300
1 531
1 500 200
1 400 100
1 300 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Tine www.tine.no
SynnveFinden www.synnove.no
Q-meieriene www.q-meieriene.no
Normilk www.normilk.no
Rrosmeieriet www.rorosmeieriet.no
Production
110 15
100 12
90 9
80 6
OTHER EUROPE
70 3
60 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
20 20
16 16
12 12
8 8
4 4
0 0
2005 2011 2012 2005 2011 2012
171 171

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk (B) 433 99 4 97 1 30
Fermented products 88 100 5 83 0 -
Cream 49 102 0 - 0 -
Cheese 85 101 11 105 13 95
Whole milk powder 1 100 0 - 0 -
Skim milk powder 10 111 0 - 2 500
(B) Including flavored milk.
CONSUMPTION
Butter 16 7
Cheese 89
6
5.0
Milk 86.6 4
Butter 3.2 3
Cheese 17.7
2
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
11 000 milk producers delivered cows milk in 2012, a reduction of 6% compared to 2011. Over the last 20
years, the yearly reduction has been 4% on average. Today there are 40 dairy plants in Norway, 36 of which
belong to Tine SA.
The milk price paid in 2012 was 4.79 NOK/litre or 0.62 EUR/litre. Since 2008 the milk price has increased by
0.85 NOK/litre (0.11 EUR/litre), or 23%. The consumer prices for dairy products have increased by 16%.
The consumption of liquid milk decreased by 2%, while consumption of yoghurt and cream are stable. Cheese
increased by 2% and consumption of butter by 34%.
Since Parliament approved a new agriculture policy in 2012, there has been a discussion of how to implement
the different goals of the policy. The income of a farmer is on average half of the income of an industrial
worker. The negotiation between farmers unions and the government, in May 2013, resulted in an increased
target price for milk by 5%.
An expanded trade agreement for cheese has been established within the EFTA group.
There is also work going on to implement new legislation to regulate ground rules in the value chain of the
food sector.
Advertizing towards children is a current topic at the moment. Flavored yoghurt and ice cream are products on
the list of unhealthy products. The legislation will not forbid advertizing, but the industry must implement a very
strict internal regulation system.
The economic situation is still excellent, but there are signs that point to reduced growth. The EU is the most
important trade partner for Norway.
Source: National Committee of the IDF, Tine SA (www.tine.no), Comtrade, PRB.
172 172
RUSSIA
DAIRY FARMING
Key figures
% of worldwide milk production 5.0% Number of dairy farms (A) 3 130 000
(A) Year : 2010.
Cow milk deliveries Cow milk prices (F = fat%, P = protein%) (B)

1 000 tonnes RUB per 100 kg
20 000 1 750
18 795
19 000 1 400
18 000 1 050
17 000 700
16 000 350
15 000 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Danone - Unimilk www.danone.ru
PepsiCo - Wimm Bill Dann www.wbd.ru
Voronezhskiy Dairy Plant www.molvest.ru
Production
500 200
400 160
300 120
200 80
OTHER EUROPE
100 40
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
50 600
40 480
30 360
20 240
10 120
0 0
2005 2011 2012 2005 2011 2012
173 173

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk (C) 4 860 100 492 261 16 359
Fermented products (C) 2 481 100 91 175 78 215
Cream (C) 80 100 31 199 2 262
Cheese 446 105 531 129 26 171
Skim milk powder 57 104 148 211 1 888
(C) Production: year 2011.
CONSUMPTION
Butter 404 145
Cheese 952
144
143.2
Milk 37.3 142

Butter 2.8 141
Cheese 6.6
140
2005 2006 2007 2008 2009 2010 2011 2012
Source: Russian Federal State Statistics Service, USDA, Agrarmarkt Informations-Gesellschaft, Comtrade,
PRB.
174 174
SWITZERLAND
DAIRY FARMING
Key figures

1 000 tonnes CHF per 100 kg
3 600 75
3 471
3 500 60
F 4.0% F 4.0% F 4.0%
3 400 45 P 3.3% P 3.3% P 3.3%
3 300 30
3 200 15
3 100 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Emmi www.emmi.ch
Cremo www.cremo.ch
Hochdorf www.hochdorf.com
Elsa Mifroma www.elsa.ch
Nestl www.nestle.ch
Production
200 50
190 40
180 30
170 20
OTHER EUROPE
160 10
150 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
100 75
80 60
60 45
40 30
20 15
0 0
2005 2011 2012 2005 2011 2012
175 175

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 481 99 23 86 2 283
Cream 70 100 2 114 3 69
Cheese 181 100 51 104 67 104
CONSUMPTION
Butter 42 10
Cheese 168
9
8.0
Milk 67.0 7
Butter 5.2 6
Cheese 21.1
5
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
In 2012 the total Swiss-GDP increased +1.0%. The domestic consumption increased by 1.4% and the Swiss
National Bank continued to stabilize the Swiss Franc at the minimal exchange rate of 1.2 CHF/Euro. For
external trade it was the same situation for the whole Swiss Economy as in 2011 (including the dairy
business).
Total milk consumption in Switzerland is about 370 kg per capita (2012). The retail prices for all dairy products
on the domestic market remained stable (average for all dairy products: +0.062%).
In the first six months of 2012, milk production continued increasing by +3% and after October the opposite
occurred (-5%). It was the first time after the abolishment of milk quota (2006/2009) that milk production
decreased. The farm gate price for milk decreased once more in 2012 (-3.5%) as a consequence of the
overproduction in the first part of the year. The segmentation system introduced by the Swiss Dairy Economy
on a private level in 2011 still works.
In 2012 the Swiss Parliament decided to examinate a free trade agreement between Switzerland and the
European Union (EU) for dairy products, but not for the rest of agricultural production.
Source: National Committee of the IDF, Swiss Milk Commission (www.swissmilk.ch), national statistics,
PRB.
176 176
UKRAINE
DAIRY FARMING
Key figures
(A) Year : 2011

1 000 tonnes UAH per 100 kg
6 500 350
6 000 280
5 500 210
5 000 140
4 650
4 500 70
4 000 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Wimm-Bill-Dann www.wbd.com
Danone www.danone.ua
Lactalis www.lactalis.com.ua
Milk Alliance www.unimilk.ru
Milkiland www.milkiland.com
Production
400 200
360 160
320 120
280 80
OTHER EUROPE
240 40
200 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
125 20
100 16
75 12
50 8
25 4
0 0
2005 2011 2012 2005 2011 2012
177 177

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 909 106 3 176 6 50
Cream 36 110 1 79 0 117
Cheese 244 96 17 137 67 84
Skim milk powder 44 123 3 186 26 118
CONSUMPTION
Butter - 48
Cheese -
47
45.6
Milk - 45
Butter - 44
Cheese -
43
2005 2006 2007 2008 2009 2010 2011 2012
Source: National statistics, USDA, PZ, PRB.
178 178
EGYPT
DAIRY FARMING
Key figures
Cow milk production (x 1 000 tonnes) 2 668 % cow milk deliveries 52%
% of worldwide milk production 0.4% Number of dairy cows (x 1 000 head) 1 608
Buffalo milk production (x 1 000 tonnes) 2 272 Number of buffaloes (x 1 000 head) 1 556
Milk production Milk prices (F = fat%, P = protein%)

1 000 tonnes EGP per 100 kg
3 500 350
3 100 280 F 3.0%

2 668 F 3.0%
P 3.4%
F 3.0% P 3.4%
2 700 210
P 3.4%
2 300 140
2 272
1 900 70
Cow milk Buffalo milk
1 500 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
PROCESSING INDUSTRY
Main processors
Juhayna www.juhayna.com
Lactalis www.lactelegypt.com
Domty www.domty.org
Greenland www.greenland-eg.net
Danone www.danone.com.eg
Production
750 75
600 60
450 45
300 30
150 15
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese Butter WMP
TRADE
Export Import
175 100
AFRICA
140 80
105 60
70 40
35 20
0 0
2005 2011 2012 2005 2011 2012
179 179

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 1 201 92 0 133 19 154
Cream 2 40 0 100 1 100
Butter and butteroil (A) 16 94 36 45 1 18
Cheese 569 92 25 40 75 51
(A) Production of butter only.
CONSUMPTION
Butter 59 100
Cheese 759
90
80.7
Milk 24.5 70
Butter 0.7 60
Cheese 9.4
50
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
Foot-and-mouth disease returned to attack cattle in Egypt in January 2012, after a previous outbreak in 2006.
The average decline in the overall milk production is estimated at approximately 12%. Lack of veterinary care
among small farms as well as lack of government support in that period has devastated around 15% of the
number of heads in small farms. Large producers have had the ability and technical expertise to substitute raw
milk with powder milk.
As far as price trends at both farm, wholesale and retail levels, the average unit price has increased by around
6% in 2012.
Consumption trends: the political unrest in 2011 has supported the growth of packaged food culture. The
shopping, stocking and consumption convenience is one of the key drivers of the growth of pre-packed dairy
products, as opposed to loose products such as dairy, yoghurt or cheese. Meanwhile, the price gap between
pre-packed and loose products started to become smaller compared to the situation before 2012. The
increasing demand for packaged dairy products and manufacturers willingness to compete with the informal
market has supported the shrinking of this price gap.
The Egyptian currency devaluation against the USD, in addition to the lack of fuel supply, is expected to
increase the unit price of the loose and pre-packed dairy products (mainly due to the increase in the overall
production cost).
Source: National Committee of the IDF, Chamber of Food Industries (www.egycfi.org.eg), Comtrade, FAO,
FAPRI, UN.
180 180
SOUTH AFRICA
DAIRY FARMING
Key figures

1 000 tonnes ZAR per 100 kg
3 000 500
2 800 400
2 600 300 F 3.7%
2 673
F 3.5% F 3.7% P 3.3%
2 400 200 P 3.2% P 3.3%
2 200 100
2 000 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
PROCESSING INDUSTRY
Main processors
Clover www.clover.co.za
Parmalat www.parmalat.co.za
Woodlands www.woodlands.co.za
Nestl www.nestle.co.za
Dairybelle www.dairybelle.co.za
Production
75 25
60 20
45 15
30 10
15 5
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
TRADE
Export Import
AFRICA
15 15
12 12
9 9
6 6
3 3
0 0
2005 2011 2012 2005 2011 2012
181 181

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk 1 262 81 14 210 28 151
Cream - - 1 70 2 82
Cheese 68 145 13 194 2 106
CONSUMPTION
Butter 14 56
Cheese 79
54
52.4
Milk 23.8 50
Butter 0.3 48
Cheese 1.5
46
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
The trend towards fewer and larger milk producers has continued. There was also some consolidation within
the secondary industry. Producer prices increased in the first half of 2012 and decreased in the second half.
Higher feed and administered prices had a negative effect on farm profitability while stagnant ex-factory prices
and higher energy costs limited the profitability of the secondary sector. Retail prices decreased during the
second half of 2012.
Dairy consumption continues to grow, albeit at slower rates than during 2011. Increase in consumption was
offset by a decrease in retail prices. There was a shift from pasteurised milk to long-life milk and from bulk
cheese to pre-packed cheese.
Imports and exports increased during 2012.
On a policy level South Africa is currently negotiating a new treaty with the EU.
Source: National Committee of the IDF, Milk Producers' Organisation (www.mpo.co.za), FAO, Comtrade,
UN.
182 182
ZIMBABWE
DAIRY FARMING
Key figures

1 000 tonnes USD per 100 kg
150 75
120 60
90 45
49 F 3.2%
60 30
30 15
0 0
2005 2006 2007 2008 2009 2010 2011 2012
2010 2011 2012
(A) When not specified, real fat and protein contents.
PROCESSING INDUSTRY
Main processors
Dairibord www.dairibord.com
Kefalos Cheese www.cheeseman1.com
Dendairy Dairies www.dendairy.com
Nestl www.nestle.com
Kershelmar -
Production
10 5
8 4
6 3
4 2
2 1
0 0
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
Cheese Butter/-oil
TRADE
Export Import
1.0 5
AFRICA
0.8 4
0.6 3
0.4 2
0.2 1
0.0 0
2005 2011 2012 2005 2011 2012
183 183

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk - - 6 48 0 -
Fermented products - - 1 89 0 -
Cream - - 0 0 0 -
Butter and butteroil (B) 2 100 0 88 0 -
Cheese 3 105 0 0 0 -
Whole milk powder 0 0 2 96 0 -
(B) Production: year 2011.
CONSUMPTION
Butter - 15
Cheese -
14
13.0
Milk - 12
Butter - 11
Cheese -
10
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
Zimbabwes move to dollarization (use of the US Dollar) in 2009 has helped to stabilize the milk price to
between 45 and 74 cents/litre an average of 60 cents. Processors offer a quality premium scheme which
allows farmers to obtain up to 70 cents/litre. This is one of the best prices for milk in the region which has
forced Zimbabwean dairy farmers to take another look at their costs of production in order to remain
competitive. The high cost of compliance remains a major deterrent to competitiveness in Zimbabwe, that is,
the various taxes, duties, surtaxes and council levies which weigh heavily on farmers and ultimately get
passed on to the consumer. Feed costs are high and make up to 80% of variable costs; the GMO ban has
kept feed costs very high.
The monthly consumption of milk equivalent is 10 million litres and of this, 4.5 million litres are produced
locally, leaving a remainder of 5 million which is imported. With this fierce competition from across our
borders, dairy farmers are facing a harsh reality.
However with a market deficit such as this, the opportunity for developing the industry is vast and as such the
small scale sector in Zimbabwe has seen the biggest growth in the industry, reaching production levels of
approximately 2 million litres in 2012 from this sector.
Zimbabwe has approximately 210 large to medium-scale farmers and around 1 500 small-scale farmers.
The change in the structure of the dairy industry in Zimbabwe has meant that there is now a growing
emergent sector of medium-scale farmers, that is, large-scale farmers that have shrunk to between 30 to 50
cows in milk or small-scale farmers that have grown to this herd size.
Source: National Committee of the IDF, The Commercial Farmers' Union of Zimbabwe (www.cfuzim.org),
FAO, Comtrade, UN.
184 184
AUSTRALIA (A)
(A) Dairy years: July to June. DAIRY FARMING
Key figures

1 000 tonnes AUD per 100 kg
12 000 50
11 000 40
F 4.1%
F 4.0% F 4.0%
10 000 P 3.3%
30 P 3.4% P 3.4%
9 000 20
9 476
8 000 10
7 000 0
2006/07 2008/09 2010/11 2012/13
2010/11 2011/12 2012/13
PROCESSING INDUSTRY
Main processors
Murray Goulburn www.mgc.com.au
Fonterra Australia www.fonterra.com.au
Lion www.lionco.com
Warrnambool Cheese & Butter www.wcbf.com.au
Bega Cheese www.begacheese.com.au
Production
500 500
400 400
300 300
200 200
100 100
0 0
2006/07 2008/09 2010/11 2012/13 2006/07 2008/09 2010/11 2012/13
TRADE
Export Import
250 100
200 80
150 60
100 40
50 20
OCEANIA
0 0
2005/06 2011/12 2012/13 2005/06 2011/12 2012/13
185 185

Volume (x 1 000 tonnes) 2012/13 (11/12=100) 2012/13 (11/12=100) 2012/13 (11/12=100)
Liquid milk 2 514 102 6 107 95 108
Cream - - 2 100 0 -
Cheese 339 99 78 102 152 94
Skim milk powder 251 109 5 108 147 104
CONSUMPTION
Butter 92 24
Cheese 271 23.0
23
Milk 109.3 21
Butter 4.0 20
Cheese 11.8
19
2005 2006 2007 2008 2009 2010 2011 2012
KEY DEVELOPMENTS
The 2012/13 season has proved a difficult one for many dairy farmers, as falling farm gate prices, higher input
costs and unfavorable seasonal conditions combined to challenge the profitability of farm businesses. Short-
term oscillations in returns and profitability have strained finances and are challenging confidence. Variable
seasonal conditions combined with reduced farm gate margins provided little incentive to expand production.
The two major supermarkets have announced new milk sourcing strategies intended to increase farm gate
price transparency and improve public relations associated with milk price discounting.
Overall domestic per capita consumption for key dairy categories increased by 5 litres to 302 litres in milk
equivalents in 2011/12. Slight increases in milk and yoghurt consumption were noted.
The new Australian Dietary Guidelines were released in February 2013. The Guidelines, based on whole
foods, provide up-to-date advice about the amount and kinds of foods we need to eat for health and
wellbeing. The guideline on dairy foods advises milk, yoghurt, cheese and or alternatives, mostly reduced fat
which falls under the guideline to enjoy a wide variety of nutritious foods from the five food groups every day.
Diversity in conditions facing different sectors of the economy continues to weigh on business investment
confidence, making economic activity patchy. The Reserve Bank of Australias latest outlook for the Australian
economy sees GDP growing at 2.5% in 2013 and 3% over 2014. Employment growth and business
investment are expected to remain weak in the short-term, with an expected decline in mining activity.
Underlying inflationary pressures are expected to be weak in the short-term, with the RBA not expected to
increase the cash rate through to the end of 2014.
Source: National Committee of the IDF, Dairy Australia (www.dairyaustralia.com.au), PRB.
186 186
NEW ZEALAND
DAIRY FARMING
Key figures
Cow milk deliveries (A) Cow milk prices (F = fat%, P = protein%)

1 000 tonnes NZD per 100 kg
22 000 100
20 517
20 000 80
18 000 60 F 4.7% F 4.7%

P 3.8% P 3.8%
F 4.8%
16 000 40 P 3.8%
14 000 20
12 000 0
2005 2006 2007 2008 2009 2010 2011 2012 2010 2011 2012
(A) Years 2005 and 2006 refer to the dairy seasons 2005/06 and 2006/07.
PROCESSING INDUSTRY
Main processors
Fonterra www.fonterra.com
Open Country Dairy www.opencountry.co.nz
Westland Milk Products www.westland.co.nz
Synlait Milk www.synlait.com
Tatua www.tatua.com
Production
1 400 600
1 200 500
1 000 400
800 300
600 200
400 100
2005 2006 2007 2008 2009 2010 2011 2012 2005 2006 2007 2008 2009 2010 2011 2012
WMP Cheese Butter/-oil SMP
TRADE
Export Import
1 500 10
1 200 8
900 6
600 4
OCEANIA
300 2
0 0
2005 2011 2012 2005 2011 2012
187 187

Volume (x 1 000 tonnes) 2012 (2011=100) 2012 (2011=100) 2012 (2011=100)
Liquid milk (B) 352 103 6 95 167 107
Cheese (C) 310 115 3 108 306 121
Whole milk powder 1 250 110 0 - 1 257 113
Skim milk powder 386 105 0 108 390 108
(B) Including fermented milk products, cream and concentrated milk (fluid). (C) Including processed cheese.
CONSUMPTION
Milk (D) 300 mln inhabitants
Butter 21 7
Cheese 30
6
4.5
Milk (D) 67.3 4

Butter 4.7 3
Cheese 6.7
2
2005 2006 2007 2008 2009 2010 2011 2012
(D) Including milk drinks and fermented products.
KEY DEVELOPMENTS
Pasture growing conditions were superb throughout much of 2012 in New Zealand, leading to record milk
production across the country (+8.5%). At the end of the dairying season (May 2012) all regions achieved
record per hectare production. New Zealands milking dairy cow population increased by approximately 2%
from 2011.
A lower milk price in 2012 was driven by both lower dairy commodity prices and partly by a higher NZ dollar
exchange rate. As the year progressed, milk prices to farmers decreased by approximately 1 NZD per
kilogram milk solids. Export volumes continued to grow due to production levels, an increase of 13% from
2011.
Increased milk production largely offset falling milk prices for farmers so farmer cash flows were strong and
relatively similar to 2011. Lower interest rates helped reduce interest payments; however thanks to high milk
prices the previous year, many farmers had more tax to pay in 2012.
Production in 2013 is not forecast to grow as strongly as 2012; a drought across the North Island in early 2013
has dampened production considerably and increased costs for farmers across two dairying seasons.
Commodity prices have strengthened in 2013 and the countrys largest co-operative dairy company
announced a high forecast milk price for the coming season. This announcement has buoyed farmers,
especially those who have struggled with reduced production and increased farm costs owing to the drought.
The dairy sector in New Zealand drives economic growth, contributing to export earnings and employment.
Dairy export earnings form up to 28% of merchandise trade and approximately 45 000 people work in the
sector, some are business owners and others are employed on-farm or in dairy processing. Indirectly, dairying
supports many more jobs in industries that supply agriculture. Volume and price growth for dairy farming has
delivered benefits to a wide range of sectors outside of the dairy industry, and has generated living standard
improvements across New Zealands regional economies.
Source: National Committee of the IDF, DairyNZ (www.dairynz.co.nz), DCANZ, LIC, national statistics, UN.
188 188
Annex 2: Local Dairy Leaders (A) in Different World Areas

(2012 turnover in billion USD)
Oceania
Australia
Lion Nathan National Foods* 2.6
Murray Goulburn** 2.4
Parmalat (Lactalis) 1.3
Bega Cheese** 1.0
Warrnambool** 0.5 New Zealand
* Fruit juices included; Year 2012 ending in September
** Year 2012 ending in June Fonterra 15.8
Fonterra Australia not ranked Open Country 0.5
Westland 0.4
Year 2012 ending in July except for Open
Country (July 2011)
Western Asia
Turkey
Sta 0.6
Pinar Sut 0.4
AK Gida not ranked
Saudi Arabia
Israel Al Marai* 2.6
Tnuva 1.8 Sadafco** 0.4
Strauss* 0.5 * Food turnover (poultry & bakery included)
* Salad and juices included ** Year 2012 ending in March
Central and Southern Asia
Pakistan
India
Nestle Pakistan 0.8
GCMMF Amul* 2.5
Engro 0.4
Food turnover Mother Dairy** 1.1
Haleeb Foods not ranked Nestl India*** 0.7
* Year 2013 ending in March
** Year 2012 ending in March
*** Dairy only
(A)
Ranking expressed in terms of turnover.
189 189
South Eastern Asia

Vietnam
Vinamilk 1.3
Philippines
Alaska (FrieslandCampina) 0.3
Year 2011
Nestl not ranked
Malaysia
Dutch Lady Milk 0.3
Singapore
Fraser & Neave 0.8
Dairy only
Year ending in September
Eastern Asia
China
Yili 6.7
Mengniu 5.7
Bright Dairy 2.2
Japan
Meiji Dairies 7.5
Morinaga* 7.2
Megmilk Snow Brand 2.3
* Dairy only
Year 2013 ending in March
South Korea
Seoul Dairy* 1.6
Namyang 1.2
Taiwan Maeil Dairy 0.9
Uni-President 0.4 * Year 2011
Dairy only
Africa
Morocco Egypt
Centrale laitire (Danone) 0.8 Juhayna 0.5
Nigeria
Wamco (FrieslandCampina) 0.7
South Africa
Clover* 0.9
* Year 2012 ending in June
190 190
North & Central America
Canada
United States Saputo* 7.2
DFA 12.1 Agropur 3.7
Dean Foods 11.4 Parmalat (Lactalis) 2.2
Land OLakes 4.2 * Year ending in March 2013
Kraft Foods* 3.8
Schreiber** 3.5 Mexico
* Dairy sales only
Lala 6.0
** Estimates
Estimates
Mondelez & General Mills not ranked
Costa Rica
Dos Pinos 0.8
South America
Venezuela
Brazil
Brasil Foods* 1.4
Colombia Lcteos Brasil 1.1
Colanta 0.9 Itamb 0.9
* Dairy sales only
Alpina 0.9
DPA (Fonterra-Nestl) not ranked
Uruguay
Peru Conaprole 0.8
Year ending in July
Gloria 1.1
Chile Argentina
Soprole 0.7 Mastellone Hermanos 1.7
Sancor 1.2
191 191
Northern Europe
Sweden Norway
Norrmejerier 0.3 Tine 3.4
Sknemejerier (Lactalis) & Milk
(Arla Foods) not ranked
Finland
Iceland Valio 2.6
Mjlkkursamsalan 0.1- 0.2
Estimate Estonia
Tere* 0.1
Valio Eesti 0.1
Ireland * Year 2010
Glanbia 3.9
Dairygold 0.9 Latvia
Lakeland Dairies 0.6 RPK 0.1
Year 2010
Kerry not ranked (total turnover: 7.4)
United Kingdom Lithuania

Arla Foods UK 2.7 Pieno vaigds 0.3
Dairy Crest* 2.2 Rokikio sris 0.3
* Year ending in March 2013
Denmark
Arla Foods 10.9
Total turnover
Western Europe
Netherlands
FrieslandCampina* 13.2
Vreugdenhil 0.7
DOC Kaas 0.6
* Total turnover
Germany
Mller* 6.0
DMK 5.7
Belgium FrieslandCampina 1.6
Milcobel 1.1 Hochwald 1.6
Hochland 1.5
World sales, except for FrieslandCampina
(German turnover)
Luxemburg * Food and logistic activities included
Luxlait 0.1 Arla not ranked
Year 2010
Austria
France Berglandmilch 1.1
Lactalis 20.2 Nm 0.4
Danone* 15.0
Sodiaal 5.6 Switzerland
Bongrain 5.2 Nestl* 19.8
Fromageries Bel 3.4 Emmi 3.2
World sales Elsa 0.7
* Infant formula excluded
Cremo 0.5
* Infant formula excluded; world sales
192 192
Eastern Europe
Russia
Danone-Unimilk 2.5
Wimm Bill Dann (Pepsico)* 2.3
* Fruit juices included
Poland
Mlekpol* 1.0
Mlekovita 0.9
* Year 2011
Czech Republic
Madeta 0.3
Year 2011
Slovakia
Rajo 0.2
Estimate Ukraine
Milkiland 0.4
Russian subsidiary OMK activity included
Romania
Hungary Danone 0.2
Sole Mizo 0.2 Year 2011
Southern Europe
Slovenia Croatia
Ljubljanske Mlekarne 0.2 Dukat 0.4
Year 2011
Serbia
Portugal Imlek 0.4
Lactogal 0.9
Year 2010
Greece
Vivartia (Marfin Group)* 0.8
Fage 0.6
FrieslandCampina 0.4
* Food & dairy turnover
Spain
Lactalis Iberia* 1.7 Italy
Danone S.A.** 1.4 Lactalis Italia (except Parmalat)* 1.9
Leche Pascual 0.9 Parmalat Italia (Lactalis) 1.2
Capsa 0.9 Granarolo 1.2
* Year 2011 * Year 2010
** Year 2011; dairy only
193 193
Annex 3: Tables
General remarks
The following tables are based on information sent by IDF National Committees and by other
national organizations.
Other sources used: CNIEL, Comtrade, European Dairy Association, European Commission,
Eurostat, FAO, FAPRI, PZ, PRB, UN, USDA, AMI, ZMB, IFCN, FED, DNB, National Statistics.
2012 data are preliminary.
The figures in this annex can differ from the figures in chapter 5 because different sources and
moments of data collection have been used.
The '-' sign is used when figures are not available, confidential or senseless (as a numeric result
from calculations).
The value '0' (zero) is used when volume is < 500 tonnes or nil.
Milk prices table: for fat and protein contents, see country reports.
Consumption data may not always take into account informal consumption and therefore may differ
from actual dairy product consumption in a country.
194 194
Contents
Dairy farming
Table 1. World milk production by species of milk animal page 196

Table 2. World cow's milk production page 196
Table 3. World buffalo milk production page 196
Table 4. Number of dairy farms page 197
Table 5. Number of dairy cows page 199
Table 6. Production of cow's milk page 201
Table 7. Deliveries of cow's milk to dairies page 204
Processing
Table 8. Production of liquid milk page 206

Table 9. Production of milk drinks and fermented products page 208
Table 10. Production of cream for consumption page 210
Table 11. Production of butter and butteroil page 211
Table 12. Production of cheese page 213
CONTENTS ANNEX 3
CONTENTS ANNEX 3
Table 13. Production of whole and semi-skimmed milk powder page 215
Table 14. Production of skim milk powder page 217
Table 15. Production of condensed milk page 219
Table 16. Production of whey powder page 220
Trade
Table 17. World and selected countries exports in butter and butteroil page 221
Table 18. World and selected countries exports trade in cheese page 221
Table 19. World and selected countries exports in whole and semi-skimmed milk powder page 222
Table 20. World and selected countries exports in skim milk powder page 222
Table 21. World and selected countries imports in butter and butteroil page 223
Table 22. World and selected countries imports in cheese page 223
Table 23. World and selected countries imports in whole and semi-skimmed milk powder page 224
Table 24. World and selected countries imports in skim milk powder page 224
Consumption
Table 25. Liquid milk consumption page 225

Table 26. Butter consumption page 227
Table 27. Cheese consumption page 229
Prices
Table 28. Average producer milk prices page 231

Table 29. Butter prices in selected countries page 233
Table 30. Cheese prices in selected countries page 234
Table 31. Whole milk powder prices in selected countries page 235
Table 32. Skim milk powder prices in selected countries page 236
195 195
Table 1. World milk production by species of milk animal

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Type of milk '11-'12 '00-'12
Cow milk 489 284 549 370 608 001 624 165 637 288 + 2.1% + 2.2%
Buffalo milk 67 106 79 451 93 282 97 380 100 747 + 3.5% + 3.4%
Goat milk 13 208 15 316 17 803 18 162 18 271 + 0.6% + 2.7%
Sheep milk 8 171 8 862 9 977 9 882 10 198 + 3.2% + 1.9%
Other 2 180 2 378 2 866 3 002 3 020 + 0.6% + 2.8%
Total world milk production 579 948 655 377 731 927 752 592 769 525 + 2.2% + 2.4%
Table 2. World cow's milk production

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Type of milk '11-'12 '00-'12
Asia 95 030 131 350 165 346 169 588 177 047 + 4.4% + 5.3%
EU 27 149 464 149 657 149 026 151 910 151 956 + 0.0% + 0.1%
North and Central America (A) 97 963 103 005 112 115 113 796 116 257 + 2.2% + 1.4%
South America 44 282 53 333 63 756 67 379 67 846 + 0.7% + 3.6%
Other Europe 59 012 61 168 60 175 59 733 60 551 + 1.4% + 0.2%
Africa 19 272 25 235 30 970 32 957 33 510 + 1.7% + 4.7%
Oceania 24 260 25 621 26 612 28 802 30 120 + 4.6% + 1.8%
World 489 284 549 370 608 001 624 165 637 288 + 2.1% + 2.2%
(A) Including Caribbean.
Table 3. World buffalo milk production

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Type of milk '11-'12 '00-'12
India (A) 43 428 52 070 62 350 65 696 68 800 + 4.7% + 3.9%

Pakistan (B) 17 454 20 488 22 955 23 652 24 370 + 3.0% + 2.8%
China 2 650 2 800 3 100 3 100 3 100 0.0% + 1.3%
Egypt 2 030 2 300 2 725 2 723 2 272 - 16.6% + 0.9%
Nepal 760 895 1 067 1 109 1 109 0.0% + 3.2%
Italy 107 206 271 273 263 - 3.8% + 7.8%
Iran 216 232 240 240 240 0.0% + 0.9%
Turkey 67 38 34 40 47 + 16.4% - 3.0%
Brazil 46 46 46 46 46 0.0% 0.0%
Other 347 376 494 500 501 + 0.3% + 3.1%
World 67 106 79 451 93 282 97 380 100 747 + 3.5% + 3.4%
(A) Dairy years ending March of the following year; year 2012/13 estimated.
(B) Dairy years ending June of the following year; milk production for human consumption.
196 196
Table 4. Number of dairy farms (A)

000 Annual
2010 2011 2012 growth CAGR
Country '10-'12 '10-'12
Asia
India 77 889.0 79 000.0 79 000.0 0.0% + 0.7%
Pakistan 7 399.0 7 200.0 7 200.0 0.0% - 1.4%
Turkey - 1 739.4 1 382.3 - 20.5%
Kazakhstan 880.0 880.0 880.0 0.0% 0.0%
China (B) 213.6 200.0 200.0 0.0% - 3.2%
Japan 21.9 21.0 20.1 - 4.3% - 4.2%
Iran 14.5 14.5 13.0 - 10.0% - 5.1%
Korea, Republic of 6.3 6.1 6.0 - 1.0% - 2.7%
Mongolia (C) 0.6 0.9 1.0 + 8.4% + 22.7%
Israel 1.0 1.0 0.9 - 1.4% - 0.6%
Other Europe
Russia 3 130.0 3 000.0 3 000.0 0.0% - 2.1%
Belarus 66.0 60.0 60.0 0.0% - 4.7%
Switzerland 26.1 25.2 24.4 - 3.4% - 3.4%
Croatia 19.9 17.4 14.9 - 14.3% - 13.6%
Ukraine - 11.2 11.2 0.0%
Norway (D) 11.5 10.9 10.3 - 5.6% - 5.3%
Iceland 0.7 0.7 0.7 - 1.9% - 1.1%
South America
Brazil 1 200.0 1 126.0 1 050.0 - 6.7% - 6.5%
Colombia - 366.0 366.0 0.0%
Argentina 11.9 11.6 11.6 0.0% - 1.2%
Chile - 6.5 6.5 0.0%
Uruguay 4.5 4.4 4.3 - 3.0% - 2.5%
EU 27 (E) 838.7 712.3 668.6 - 6.1% - 10.7%

Poland 170.1 159.4 149.6 - 6.2% - 6.2%
Romania 139.1 112.2 100.2 - 10.7% - 15.1%
Germany 90.4 87.5 82.2 - 6.0% - 4.6%
France 82.0 78.2 74.8 - 4.3% - 4.5%
Lithuania 45.0 41.3 39.5 - 4.3% - 6.2%
Austria 39.8 37.9 37.5 - 1.0% - 3.0%
Italy 37.3 35.6 34.1 - 4.1% - 4.4%
Spain 22.6 21.4 20.2 - 5.6% - 5.4%
Ireland 19.0 18.9 19.1 + 1.1% + 0.2%
Netherlands 19.6 19.0 18.5 - 2.7% - 2.7%
United Kingdom 15.8 15.2 14.6 - 3.5% - 3.7%
Bulgaria 83.4 16.0 12.4 - 22.5% - 61.5%
Finland 12.1 11.4 10.7 - 6.6% - 6.1%
Latvia 11.7 10.8 10.5 - 3.1% - 5.2%
Belgium 10.5 9.9 9.5 - 3.9% - 5.0%
Portugal 9.1 8.0 7.4 - 7.2% - 9.7%
Sweden 6.4 6.1 5.7 - 6.0% - 5.5%
Denmark 4.3 4.1 4.0 - 4.4% - 4.2%
Hungary 3.2 3.1 2.6 - 17.0% - 10.2%
Czech Republic 2.3 2.2 2.1 - 5.0% - 6.0%
Estonia 0.9 0.8 0.8 - 5.9% - 6.4%
197 197
Table 4. Number of dairy farms (continued) (A)

000 Annual
2010 2011 2012 growth CAGR
Country '10-'12 '10-'12
EU 27 continued (E)
Luxembourg 0.8 0.8 0.8 - 2.8% - 3.0%
Slovakia 0.6 0.6 0.6 - 2.8% - 4.5%
Cyprus 0.2 0.2 0.2 - 2.7% - 1.4%
Other 12.3 11.6 10.9 - 5.6% - 5.7%
North and Central America

Mexico - 105.4 105.4 + 0.0%
United States of America (F) 53.1 51.3 49.3 - 3.8% - 3.6%
Canada 13.0 12.7 12.5 - 1.7% - 1.7%
Oceania
New Zealand 11.7 11.8 11.8 + 0.4% + 0.4%
Australia 6.9 6.8 6.5 - 4.0% - 2.8%
Africa
Egypt 600.9 596.5 536.9 - 10.0% - 5.5%
South Africa 2.7 2.6 2.2 - 16.3% - 10.1%
Zimbabwe 0.2 0.2 0.2 + 12.9% + 12.8%
(A) Estimate of number of dairy farms when data are missing. (B) Farms with more than 10 cows.
(C) Dairy farms established in centrally located areas and areas close to big cities and provincial centres.
(D) Points of deliveries (joint farmers operations).
(E) Number of delivery quota holders (situation on 31 March of each year).
(F) Farm operations with a license to market milk.
198 198
Table 5. Number of dairy cows

000 head Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
Asia 73 447 86 191 101 294 104 204 106 413 + 2.1% + 3.1%
India 32 883 36 586 42 755 43 717 45 000 + 2.9% + 2.6%
China 5 238 12 161 14 201 14 402 14 400 - 0.0% + 8.8%
Pakistan 6 815 7 504 10 112 10 493 10 550 + 0.5% + 3.7%
Turkey 5 280 3 998 4 384 4 761 5 431 + 14.1% + 0.2%
Uzbekistan 2 305 2 821 3 536 3 764 3 878 + 3.0% + 4.4%
Afghanistan 2 000 2 600 3 500 3 500 3 500 0.0% + 4.8%
Iran 2 700 2 663 2 899 2 925 2 975 + 1.7% + 0.8%
Myanmar 1 272 1 406 2 600 2 600 2 650 + 1.9% + 6.3%
Kazakhstan 1 735 2 206 2 371 2 747 2 538 - 7.6% + 3.2%
Azerbaijan 787 969 1 277 1 288 1 306 + 1.4% + 4.3%
Turkmenistan 620 1 010 1 000 1 000 1 000 0.0% + 4.1%
Japan 1 150 1 055 964 933 943 + 1.0% - 1.6%
Mongolia 927 737 509 623 706 + 13.3% - 2.2%
Kyrgyzstan 505 538 664 667 684 + 2.7% + 2.6%
Syria 459 561 518 611 615 + 0.6% + 2.5%
Indonesia 354 361 495 597 597 0.0% + 4.4%
Korea, Republic of 255 271 241 229 249 + 8.7% - 0.2%
Saudi Arabia 84 106 160 160 160 0.0% + 5.5%
Israel 115 115 118 124 126 + 1.6% + 0.8%
Other 7 963 8 522 8 990 9 064 9 104 + 0.4% + 1.1%
Africa 41 044 53 016 62 281 64 492 64 833 + 0.5% + 3.9%

Sudan (A) 9 300 14 972 14 679 14 679 14 679 0.0% + 3.9%
Ethiopia 4 340 3 116 9 628 10 677 10 800 + 1.2% + 7.9%
Tanzania 3 400 5 500 6 900 6 900 6 950 + 0.7% + 6.1%
Kenya 4 690 5 857 5 002 5 545 5 545 0.0% + 1.4%
Uganda 1 460 2 950 3 400 3 400 3 400 0.0% + 7.3%
Egypt 1 372 1 700 1 737 1 748 1 608 - 8.0% + 1.3%
Morocco 1 308 1 400 1 485 1 588 1 555 - 2.1% + 1.5%
Algeria 900 950 915 941 966 + 2.7% + 0.6%
Tunisia 550 560 620 620 625 + 0.8% + 1.1%
South Africa 545 540 540 540 540 0.0% - 0.1%
Zimbabwe 70 48 27 15 26 + 76.9% - 7.9%
Other 13 109 15 423 17 349 17 840 18 139 + 1.7% + 2.7%
South America 28 753 33 662 33 201 33 958 33 842 - 0.3% + 1.4%

Brazil 17 885 20 820 22 999 23 513 23 730 + 0.9% + 2.4%
Colombia 3 700 5 646 2 853 2 859 2 693 - 5.8% - 2.6%
Argentina 2 004 1 885 1 749 1 884 1 748 - 7.2% - 1.1%
Venezuela 1 372 1 307 1 659 1 680 1 700 + 1.2% + 1.8%
Ecuador 1 117 934 1 323 1 349 1 289 - 4.4% + 1.2%
Chile 1 450 1 585 1 016 1 016 1 016 0.0% - 2.9%
Peru 513 690 788 815 842 + 3.3% + 4.2%
Uruguay 400 398 428 450 430 - 4.4% + 0.6%
Other 312 397 387 392 394 + 0.5% + 2.0%
EU 27 27 405 24 910 22 890 22 717 22 662 - 0.2% - 1.6%

Germany 4 564 4 164 4 182 4 190 4 190 0.0% - 0.7%
France 4 153 3 958 3 712 3 660 3 640 - 0.6% - 1.1%
199 199
Table 5. Number of dairy cows (continued)

000 head Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
EU 27 (continued)
Poland 3 047 2 795 2 529 2 446 2 346 - 4.1% - 2.2%
Italy 2 172 1 842 1 746 1 755 1 857 + 5.8% - 1.3%
United Kingdom 2 339 2 007 1 847 1 800 1 802 + 0.1% - 2.2%
Netherlands 1 504 1 433 1 479 1 470 1 484 + 1.0% - 0.1%
Romania 1 692 1 625 1 179 1 170 1 163 - 0.6% - 3.1%
Ireland 1 153 1 122 1 007 1 036 1 060 + 2.4% - 0.7%
Spain 1 141 1 113 845 837 836 - 0.1% - 2.6%
Denmark 644 558 573 579 579 0.0% - 0.9%
Austria 621 538 534 531 527 - 0.8% - 1.4%
Belgium 594 523 500 488 489 + 0.2% - 1.6%
Czech Republic 547 439 378 374 369 - 1.3% - 3.2%
Sweden 426 391 348 347 348 + 0.4% - 1.7%
Lithuania 494 438 345 350 311 - 11.0% - 3.8%
Bulgaria 421 348 314 313 295 - 6.0% - 2.9%
Finland 361 316 287 284 283 - 0.4% - 2.0%
Hungary 380 285 240 251 253 + 0.8% - 3.3%
Portugal 355 324 243 242 237 - 2.1% - 3.3%
Latvia 205 185 164 164 165 + 0.3% - 1.8%
Slovakia 246 199 161 156 152 - 2.4% - 3.9%
Estonia 131 113 96 96 96 + 0.5% - 2.6%
Luxembourg 44 41 41 40 40 - 1.5% - 0.8%
Cyprus 24 25 23 24 24 + 0.4% + 0.2%
Other 148 128 116 115 117 + 1.6% - 1.9%
North and Central America (B) 15 969 16 253 17 042 17 160 17 237 + 0.5% + 0.6%
United States of America 9 206 9 043 9 119 9 194 9 233 + 0.4% + 0.0%
Mexico 2 075 2 197 2 344 2 374 2 382 + 0.3% + 1.2%
Canada 1 103 1 041 966 966 960 - 0.6% - 1.2%
Costa Rica 525 568 702 702 705 + 0.4% + 2.5%
Other 3 060 3 404 3 910 3 924 3 957 + 0.8% + 2.2%
Other Europe 23 389 17 826 15 669 15 604 15 520 - 0.5% - 3.4%

Russia 13 100 9 647 8 844 8 948 8 895 - 0.6% - 3.2%
Ukraine 5 195 3 781 2 772 2 663 2 632 - 1.2% - 5.5%
Belarus 1 845 1 565 1 478 1 477 1 521 + 3.0% - 1.6%
Switzerland 669 619 595 596 594 - 0.3% - 1.0%
Serbia 775 551 523 501 494 - 1.3% - 3.7%
Norway 316 275 245 241 235 - 2.5% - 2.4%
Croatia 287 239 198 184 181 - 1.6% - 3.8%
Iceland 27 24 26 26 25 - 3.5% - 0.8%
Other 1 175 1 125 988 968 943 - 2.5% - 1.8%
Oceania 5 706 6 160 6 042 6 232 6 312 + 1.3% + 0.8%

New Zealand 3 485 4 100 4 400 4 550 4 650 + 2.2% + 2.4%
Australia 2 171 2 010 1 590 1 630 1 610 - 1.2% - 2.5%
Other 50 50 52 52 52 + 0.1% + 0.3%
World 215 712 238 018 258 420 264 367 266 820 + 0.9% + 1.8%
(A) Including South Sudan (this country is independent since 9th July of 2011). (B) Including Caribbean.
200 200
Table 6. Production of cow's milk

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
Asia 95 030 131 350 165 346 169 588 177 047 + 4.4% + 5.3%
India (A) 32 967 39 759 54 903 57 387 60 100 + 4.7% + 5.1%
China 8 420 27 534 35 756 36 560 37 440 + 2.4% + 13.2%
Turkey 8 732 10 026 12 419 13 802 15 978 + 15.8% + 5.2%
Pakistan (B) 8 192 10 726 12 906 13 393 13 897 + 3.8% + 4.5%
Japan 8 497 8 285 7 721 7 474 7 630 + 2.1% - 0.9%
Iran 5 200 6 841 8 900 7 240 7 312 + 1.0% + 2.9%
Uzbekistan 3 560 4 447 6 120 6 712 7 196 + 7.2% + 6.0%
Kazakhstan 3 686 4 693 5 348 5 186 4 816 - 7.1% + 2.3%
Turkmenistan 989 1 869 2 150 2 150 2 200 + 2.3% + 6.9%
Korea, Republic of 2 253 2 230 2 073 1 889 2 111 + 11.8% - 0.5%
Syria 1 156 1 506 1 453 1 702 1 755 + 3.1% + 3.5%
Saudi Arabia 710 1 008 1 670 1 700 1 725 + 1.5% + 7.7%
Azerbaijan 1 014 1 226 1 507 1 567 1 683 + 7.4% + 4.3%
Afghanistan 1 320 1 458 1 401 1 403 1 508 + 7.5% + 1.1%
Israel 1 173 1 196 1 290 1 378 1 385 + 0.5% + 1.4%
Kyrgyzstan 1 079 1 151 1 322 1 322 1 350 + 2.2% + 1.9%
Myanmar 498 808 1 300 1 300 1 300 0.0% + 8.3%
Indonesia 498 536 910 975 1 018 + 4.4% + 6.1%
Mongolia 376 260 243 299 339 + 13.3% - 0.9%
Other 4 710 5 791 5 956 6 150 6 305 + 2.5% + 2.5%
EU 27 149 464 149 657 149 026 151 910 151 956 + 0.0% + 0.1%
Germany 28 331 28 453 29 630 30 336 30 506 + 0.6% + 0.6%
France 24 975 24 885 24 010 25 070 24 682 - 1.5% - 0.1%
United Kingdom 14 489 14 470 13 852 14 071 13 849 - 1.6% - 0.4%
Poland 11 900 11 901 12 279 12 405 12 660 + 2.1% + 0.5%
Netherlands 11 125 10 836 11 829 11 846 11 881 + 0.3% + 0.5%
Italy 10 877 10 897 11 005 11 093 11 150 + 0.5% + 0.2%
Spain 5 900 6 553 6 357 6 488 6 502 + 0.2% + 0.8%
Ireland 5 260 5 163 5 435 5 650 5 490 - 2.8% + 0.4%
Denmark 4 717 4 586 4 965 4 935 5 064 + 2.6% + 0.6%
Romania 4 965 5 667 4 390 4 508 4 311 - 4.4% - 1.2%
Austria 3 233 3 114 3 258 3 307 3 382 + 2.3% + 0.4%
Belgium 3 425 3 082 3 358 3 407 3 369 - 1.1% - 0.1%
Sweden 3 348 3 206 2 899 2 887 2 897 + 0.3% - 1.2%
Czech Republic 2 708 2 813 2 683 2 736 2 817 + 3.0% + 0.3%
Finland 2 524 2 433 2 340 2 306 2 297 - 0.4% - 0.8%
Portugal 1 970 2 061 1 918 1 919 1 939 + 1.1% - 0.1%
Lithuania 1 725 1 862 1 737 1 786 1 820 + 1.9% + 0.4%
Hungary 2 137 1 928 1 690 1 717 1 804 + 5.0% - 1.4%
Bulgaria 1 409 1 287 1 124 1 126 1 093 - 2.9% - 2.1%
Slovakia 1 099 1 100 918 928 959 + 3.3% - 1.1%
Latvia 823 811 831 842 871 + 3.4% + 0.5%
Estonia 629 670 676 695 721 + 3.8% + 1.1%
Luxembourg 264 270 295 292 289 - 1.0% + 0.8%
Cyprus 147 147 158 161 154 - 4.3% + 0.4%
Other 1 484 1 462 1 390 1 400 1 448 + 3.4% - 0.2%
201 201
Table 6. Production of cow's milk (continued)

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
North and Central America (C) 97 963 103 005 112 115 113 796 116 257 + 2.2% + 1.4%
Mexico 9 591 10 164 10 997 11 046 11 274 + 2.1% + 1.4%
Canada 8 163 8 241 8 434 8 546 8 770 + 2.6% + 0.6%
Costa Rica 722 779 952 966 1 015 + 5.0% + 2.9%
Other 3 483 3 567 4 258 4 259 4 332 + 1.7% + 1.8%
South America 44 282 53 333 63 756 67 379 67 846 + 0.7% + 3.6%

Brazil 20 360 25 359 31 637 33 054 33 705 + 2.0% + 4.3%
Argentina 10 111 9 778 10 617 11 542 11 679 + 1.2% + 1.2%
Colombia 5 454 6 216 6 480 6 540 6 677 + 2.1% + 1.7%
Ecuador 2 007 4 570 5 709 6 375 5 675 - 11.0% + 9.0%
Chile 2 050 2 369 2 606 2 699 2 730 + 1.1% + 2.4%
Venezuela 1 415 1 348 2 300 2 380 2 400 + 0.8% + 4.5%
Uruguay 1 381 1 724 1 910 2 210 2 320 + 5.0% + 4.4%
Peru 903 1 236 1 678 1 746 1 799 + 3.1% + 5.9%
Other 602 733 819 833 862 + 3.5% + 3.0%
Other Europe 59 012 61 168 60 175 59 733 60 551 + 1.4% + 0.2%

Russia 31 938 31 440 31 847 31 646 31 917 + 0.9% - 0.0%
Ukraine 12 436 13 424 10 977 10 804 11 082 + 2.6% - 1.0%
Belarus 4 490 5 650 6 595 6 485 6 754 + 4.1% + 3.5%
Switzerland 3 872 3 933 4 080 4 117 4 101 - 0.4% + 0.5%
Norway 1 613 1 561 1 555 1 524 1 581 + 3.7% - 0.2%
Serbia 1 629 1 659 1 485 1 462 1 465 + 0.2% - 0.9%
Croatia 607 791 792 804 810 + 0.7% + 2.4%
Iceland 115 119 134 136 136 + 0.2% + 1.4%
Other 2 313 2 591 2 711 2 757 2 707 - 1.8% + 1.3%
Africa 19 272 25 235 30 970 32 957 33 510 + 1.7% + 4.7%

Sudan (D) 4 000 5 480 5 373 5 373 5 373 0.0% + 2.5%
Ethiopia 900 2 139 2 940 4 058 4 150 + 2.3% + 13.6%
Kenya 2 224 2 650 3 968 4 059 4 150 + 2.2% + 5.3%
South Africa 2 197 2 368 2 851 2 865 2 814 - 1.8% + 2.1%
Egypt 1 638 2 100 2 995 2 900 2 668 - 8.0% + 4.1%
Morocco 1 185 1 400 1 900 2 200 2 500 + 13.6% + 6.4%
Algeria 1 170 1 400 2 071 2 387 2 377 - 0.4% + 6.1%
Tanzania 710 1 386 1 650 1 739 1 853 + 6.6% + 8.3%
Uganda 511 1 033 1 190 1 190 1 190 0.0% + 7.3%
Tunisia 887 900 1 030 1 063 1 100 + 3.5% + 1.8%
Zimbabwe 182 105 47 51 56 + 10.7% - 9.4%
Other 3 668 4 274 4 956 5 073 5 279 + 4.1% + 3.1%
202 202
Table 6. Production of cow's milk (continued)

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
Oceania 24 260 25 621 26 612 28 802 30 120 + 4.6% + 1.8%

New Zealand (E) 13 333 15 163 17 169 18 966 20 572 + 8.5% + 3.7%
Australia (F) 10 862 10 392 9 373 9 765 9 476 - 3.0% - 1.1%
Other 65 66 70 71 72 + 1.0% + 0.8%
World 489 284 549 370 608 001 624 165 637 288 + 2.1% + 2.2%
(A) Dairy years ending March of the following year; year 2012/13 estimated.
(B) Dairy years ending June of the following year; milk production for human consumption. (C) Including Caribbean.
(D) Including South Sudan (this country is independent since 9th July of 2011).
(E) The years 2000 and 2005 refer to the seasons 2000/01 and 2005/06 (period June to May).
(F) Dairy years ending June of the following year.
203 203
Table 7. Deliveries of cow's milk to dairies

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
EU 27 130 988 133 840 136 469 139 539 140 345 + 0.6% + 0.6%
Germany 26 984 27 380 28 655 29 339 29 712 + 1.3% + 0.8%
France 23 303 23 383 23 555 24 677 24 226 - 1.8% + 0.3%
United Kingdom 13 932 14 038 13 582 13 805 13 591 - 1.6% - 0.2%
Netherlands 10 734 10 486 11 622 11 641 11 675 + 0.3% + 0.7%
Italy 10 084 10 216 10 604 10 822 10 876 + 0.5% + 0.6%
Poland 6 781 8 825 9 002 9 309 9 818 + 5.5% + 3.1%
Spain 5 454 5 940 5 877 5 950 6 115 + 2.8% + 1.0%
Ireland 5 162 5 063 5 329 5 538 5 380 - 2.9% + 0.3%
Denmark 4 517 4 451 4 830 4 800 4 929 + 2.7% + 0.7%
Belgium 3 034 3 025 3 311 3 357 3 319 - 1.1% + 0.8%
Austria 2 664 2 619 2 781 2 904 2 964 + 2.1% + 0.9%
Sweden 3 296 3 163 2 862 2 850 2 861 + 0.4% - 1.2%
Czech Republic 2 493 2 681 2 576 2 624 2 694 + 2.7% + 0.6%
Finland 2 442 2 362 2 293 2 260 2 254 - 0.3% - 0.7%
Portugal 1 893 1 921 1 829 1 842 1 863 + 1.1% - 0.1%
Hungary 1 830 1 518 1 322 1 308 1 398 + 6.9% - 2.2%
Lithuania 1 103 1 202 1 278 1 317 1 360 + 3.2% + 1.8%
Romania 1 300 1 109 904 897 888 - 1.1% - 3.1%
Slovakia 903 968 800 812 851 + 4.9% - 0.5%
Latvia 398 502 625 662 718 + 8.5% + 5.0%
Estonia 409 571 604 634 665 + 5.0% + 4.1%
Bulgaria 719 803 565 549 514 - 6.4% - 2.8%
Luxembourg 256 258 282 281 278 - 1.2% + 0.7%
Cyprus 133 147 147 155 153 - 1.0% + 1.2%
Other 1 165 1 210 1 235 1 206 1 242 + 3.0% + 0.5%

Mexico 7 960 8 436 9 347 9 389 9 583 + 2.1% + 1.6%
Canada 7 629 7 717 7 882 7 987 8 196 + 2.6% + 0.6%
Asia
China 5 050 19 270 26 135 27 420 27 912 + 1.8% + 15.3%
Turkey - - 6 745 7 073 7 932 + 12.2%
Japan 8 391 8 205 7 648 7 409 7 572 + 2.2% - 0.9%
Iran 2 200 3 250 5 300 5 600 5 700 + 1.8% + 8.3%
Korea, Republic of 2 253 2 229 2 073 1 889 2 111 + 11.8% - 0.5%
Kazakhstan (A) 1 100 1 400 1 600 1 550 1 450 - 6.5% + 2.3%
Israel 1 162 1 185 1 290 1 378 1 385 + 0.5% + 1.5%
Mongolia - 7 34 43 53 + 24.6%
South America
Brazil 12 471 16 773 21 605 22 449 23 009 + 2.5% + 5.2%
Argentina 9 392 9 070 9 828 10 755 10 876 + 1.1% + 1.2%
Colombia 2 163 2 627 3 434 3 532 3 539 + 0.2% + 4.2%
Chile 1 700 2 005 2 303 2 451 2 504 + 2.2% + 3.3%
Uruguay 1 077 1 392 1 599 1 899 1 994 + 5.0% + 5.3%
204 204
Table 7. Deliveries of cow's milk to dairies (continued)

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
Other Europe
Russia 14 609 16 360 17 800 17 750 18 795 + 5.9% + 2.1%
Belarus (A) 2 100 3 650 5 000 5 250 5 500 + 4.8% + 8.4%
Ukraine 3 335 5 689 4 793 4 547 4 650 + 2.3% + 2.8%
Switzerland 3 197 3 203 3 437 3 472 3 471 - 0.0% + 0.7%
Norway 1 544 1 515 1 506 1 476 1 531 + 3.7% - 0.1%
Croatia 380 605 624 626 602 - 3.8% + 3.9%
Iceland 107 113 127 129 129 + 0.2% + 1.5%
Oceania
New Zealand (B) 13 313 15 143 17 123 18 915 20 517 + 8.5% + 3.7%
Australia (C) 10 862 10 392 9 373 9 765 9 476 - 3.0% - 1.1%
Africa
South Africa 1 977 2 321 2 708 2 722 2 673 - 1.8% + 2.5%
Egypt 901 1 155 1 596 1 595 1 387 - 13.0% + 3.7%
Zimbabwe 173 100 41 44 49 + 10.9% - 10.0%
(A) Estimated. (B) The years 2000 and 2005 refer to the seasons 2000/01 and 2005/06 (period June to May).
(C) Dairy years ending June of the following year.
205 205
Table 8. Production of liquid milk

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
Asia
China 1 230 9 748 14 856 16 684 21 466 + 28.7% + 26.9%
India (A) - - 8 265 8 632 8 903 + 3.1%
Japan 4 571 4 290 3 859 3 763 3 694 - 1.8% - 1.8%
Korea, Republic of 1 672 1 691 1 641 1 624 1 685 + 3.8% + 0.1%
Turkey - - 1 091 1 165 1 250 + 7.3%
Iran - 1 325 2 400 1 200 1 100 - 8.3%
Israel 348 379 422 424 438 + 3.3% + 1.9%
Kazakhstan (B) 110 180 294 336 376 + 11.9% + 10.8%
Mongolia - 4 18 21 25 + 20.8%
EU 27 32 566 32 969 33 037 33 015 32 875 - 0.4% + 0.1%

United Kingdom 6 814 6 749 6 944 7 011 6 943 - 1.0% + 0.2%
Germany (C) 4 916 5 165 5 276 5 238 5 254 + 0.3% + 0.6%
France 3 894 3 836 3 558 3 582 3 579 - 0.1% - 0.7%
Spain 3 562 3 677 3 572 3 612 3 492 - 3.3% - 0.2%
Poland 1 803 2 363 2 810 2 812 2 824 + 0.4% + 3.8%
Italy 3 230 2 941 2 899 2 808 2 758 - 1.8% - 1.3%
Sweden 996 987 915 877 867 - 1.2% - 1.2%
Portugal 891 959 831 851 859 + 0.9% - 0.3%
Austria 513 575 727 751 769 + 2.3% + 3.4%
Finland 740 734 730 726 735 + 1.3% - 0.1%
Belgium 642 588 673 643 679 + 5.6% + 0.5%
Czech Republic 475 557 638 644 601 - 6.8% + 2.0%
Netherlands 858 841 544 527 524 - 0.7% - 4.0%
Ireland 546 536 507 509 502 - 1.4% - 0.7%
Denmark 518 457 472 472 495 + 4.9% - 0.4%
Hungary 607 567 372 367 402 + 9.7% - 3.4%
Slovakia 332 245 277 297 318 + 7.0% - 0.4%
Lithuania 75 74 87 89 91 + 1.6% + 1.6%
Estonia 59 80 94 89 87 - 3.1% + 3.2%
Cyprus 69 80 80 80 83 + 4.1% + 1.6%
Latvia 106 100 74 65 66 + 2.4% - 3.8%
Other 921 859 959 965 949 - 1.6% + 0.2%

United States of America 24 979 24 740 24 798 24 376 23 972 - 1.7% - 0.3%
Mexico 3 765 4 313 4 380 4 352 3 847 - 11.6% + 0.2%
Canada (D) 2 785 2 775 2 737 2 770 2 774 + 0.1% - 0.0%
South America
Brazil 12 690 13 400 11 278 11 429 11 715 + 2.5% - 0.7%
Colombia 1 302 1 300 2 263 2 322 2 570 + 10.7% + 5.8%
Argentina 1 598 1 623 1 796 1 777 1 861 + 4.7% + 1.3%
Chile 284 307 378 381 401 + 5.3% + 2.9%
Uruguay 234 219 242 273 263 - 3.6% + 1.0%
206 206
Table 8. Production of liquid milk (continued)

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
Other Europe
Russia - 4 188 4 868 4 860 4 860 0.0%
Belarus (E) 954 1 122 1 495 1 643 1 776 + 8.1% + 5.3%
Ukraine - 863 801 858 909 + 6.0%
Switzerland 509 488 494 487 481 - 1.1% - 0.5%
Norway (F) 485 449 442 435 433 - 0.5% - 0.9%
Croatia 296 325 334 341 304 - 10.9% + 0.2%
Iceland 39 37 34 33 32 - 2.7% - 1.5%
Oceania
Australia (G) 1 978 2 127 2 385 2 461 2 514 + 2.2% + 2.0%
New Zealand (H) 346 385 380 342 352 + 3.0% + 0.1%
Africa
South Africa - - 1 271 1 564 1 262 - 19.3%
Egypt - - 1 503 1 303 1 201 - 7.8%
(A) Refers to cooperative dairies only. This may not reflect the development for the total Indian dairy industry; dairy years ending March
of the following year.
(B) Including cream. (C) Only containers <2 litres. (D) Including chocolate milk and eggnog.
(E) Including fermented products, milk drinks and cream. (F) Including flavored milk.
(G) Dairy years ending June of the following year. (H) Including fermented milk products, cream and concentrated milk (fluid).
207 207
Table 9. Production of fermented products

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
Asia
China 270 1 702 3 600 3 924 4 076 + 3.9% + 25.4%
Iran - 623 950 2 000 2 250 + 12.5%
Turkey (A) - - 1 306 1 466 1 561 + 6.5%
Japan 716 824 862 923 1 017 + 10.2% + 3.0%
Korea, Republic of 530 482 503 522 558 + 6.9% + 0.4%
Israel (B) 151 152 180 181 185 + 2.2% + 1.7%
Mongolia - 1 6 8 8 - 2.5%
EU 27 7 967 8 820 9 417 9 430 9 290 - 1.5% + 1.3%

Germany (C) 2 613 2 956 3 005 3 047 2 915 - 4.3% + 0.9%
France 1 389 1 564 1 656 1 667 1 670 + 0.2% + 1.5%
Spain 744 775 761 788 820 + 4.0% + 0.8%
Poland 375 475 623 627 614 - 2.1% + 4.2%
Netherlands (D) 444 341 406 397 391 - 1.4% - 1.1%
United Kingdom 336 368 411 380 360 - 5.2% + 0.6%
Belgium 251 326 319 304 283 - 6.8% + 1.0%
Austria 140 252 277 273 269 - 1.2% + 5.6%
Sweden 265 270 263 263 255 - 3.1% - 0.3%
Finland 207 203 203 207 226 + 9.3% + 0.7%
Italy 190 170 210 215 210 - 2.3% + 0.8%
Czech Republic 128 129 180 173 168 - 3.1% + 2.3%
Hungary 123 152 161 148 141 - 4.4% + 1.2%
Portugal 99 102 123 134 134 0.0% + 2.5%
Denmark 87 104 105 109 110 + 1.1% + 2.0%
Lithuania 31 68 69 69 76 + 8.9% + 7.7%
Slovakia 46 52 49 54 62 + 14.3% + 2.5%
Estonia 25 33 42 42 42 + 0.2% + 4.4%
Latvia 42 41 41 39 37 - 4.4% - 1.0%
Ireland 35 34 29 31 32 + 3.1% - 0.9%
Cyprus 7 7 9 9 9 0.0% + 2.2%
Other 389 400 475 456 468 + 2.6% + 1.5%
Other Europe
Russia - 1 856 2 258 2 481 2 481 0.0%
Ukraine 158 499 479 469 486 + 3.6% + 9.8%
Switzerland 99 229 262 258 262 + 1.4% + 8.4%
Norway 65 67 88 88 88 - 0.5% + 2.5%
Croatia 55 83 79 80 80 - 0.1% + 3.2%
Iceland 10 13 12 12 11 - 7.6% + 0.8%

United States of America (E) 833 1 387 1 896 1 938 2 003 + 3.4% + 7.6%
Mexico 370 536 532 603 711 + 18.0% + 5.6%
Canada 162 247 312 327 325 - 0.7% + 6.0%
208 208
Table 9. Production of fermented products (continued)

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
South America
Argentina 243 405 490 517 503 - 2.7% + 6.3%
Chile - - 210 236 244 + 3.4%
Colombia 102 140 144 149 172 + 15.1% + 4.5%
Uruguay (E) 18 25 33 34 36 + 4.3% + 5.9%
Africa
South Africa - - 308 324 315 - 2.6%
Egypt - - 242 212 210 - 0.9%
(A) Kefir excluded. (B)Including dairy desserts. (C) Including dairy desserts and mixed drinks.
(D) Production volume excluding added ingredients. (E) Production of yoghurt only.
209 209
Table 10. Production of cream for consumption

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
EU 27 2 306 2 470 2 465 2 440 2 544 + 4.3% + 0.8%

Germany 671 678 556 547 542 - 0.9% - 1.8%
France 301 337 342 362 380 + 5.1% + 2.0%
Poland 300 313 344 340 357 + 5.0% + 1.5%
United Kingdom 270 305 260 248 250 + 0.8% - 0.6%
Belgium 95 123 156 160 176 + 10.0% + 5.3%
Spain 68 75 118 112 153 + 37.6% + 7.0%
Italy 119 117 124 126 126 + 0.4% + 0.5%
Sweden 96 89 110 110 113 + 2.5% + 1.3%
Austria 55 59 62 63 63 - 0.6% + 1.2%
Denmark 58 63 58 57 54 - 5.3% - 0.7%
Czech Republic 37 40 51 47 47 - 0.6% + 2.0%
Finland 39 39 35 38 43 + 12.8% + 0.9%
Latvia 2 26 31 26 36 + 39.9% + 27.7%
Slovakia 20 35 29 35 32 - 8.1% + 4.2%
Estonia 19 24 33 28 27 - 2.2% + 3.2%
Ireland 22 22 21 21 21 + 1.4% - 0.1%
Portugal 13 17 18 18 18 + 3.2% + 3.2%
Cyprus 7 7 11 11 11 0.0% + 4.0%
Netherlands 47 29 16 7 9 + 34.5% - 12.8%
Hungary 10 9 6 5 5 0.0% - 5.2%
Lithuania 1 1 1 2 2 0.0% + 3.4%
Other 60 62 84 80 80 - 0.6% + 2.4%

United States of America 1 209 1 661 1 694 1 687 1 638 - 2.9% + 2.6%
Canada 216 278 289 311 347 + 11.6% + 4.0%
Mexico 88 73 105 107 124 + 15.8% + 2.9%
Asia
Japan 73 92 107 112 113 + 1.2% + 3.7%
Iran - - 85 110 110 0.0%
Israel - - 33 36 38 + 5.6%
Korea, Republic of - - 21 19 31 + 60.2%
Pakistan (A) - 1 2 2 2 0.0%
Other Europe
Russia - - 79 80 80 0.0%
Switzerland 68 65 68 70 70 - 0.1% + 0.2%
Norway 34 37 46 48 49 + 2.3% + 3.1%
Ukraine - - 20 33 36 + 9.8%
Croatia - - 26 26 26 + 2.3%
Iceland 2 2 2 2 2 + 4.8% + 1.7%
South America
Argentina 32 38 40 43 38 - 13.0% + 1.4%
Chile - 20 30 31 35 + 9.6%
Colombia 8 12 20 20 21 + 5.1% + 7.9%
Uruguay - 4 7 9 9 0.0%
Africa
Egypt - - 6 5 2 - 60.0%
(A) Dairy years ending June of the following year.
210 210
Table 11. Production of butter and butteroil

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
Asia
India (A) 1 900 2 712 4 162 4 330 4 525 + 4.5% + 7.5%
Pakistan (B) 493 580 649 669 669 0.0% + 2.6%
Japan (C) 88 84 74 63 69 + 9.9% - 2.0%
China 15 30 50 59 55 - 7.7% + 11.4%
Iran (C) - - 68 45 41 - 8.9%
Turkey 22 24 33 35 40 + 14.8% + 5.3%
Kazakhstan 4 20 13 14 14 - 2.6% + 10.1%
Israel 5 6 5 6 6 0.0% + 1.4%
Mongolia - 1 1 1 2 + 48.1%
EU 27 2 096 2 141 1 980 2 038 2 058 + 1.0% - 0.2%

Germany 425 455 449 474 486 + 2.5% + 1.1%
France 442 402 394 416 402 - 3.2% - 0.8%
Netherlands 147 177 190 200 209 + 4.7% + 3.0%
Poland 139 179 175 171 177 + 3.0% + 2.0%
Ireland 148 146 135 146 149 + 1.9% + 0.0%
United Kingdom 132 130 120 130 145 + 11.5% + 0.8%
Belgium (D) 158 172 132 121 112 - 7.7% - 2.8%
Italy 133 130 95 89 90 + 1.1% - 3.2%
Finland 55 50 47 42 41 - 0.7% - 2.4%
Denmark 46 44 33 37 39 + 6.5% - 1.3%
Spain 39 58 38 42 37 - 12.8% - 0.5%
Austria 36 31 33 34 35 + 2.0% - 0.2%
Czech Republic (C) 64 42 33 31 32 + 2.9% - 5.7%
Portugal 25 27 27 28 28 + 2.8% + 1.2%
Sweden 30 27 20 19 19 - 1.6% - 3.9%
Slovakia 16 8 10 12 12 + 0.4% - 2.2%
Lithuania 19 14 9 9 11 + 12.8% - 4.9%
Hungary 11 11 10 9 9 + 1.1% - 1.2%
Latvia 7 7 7 5 6 + 5.7% - 2.1%
Estonia 9 8 6 7 4 - 35.4% - 6.0%
Cyprus 1 1 0 0 0 - 66.7% - 12.6%
Other 16 23 16 16 16 - 1.8% + 0.1%

United States of America 570 611 709 821 844 + 2.8% + 3.3%
Canada (E) 77 86 83 90 99 + 10.8% + 2.2%
Mexico 16 18 14 15 19 + 29.7% + 1.6%
Oceania
New Zealand 374 424 441 472 499 + 5.7% + 2.4%
Australia (B) 176 146 122 120 118 - 1.2% - 3.3%
211 211
Table 11. Production of butter and butteroil (continued)

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
Other Europe
Russia 270 277 207 217 216 - 0.5% - 1.8%
Belarus (C) 65 85 99 104 113 + 8.2% + 4.7%
Ukraine 135 120 80 77 88 + 14.3% - 3.5%
Switzerland 37 39 49 49 49 - 0.8% + 2.4%
Norway 23 9 14 13 14 + 14.4% - 3.9%
Croatia 2 4 5 5 4 - 8.5% + 6.6%
Iceland 2 2 2 2 2 - 4.8% + 2.4%
South America
Brazil 72 77 78 79 81 + 2.5% + 1.0%
Argentina 47 40 49 54 53 - 1.5% + 1.0%
Uruguay 14 18 16 26 31 + 20.5% + 6.8%
Chile 11 15 22 22 23 + 6.6% + 6.4%
Colombia 5 5 6 6 7 + 3.2% + 2.1%
Africa
Egypt (C) 10 6 15 17 16 - 5.9% + 4.0%
South Africa 9 11 12 12 13 + 8.3% + 2.7%
Zimbabwe - - 2 2 2 0.0%
(A) Dairy years ending March of the following year. (B) Dairy years ending June of the following year. (C) Production of butter only.
(D) Production including reprocessed butter (years: 2010, 2011 and 2012: calculated).
(E) Production of butter and whey butter only.
212 212
Table 12. Production of cheese

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
EU 27 7 232 7 998 8 553 8 666 8 785 + 1.4% + 1.6%

Germany 1 686 1 924 2 168 2 196 2 240 + 2.0% + 2.4%
France (A) 1 612 1 685 1 756 1 771 1 765 - 0.3% + 0.8%
Italy (B) 927 1 054 1 064 1 096 1 095 - 0.1% + 1.4%
Netherlands 684 672 753 749 764 + 2.1% + 0.9%
Poland 404 515 638 669 710 + 6.1% + 4.8%
United Kingdom 302 346 337 355 355 + 0.0% + 1.4%
Denmark 306 356 292 276 300 + 8.7% - 0.2%
Ireland 99 119 172 180 185 + 2.9% + 5.4%
Austria 119 145 155 160 165 + 3.6% + 2.8%
Lithuania 40 79 100 104 118 + 13.0% + 9.4%
Spain (B) 111 136 124 133 113 - 15.4% + 0.1%
Czech Republic 92 118 111 110 111 + 1.2% + 1.6%
Sweden 127 118 103 103 101 - 2.0% - 1.8%
Finland 98 97 101 101 92 - 8.2% - 0.5%
Belgium 58 61 71 76 76 - 0.5% + 2.2%
Portugal (C) 67 66 69 72 72 - 0.3% + 0.6%
Hungary 101 77 77 69 68 - 1.7% - 3.3%
Estonia 22 28 38 41 41 + 2.0% + 5.4%
Slovakia 51 43 30 32 33 + 4.3% - 3.6%
Latvia 22 33 31 28 31 + 13.4% + 3.1%
Cyprus (C) 12 13 13 14 14 0.0% + 1.5%
Other 293 314 352 333 336 + 0.8% + 1.1%

Canada 292 310 344 335 341 + 1.9% + 1.3%
Mexico 134 134 211 275 292 + 5.9% + 6.7%
South America
Brazil 445 495 648 679 700 + 3.1% + 3.8%
Argentina 443 408 506 521 538 + 3.2% + 1.6%
Chile (D) 52 78 73 90 91 + 1.8% + 4.8%
Uruguay 28 38 58 61 69 + 13.9% + 7.9%
Colombia 24 33 39 41 42 + 2.3% + 4.9%
Other Europe
Russia 221 371 433 425 446 + 4.8% + 6.0%
Ukraine 94 358 286 255 244 - 3.9% + 8.3%
Switzerland 167 168 181 182 181 - 0.2% + 0.7%
Belarus 41 82 146 142 147 + 3.7% + 11.2%
Norway 81 84 84 84 85 + 1.1% + 0.4%
Croatia 19 26 29 30 31 + 5.4% + 4.2%
Iceland 6 7 8 7 7 + 9.1% + 2.0%
213 213
Table 12. Production of cheese (continued)

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
Asia
Turkey 219 230 473 519 564 + 8.7% + 8.2%
Iran 221 220 275 260 268 + 3.1% + 1.6%
Israel 99 106 122 125 128 + 2.4% + 2.2%
Japan (E) 34 39 46 45 47 + 2.4% + 2.7%
China (F) - 15 17 20 30 + 48.5%
Kazakhstan 8 15 15 17 19 + 13.8% + 7.0%
India (G) (H) - - 8 10 10 0.0%
Mongolia - 0 0 0 0 + 328.6%
Oceania
Australia (I) 376 373 339 343 339 - 1.3% - 0.9%
New Zealand (G) 289 280 268 270 310 + 14.8% + 0.6%
Africa
Egypt 380 480 570 620 569 - 8.2% + 3.4%
South Africa 35 42 45 47 68 + 44.6% + 5.6%
Zimbabwe - - 2 2 3 + 5.1%
(A) Production: not including goats milk cheese (102 700 tonnes) and sheeps milk cheese (58 800 tonnes).
(B) Production of cow's milk cheese only. (C) All kinds of milk.
(D) Based on big dairies production; total production of cheese (including small dairies): ~ 130 700 tonnes.
(E) Production of natural cheese in the fiscal years (ending March of the following year).
(F) Including processed cheese, made from imported natural cheese. (G) Including processed cheese.
(H) Refers to cooperative dairies only. This may not reflect the development for the total Indian dairy industry; dairy years ending March of the
following year.
(I) Dairy years ending June of the following year.
214 214
Table 13. Production of whole and semi-skimmed milk powder

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
Oceania
New Zealand 515 675 947 1 141 1 250 + 9.6% + 7.7%
Australia (A) 205 158 151 140 140 - 0.3% - 3.1%
Asia
China (B) 522 918 1 000 1 045 1 099 + 5.2% + 6.4%
India (C) - 74 98 99 99 0.0%
Turkey - - - 24 35 + 47.5%
Japan 18 14 13 14 13 - 12.6% - 3.1%
Korea, Republic of 5 5 3 2 2 - 11.1% - 9.8%
South America
Brazil 256 440 500 515 531 + 3.1% + 6.3%
Argentina 202 254 205 280 278 - 0.4% + 2.7%
Colombia - - 121 119 123 + 3.0%
Chile 52 51 63 74 74 - 0.0% + 3.0%
Uruguay 19 37 54 56 58 + 3.8% + 10.0%
EU 27 946 849 753 743 722 - 2.9% - 2.2%

Germany 185 161 155 173 179 + 3.6% - 0.3%
Netherlands 97 107 135 131 121 - 7.8% + 1.9%
France 258 193 122 115 113 - 1.8% - 6.6%
Denmark 81 79 106 97 83 - 14.2% + 0.2%
Belgium 65 79 65 50 48 - 4.2% - 2.4%
Poland 30 50 28 34 38 + 13.3% + 1.9%
United Kingdom (D) 105 52 45 46 36 - 20.5% - 8.5%
Sweden 5 32 23 23 36 + 58.3% + 17.3%
Ireland 42 39 34 38 26 - 31.6% - 4.0%
Czech Republic 23 17 12 12 12 - 2.4% - 5.1%
Portugal 9 9 10 9 9 - 6.5% - 0.5%
Slovakia 4 7 4 4 4 + 15.8% + 0.6%
Finland 2 2 4 4 4 + 5.6% + 5.5%
Latvia 1 2 3 3 6 + 95.8% + 20.3%
Lithuania 12 0 3 1 2 + 14.3% - 15.6%
Spain 12 6 2 1 1 - 9.1% - 18.7%
Austria 3 1 0 0 0 0.0% - 17.5%
Hungary 3 1 0 0 0 - 100.0%
Other 9 13 2 1 2 + 117.6% - 10.5%

Mexico 110 124 134 128 124 - 3.2% + 1.0%
United States of America 51 15 32 30 26 - 11.4% - 5.3%
215 215
Table 13. Production of whole and semi-skimmed milk powder (continued)

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
Other Europe
Russia 75 80 47 76 67 - 11.8% - 0.9%
Belarus 14 38 45 33 40 + 22.7% + 9.4%
Switzerland 13 20 15 21 21 - 2.3% + 3.8%
Ukraine 7 29 15 14 16 + 18.1% + 7.0%
Norway 1 1 1 1 1 0.0% 0.0%
Croatia - 1 0 0 0 0.0%
Iceland 0 0 0 0 0 - 33.3% 0.0%
Africa
Egypt - - 52 54 57 + 6.1%
South Africa 10 16 16 17 18 + 5.9% + 4.7%
Zimbabwe - - 6 6 0 - 100.0%
(A) Dairy years ending June of the following year. (B) Including infant formula.
(C) Refers to cooperative dairies only. This may not reflect the development for the total Indian dairy industry; dairy years ending March of the
following year.
(D) Years 2010, 2011 and 2012: estimated.
216 216
Table 14. Production of skim milk powder

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
EU 27 1 259 1 070 1 078 1 212 1 211 - 0.1% - 0.3%

France 279 276 320 358 353 - 1.5% + 2.0%
Germany 335 257 259 301 314 + 4.2% - 0.5%
Poland 119 142 93 115 116 + 0.9% - 0.2%
Belgium 70 77 83 104 102 - 1.6% + 3.2%
Netherlands 69 53 64 62 66 + 6.6% - 0.4%
United Kingdom (A) 83 69 65 66 52 - 20.5% - 3.8%
Ireland 79 56 60 67 52 - 21.4% - 3.4%
Denmark 38 15 27 36 40 + 11.8% + 0.4%
Sweden 41 17 26 28 26 - 7.5% - 3.8%
Finland 24 21 17 16 20 + 31.0% - 1.4%
Lithuania 29 11 12 16 19 + 15.6% - 3.7%
Czech Republic 35 32 14 14 16 + 18.0% - 6.0%
Spain 4 5 9 5 12 + 141.2% + 9.8%
Portugal 11 6 9 7 9 + 19.4% - 1.7%
Austria 13 8 7 6 5 - 13.8% - 7.7%
Latvia 4 2 4 3 4 + 39.3% + 1.2%
Slovakia 7 6 2 2 2 - 14.2% - 11.1%
Hungary 5 1 0 0 0 + 50.0% - 20.5%
Other 16 15 8 8 3 - 58.0% - 12.2%

Canada 75 73 72 76 85 + 11.7% + 1.0%
Mexico - 9 23 26 60 + 131.9%
Asia
India (B) 145 251 380 430 450 + 4.7% + 9.9%
Japan 194 187 156 137 139 + 1.1% - 2.8%
Iran - 10 16 50 55 + 10.0%
Turkey - - - 56 49 - 11.5%
China 58 60 55 34 21 - 40.2% - 8.3%
Israel - - 5 9 9 - 6.6%
Pakistan (C) 0 0 3 3 3 0.0%
Oceania
New Zealand 251 250 344 366 386 + 5.5% + 3.7%
Australia (C) 265 228 222 230 251 + 8.8% - 0.5%
South America
Brazil 62 113 130 132 141 + 6.8% + 7.1%
Uruguay 12 9 12 28 34 + 22.5% + 8.8%
Argentina 45 16 34 39 32 - 17.4% - 2.8%
Chile 8 12 19 19 19 + 2.2% + 7.6%
Colombia - - 6 6 6 + 2.0%
217 217
Table 14. Production of skim milk powder (continued)

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
Other Europe
Belarus 28 46 61 56 77 + 37.3% + 8.8%
Russia 91 92 63 55 57 + 3.6% - 3.9%
Ukraine 61 83 53 36 44 + 23.0% - 2.7%
Switzerland 23 26 33 29 30 + 2.4% + 2.0%
Norway 5 7 7 9 10 + 11.1% + 5.9%
Iceland 0 0 1 1 1 - 18.2% + 7.0%
Croatia 3 3 0 1 0 - 60.0% - 20.2%
Africa
South Africa 8 15 16 17 18 + 5.9% + 6.9%
Zimbabwe - - 1 1 0 - 100.0%
(A) Years 2010, 2011 and 2012: estimated. (B) Dairy years ending March of the following year.
(C) Dairy years ending June of the following year.
218 218
Table 15. Production of condensed milk

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12

United States of America 729 861 1 037 1 034 1 058 + 2.4% + 3.2%
Mexico 153 162 165 165 165 0.0% + 0.6%
Canada (A) 103 46 33 36 30 - 15.8% - 9.7%
EU 27 1 286 1 160 1 153 1 109 1 202 + 8.3% - 0.6%

Germany 567 458 420 412 444 + 7.7% - 2.0%
Netherlands 274 292 347 354 371 + 4.7% + 2.6%
United Kingdom (B) 162 143 101 108 104 - 3.6% - 3.6%
Belgium 68 80 87 54 97 + 79.4% + 2.9%
Poland 24 33 55 52 58 + 10.3% + 7.6%
Spain 58 60 46 35 34 - 3.7% - 4.4%
Lithuania 4 5 25 22 23 + 6.0% + 15.6%
Czech Republic 24 16 15 14 14 + 4.5% - 4.3%
France 32 14 14 11 11 + 0.5% - 8.8%
Sweden 10 1 1 3 1 - 49.5% - 14.5%
Hungary 2 1 0 0 0 0.0% - 18.1%
Estonia 1 0 - - -
Italy 1 1 - - -
Other 59 56 43 44 44 + 0.6% - 2.4%
South America
Peru 222 328 409 418 441 + 5.5% + 5.9%
Brazil (C) 250 250 330 325 325 0.0% + 2.2%
Chile 24 40 37 35 40 + 15.1% + 4.3%
Argentina 12 6 7 6 7 + 3.1% - 4.9%
Colombia 4 4 4 4 7 + 65.5% + 3.4%
Other Europe
Russia 249 227 332 341 341 0.0% + 2.7%
Belarus 41 59 120 124 125 + 0.7% + 9.7%
Ukraine 47 104 96 62 65 + 4.4% + 2.7%
Switzerland 3 3 3 3 3 0.0% - 0.3%
Croatia 7 0 0 0 2 - 9.2%
Norway 14 11 1 1 1 0.0% - 19.9%
Asia
China 80 150 165 165 165 0.0% + 6.2%
Japan 41 42 42 42 43 + 3.1% + 0.5%
Africa
South Africa 57 54 54 54 38 - 28.9% - 3.2%
Egypt - - 0 0 0 - 9.1%
(A) From year 2010: condensed skim milk not included. (B) Chocolate crumb included.
(C) Estimation, based on consumption and trade figures.
219 219
Table 16. Production of whey powder

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
EU 27 1 877 1 689 1 945 1 972 2 088 + 5.9% + 0.9%

France 622 614 638 635 605 - 4.7% - 0.2%
Germany 228 356 369 372 370 - 0.3% + 4.1%
Netherlands 340 233 320 331 353 + 6.5% + 0.3%
Italy 348 164 121 107 205 + 91.9% - 4.3%
Poland 50 75 130 135 168 + 24.4% + 10.6%
Ireland 35 35 100 100 108 + 7.4% + 9.8%
Czech Republic 20 29 33 44 48 + 10.5% + 7.6%
Finland 89 36 40 40 36 - 8.8% - 7.2%
Austria 2 11 26 32 36 + 13.4% + 28.4%
Denmark 27 23 27 29 29 0.0% + 0.5%
Spain 10 12 27 35 25 - 28.0% + 8.0%
Lithuania 6 18 22 22 19 - 15.1% + 10.0%
Portugal 9 12 16 18 16 - 15.0% + 4.8%
Latvia 0 0 1 6 4 - 33.3%
Estonia 0 1 6 6 5 - 14.6% + 30.4%
Hungary 10 2 5 5 6 + 7.7% - 4.7%
Sweden 6 4 3 3 3 - 5.1% - 5.3%
Slovakia 20 13 13 3 3 0.0% - 15.4%
Other 56 50 50 50 50 0.0% - 0.9%

United States of America (A) 591 517 498 498 494 - 0.9% - 1.5%
Canada 59 24 22 23 21 - 8.8% - 8.4%
Asia
Turkey 658 463 - 29.7%
Israel 12 12 12 0.0%
Iran - - - 7 8 + 20.0%
South America
Argentina 19 13 36 43 73 + 71.1% + 11.7%
Chile 15 24 29 27 27 - 0.3% + 4.8%
Uruguay - 8 26 54 17 - 68.0%
Oceania
Australia (B) 105 98 61 65 61 - 6.0% - 4.5%
New Zealand - - 9 16 7 - 59.5%
Other Europe
Russia - - 41 41 41 0.0%
Croatia - - 5 4 4 - 2.2%
Norway 1 1 3 3 3 + 13.3% + 10.7%
Switzerland 3 2 1 2 3 + 17.4% + 0.4%
Africa
South Africa - - 13 14 15 + 7.1%
(A) Condensed whey included. (B) Dairy years ending June of the following year.
220 220
Table 17. World and selected countries exports in butter and butteroil
1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
New Zealand 352 333 395 414 463 + 11.9% + 2.3%
EU 27 (A) 186 317 155 124 126 + 1.2% - 3.2%

France 27 31 26 28 31 + 11.3% + 1.1%
Netherlands 46 78 41 27 24 - 9.7% - 5.3%
Finland 22 24 18 16 18 + 12.4% - 1.7%
Denmark 18 18 10 12 13 + 3.2% - 2.7%
Germany 12 22 22 12 11 - 11.7% - 0.4%
Belgium 15 45 17 11 9 - 15.4% - 3.8%
Ireland 13 25 8 6 7 + 15.8% - 4.7%
Other EU 34 73 13 12 13 + 6.6% - 7.8%
Belarus 17 51 63 65 85 + 31.4% + 14.4%

Australia 115 68 57 44 56 + 27.0% - 5.9%
United States of America 9 12 56 64 49 - 23.7% + 15.2%
Uruguay 5 13 10 18 31 + 73.4% + 15.9%
Argentina 9 7 15 27 20 - 23.5% + 7.4%
Switzerland 0 0 4 10 11 + 18.4% + 65.8%
Singapore 4 4 5 5 8 + 68.3% + 6.3%
Rest of world 55 106 49 30 33 + 8.0% - 4.2%
World 753 911 809 800 882 + 10.3% + 1.3%
Table 18. World and selected countries exports trade in cheese

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
EU 27 (A) 526 554 676 680 774 + 13.9% + 3.3%

Germany 81 97 148 129 147 + 13.6% + 5.1%
Netherlands 78 78 98 103 123 + 19.0% + 3.9%
France 92 81 91 97 100 + 3.2% + 0.7%
Italy 56 66 73 74 83 + 11.3% + 3.3%
Poland 17 24 39 35 53 + 50.9% + 10.2%
Denmark 70 59 42 47 49 + 4.7% - 2.9%
Lithuania 26 24 30 37 43 + 16.0% + 4.2%
Other EU 106 125 156 157 176 + 12.4% + 4.3%
New Zealand 257 273 265 253 306 + 20.9% + 1.4%

Australia 233 208 160 173 170 - 2.1% - 2.6%
Belarus 17 65 129 132 143 + 8.4% + 19.5%
Egypt 2 18 158 148 75 - 49.3% + 36.7%
Ukraine 12 116 79 80 68 - 15.9% + 15.1%
Switzerland 58 57 64 65 67 + 3.7% + 1.2%
Argentina 25 52 46 61 59 - 2.5% + 7.4%
Uruguay 17 32 40 47 47 + 0.9% + 9.0%
Rest of world 110 197 300 369 480 + 30.1% + 13.0%
World 1 308 1 630 2 090 2 232 2 449 + 9.7% + 5.4%

(A) Intra-trade excluded for all member states.
221 221
Table 19. World and selected countries exports in whole and semi-skimmed milk powder
1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
New Zealand 426 599 948 1 110 1 257 + 13.2% + 9.4%
EU 27 (A) 584 498 448 390 388 - 0.6% - 3.4%

Netherlands 158 143 142 127 130 + 2.7% - 1.6%
Denmark 71 74 93 88 76 - 14.1% + 0.5%
Belgium 42 73 73 53 38 - 27.6% - 0.8%
United Kingdom 73 48 35 26 34 + 31.2% - 6.3%
France 168 71 34 31 33 + 6.3% - 12.6%
Sweden 0 19 24 19 30 + 59.9% + 57.8%
Other EU 71 70 48 47 46 - 0.3% - 3.5%
Argentina 98 162 129 202 218 + 7.8% + 6.9%

Australia 203 157 115 119 113 - 5.2% - 4.8%
Uruguay 14 37 63 58 60 + 3.1% + 13.0%
Singapore 5 26 64 51 53 + 2.3% + 21.9%
Belarus 13 31 39 27 34 + 26.8% + 8.3%
Philippines 7 36 38 44 21 - 52.2% + 9.2%
United States of America 29 19 53 22 21 - 3.2% - 2.8%
Chile 2 6 9 14 14 + 3.4% + 17.0%
Rest of world 104 323 160 143 174 + 21.7% + 4.3%
World 1 486 1 893 2 063 2 180 2 352 + 7.9% + 3.9%
Table 20. World and selected countries exports in skim milk powder
1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
EU 27 (A) 449 190 379 518 523 + 1.1% + 1.3%

Belgium 66 19 99 119 109 - 8.2% + 4.3%
France 35 14 65 96 109 + 13.3% + 10.0%
Germany 72 29 50 104 107 + 3.5% + 3.4%
Netherlands 67 28 55 71 55 - 22.9% - 1.7%
Poland 71 38 31 44 41 - 7.2% - 4.4%
Ireland 50 12 22 29 19 - 34.4% - 7.8%
Other EU 88 51 56 55 83 + 52.4% - 0.5%
New Zealand 166 225 343 362 390 + 7.7% + 7.4%
Australia 219 166 132 142 170 + 19.9% - 2.1%
Belarus 28 44 61 55 76 + 37.6% + 8.6%
India 8 53 11 0 65 > 1 000% + 19.5%
Uruguay 13 11 12 28 33 + 16.1% + 8.4%
Ukraine 49 57 14 22 26 + 17.6% - 5.2%
Switzerland 11 14 22 14 16 + 10.4% + 3.2%
Argentina 22 16 20 19 14 - 24.0% - 3.6%
Rest of world 140 76 84 101 37 - 63.0% - 10.4%
World 1 207 1 132 1 463 1 696 1 795 + 5.9% + 3.4%
222 222
Table 21. World and selected countries imports in butter and butteroil
1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
Russia 71 116 134 132 192 + 45.0% + 8.6%

China 3 13 23 36 48 + 35.3% + 25.8%
Iran 20 43 56 55 45 - 18.2% + 7.1%
EU 27 (A) 78 80 38 45 44 - 2.1% - 4.6%

Netherlands 12 40 3 3 25 + 691.9% + 6.2%
Other EU 66 40 35 42 19 - 55.2% - 9.9%
Egypt 50 39 82 81 36 - 55.1% - 2.6%

Singapore 18 29 23 24 26 + 5.9% + 2.9%
Australia 11 10 19 23 25 + 8.2% + 7.5%
Mexico 34 71 24 16 20 + 21.5% - 4.4%
Philippines 12 12 23 22 19 - 13.0% + 3.7%
Turkey 4 6 12 10 16 + 55.5% + 12.6%
United States of America 22 63 9 12 16 + 34.8% - 2.9%
Malaysia 11 11 12 13 15 + 13.9% + 2.8%
Algeria 6 11 8 19 14 - 23.5% + 7.5%
Indonesia 12 13 15 15 14 - 4.4% + 1.7%
Thailand 13 11 9 12 12 - 5.3% - 0.6%
Rest of world 388 383 322 284 339 + 19.7% - 1.1%
World 753 911 809 800 882 + 10.3% + 1.3%
Table 22. World and selected countries imports in cheese

1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
Russia 52 325 421 411 531 + 29.3% + 21.4%

Japan 205 212 199 215 235 + 9.0% + 1.1%
United States of America 192 211 139 142 154 + 8.3% - 1.8%
Mexico 54 79 81 79 99 + 26.0% + 5.2%
EU 27 (A) 143 95 79 75 77 + 3.3% - 5.0%

Germany 22 16 22 26 29 + 13.2% + 2.4%
Netherlands 31 24 17 13 15 + 13.8% - 5.9%
Other EU 90 55 40 36 34 - 7.4% - 7.9%
Australia 38 54 76 75 74 - 1.2% + 5.7%

Switzerland 31 32 47 49 51 + 4.1% + 4.3%
China 2 7 23 29 39 + 35.7% + 28.0%
Lebanon 30 30 33 33 34 + 2.2% + 1.1%
El Salvador 8 18 27 29 31 + 7.8% + 11.3%
Venezuela 12 7 20 15 29 + 93.3% + 7.7%
Brazil 16 3 22 37 28 - 26.5% + 4.8%
Algeria 19 23 22 19 26 + 37.6% + 3.0%
Rest of world 475 490 843 947 963 + 1.6% + 6.1%
World 1 308 1 630 2 090 2 232 2 449 + 9.7% + 5.4%

223 223
Table 23. World and selected countries imports in whole and semi-skimmed milk powder
1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
China 51 64 326 320 406 + 26.9% + 18.9%

Venezuela 65 46 50 104 211 + 103.8% + 10.4%
Algeria 117 170 167 203 188 - 7.6% + 4.0%
Singapore 22 61 83 81 74 - 8.1% + 10.6%
Brazil 108 29 52 86 71 - 17.8% - 3.5%
Sri Lanka 46 46 67 76 71 - 6.9% + 3.7%
Hong Kong 46 23 39 51 64 + 24.6% + 2.7%
Colombia 9 0 0 9 62 + 603.4% + 17.8%
Indonesia 26 67 43 68 61 - 9.6% + 7.5%
Russia 22 37 40 20 46 + 133.9% + 6.3%
Egypt 10 14 42 39 37 - 5.1% + 11.8%
Thailand 48 33 32 33 37 + 12.7% - 2.2%
Philippines 56 36 33 28 35 + 22.5% - 3.9%
Malaysia 58 67 24 28 30 + 4.5% - 5.4%
Dominican Republic 30 28 31 25 25 0.0% - 1.6%
Peru 14 6 9 9 21 + 142.3% + 3.7%
Senegal 14 26 29 19 20 + 5.9% + 3.1%
Lebanon 15 16 16 14 15 + 5.2% - 0.1%
Australia 5 8 9 16 13 - 18.7% + 8.7%
Rest of world 725 1 115 973 953 867 - 9.1% + 1.5%
World 1 486 1 893 2 063 2 180 2 352 + 7.9% + 3.9%
Table 24. World and selected countries imports in skim milk powder
1 000 tonnes Annual
2000 2005 2010 2011 2012 growth CAGR
Country '11-'12 '00-'12
Mexico 129 155 166 191 266 + 39.8% + 6.2%

China 22 43 89 130 168 + 29.0% + 18.5%
Russia 39 64 117 70 148 + 111.1% + 11.7%
Indonesia 83 87 132 128 136 + 6.6% + 4.3%
Algeria 91 84 98 125 112 - 10.7% + 1.7%
Philippines 111 87 110 111 106 - 4.8% - 0.4%
Malaysia 75 57 88 96 104 + 9.1% + 2.8%
Vietnam 30 50 85 85 77 - 10.0% + 8.1%
Thailand 53 70 59 64 63 - 1.6% + 1.4%
Singapore 39 61 62 61 60 - 1.4% + 3.6%
Egypt 21 18 45 43 60 + 38.6% + 9.1%
Brazil 30 5 14 31 34 + 7.7% + 0.8%
Japan 52 34 30 27 32 + 18.8% - 3.9%
Pakistan 5 6 18 28 30 + 9.8% + 17.1%
Nigeria 14 19 27 32 30 - 7.4% + 6.4%
Peru 13 7 17 13 25 + 101.0% + 5.6%
Kazakhstan 2 17 10 18 24
Korea, Republic of 3 6 8 34 19 - 43.9% + 16.5%
Iran 5 6 5 10 16 + 64.3% + 9.6%
Rest of world 389 255 282 400 285 - 28.6% - 2.5%
World 1 207 1 132 1 463 1 696 1 795 + 5.9% + 3.4%
224 224
Table 25. Liquid milk consumption

1 000 tonnes Annual kg per capita
2010 2011 2012 growth CAGR 2010 2011 2012
Country '11-'12 '10-'12
Asia
India (A) 49 140 51 660 52 000 + 0.7% + 2.9% 41.3 41.6 41.3
China 14 842 16 689 21 519 + 28.9% + 20.4% 11.1 12.4 15.9
Japan (A) 4 066 4 040 4 040 0.0% - 0.3% 31.8 31.6 31.6
Korea, Republic of 1 641 1 624 1 685 + 3.8% + 1.3% 33.6 33.1 34.5
Iran 2 850 1 550 1 500 - 3.2% - 27.5% 37.9 19.9 19.0
Turkey 1 079 1 149 1 232 + 7.2% + 6.9% 14.8 15.6 16.5
Israel 422 424 438 + 3.3% + 1.9% 55.5 53.7 55.4
Kazakhstan (B) 337 381 429 + 12.8% + 12.8% 21.2 23.6 26.4
Mongolia 18 21 26 + 23.6% + 20.9% 6.5 7.6 9.2
EU 27 32 419 32 133 32 107 - 0.1% - 0.5% 64.9 64.3 64.0

United Kingdom 6 701 6 706 6 667 - 0.6% - 0.2% 108.0 107.4 106.2
Germany 4 377 4 396 4 431 + 0.8% + 0.6% 53.5 54.7 55.0
Spain 3 876 3 906 3 889 - 0.4% + 0.2% 84.1 84.1 83.2
France 3 503 3 445 3 454 + 0.2% - 0.7% 55.6 54.4 54.3
Italy 3 439 3 398 3 315 - 2.4% - 1.8% 56.8 55.9 54.4
Poland 1 670 1 621 1 611 - 0.6% - 1.8% 43.7 42.4 42.2
Sweden 913 867 876 + 1.1% - 2.0% 97.3 91.8 92.1
Portugal 856 851 859 + 0.9% + 0.2% 80.8 80.3 81.0
Netherlands 831 818 818 0.0% - 0.8% 50.0 49.0 49.0
Finland 715 708 715 + 1.0% - 0.0% 132.5 131.1 132.4
Austria (C) 649 670 659 - 1.6% + 0.8% 77.2 79.8 77.6
Ireland (D) 637 644 644 0.0% + 0.6% 141.5 139.9 139.9
Czech Republic 607 558 624 + 11.8% + 1.4% 57.5 52.6 58.5
Belgium 581 568 561 - 1.2% - 1.7% 53.8 51.6 50.5
Denmark 501 495 504 + 1.7% + 0.3% 91.1 88.4 90.0
Hungary 511 486 501 + 3.2% - 1.0% 51.1 48.6 50.6
Slovakia 296 282 296 + 5.0% - 0.0% 54.9 52.2 54.9
Latvia 185 197 197 0.0% + 3.1% 88.5 94.8 94.8
Estonia (C) 173 162 162 0.0% - 3.0% 132.8 124.8 124.8
Lithuania 91 89 97 + 9.0% + 3.6% 27.5 27.9 30.4
Cyprus 83 82 87 + 5.7% + 2.7% 100.8 98.1 101.0
Luxembourg (D) 20 17 20 + 17.4% - 0.1% 39.2 32.8 38.0
Other 1 207 1 167 1 120 - 4.1% - 3.7% 28.2 27.3 26.3

United States of America 24 798 24 376 23 972 - 1.7% - 1.7% 80.1 78.2 76.4
Mexico 4 405 4 357 4 168 - 4.3% - 2.7% 39.8 38.0 35.9
Canada (E) 2 737 2 770 2 774 + 0.1% + 0.7% 80.2 80.3 79.5
South America
Brazil 11 278 11 429 11 715 + 2.5% + 1.9% 57.8 58.0 59.0
Colombia 2 938 2 946 2 922 - 0.8% - 0.3% 63.3 62.6 61.3
Argentina 1 647 1 729 1 729 0.0% + 2.4% 40.7 42.7 42.4
Chile 378 381 401 + 5.3% + 2.9% 22.1 22.0 23.0
Uruguay 231 234 235 + 0.6% + 0.9% 68.0 68.8 69.2
225 225
Table 25. Liquid milk consumption (continued)

2010 2011 2012 growth CAGR 2010 2011 2012
Country '11-'12 '10-'12
Other Europe
Russia 5 049 5 059 5 336 + 5.5% + 2.8% 35.6 35.4 37.3
Ukraine 785 849 907 + 6.8% + 7.5% 17.1 18.6 19.9
Switzerland 563 548 536 - 2.1% - 2.4% 72.2 69.3 67.0
Norway 414 409 433 + 5.9% + 2.3% 84.5 81.8 86.6
Croatia 307 345 316 - 8.4% + 1.5% 69.8 78.4 73.5
Iceland 34 33 32 - 2.7% - 2.7% 107.2 103.1 99.1
Africa
Egypt 1 763 1 869 1 975 + 5.7% + 5.8% 22.6 23.5 24.5
South Africa 1 297 1 564 1 248 - 20.2% - 1.9% 25.2 30.1 23.8
Oceania
Australia (F) 2 385 2 461 2 514 + 2.2% + 2.7% 106.5 108.4 109.3
New Zealand (C) 300 300 300 0.0% 0.0% 68.7 68.0 67.3
(A) Dairy years ending March of the following year. (B) Including cream. (C) Including milk drinks and fermented products.
(D) Including buttermilk. (E) Including chocolate milk and eggnog. (F) Dairy years ending June of the following year.
226 226
Table 26. Butter consumption

2010 2011 2012 growth CAGR 2010 2011 2012
Country '11-'12 '10-'12
Asia
India (A) (B) 4 170 4 320 4 510 + 4.4% + 4.0% 3.5 3.5 3.6
Pakistan (B) 649 669 669 0.0% + 1.5% 3.7 3.8 3.8
China 70 92 101 + 9.5% + 19.5% 0.1 0.1 0.1
Japan (A) 84 79 79 0.0% - 3.0% 0.7 0.6 0.6
Turkey 45 45 56 + 24.7% + 11.4% 0.6 0.6 0.7
Iran 22 23 21 - 6.2% - 2.7% 0.3 0.3 0.3
Kazakhstan 18 22 18 - 16.7% + 0.2% 1.1 1.3 1.1
Korea, Republic of 9 10 10 + 6.1% + 6.9% 0.2 0.2 0.2
Israel 6 7 7 - 2.7% + 6.1% 0.8 0.9 0.9
Mongolia 1 1 2 + 44.7% + 43.5% 0.3 0.4 0.6
EU 27 1 787 1 822 1 838 + 0.9% + 1.4% 3.6 3.6 3.7

Germany 469 492 498 + 1.2% + 3.1% 5.7 6.1 6.2
France 478 484 469 - 3.1% - 0.9% 7.6 7.6 7.4
United Kingdom 199 194 211 + 8.5% + 3.0% 3.2 3.1 3.4
Poland 161 162 155 - 4.0% - 1.7% 4.2 4.2 4.1
Italy 142 138 138 + 0.3% - 1.3% 2.3 2.3 2.3
Czech Republic 52 52 56 + 8.3% + 4.1% 4.9 4.9 5.2
Netherlands 50 55 55 0.0% + 5.2% 3.0 3.3 3.3
Austria 43 42 42 + 0.2% - 0.8% 5.1 5.0 5.0
Belgium 26 26 28 + 7.7% + 3.8% 2.4 2.4 2.5
Spain 23 25 26 + 4.0% + 6.3% 0.5 0.5 0.6
Finland 18 22 24 + 9.0% + 14.8% 3.4 4.1 4.5
Portugal 18 19 19 0.0% + 2.7% 1.7 1.8 1.8
Sweden 15 16 17 + 10.3% + 5.7% 1.6 1.7 1.8
Slovakia 14 14 16 + 11.6% + 5.3% 2.6 2.6 2.9
Ireland (C) 11 11 11 0.0% 0.0% 2.4 2.4 2.4
Hungary (C) 10 9 10 + 11.1% - 1.0% 1.0 0.9 1.0
Denmark 10 10 10 + 1.0% + 0.5% 1.8 1.8 1.8
Lithuania 7 7 9 + 26.8% + 16.8% 2.0 2.2 2.8
Latvia 5 6 6 0.0% + 4.6% 2.5 2.8 2.8
Estonia 6 5 5 0.0% - 2.7% 4.3 4.1 4.1
Luxembourg 3 3 3 + 2.9% + 3.9% 5.8 6.0 6.1
Cyprus 1 2 2 0.0% + 5.9% 1.8 1.9 1.9
Other 28 29 28 - 2.8% + 0.2% 0.6 0.7 0.7

United States of America 693 764 788 + 3.2% + 6.6% 2.2 2.5 2.5
Canada 92 97 99 + 1.9% + 3.7% 2.7 2.8 2.8
Mexico 38 31 39 + 24.7% + 1.2% 0.3 0.3 0.3
Other Europe
Russia 338 349 404 + 15.5% + 9.2% 2.4 2.4 2.8
Ukraine 84 80 96 + 20.7% + 6.6% 1.8 1.7 2.1
Switzerland 43 42 42 - 1.5% - 1.8% 5.6 5.4 5.2
Norway 12 12 16 + 34.2% + 16.8% 2.4 2.4 3.2
Croatia 4 3 4 + 61.0% - 1.1% 1.0 0.6 1.0
Iceland 2 2 2 + 6.7% + 3.3% 4.7 4.7 4.9
227 227
Table 26. Butter consumption (continued)

2010 2011 2012 growth CAGR 2010 2011 2012
Country '11-'12 '10-'12
South America
Brazil 75 78 88 + 12.8% + 8.3% 0.4 0.4 0.4
Argentina 56 57 57 0.0% + 1.6% 1.4 1.4 1.4
Chile 20 18 21 + 17.5% + 3.1% 1.2 1.0 1.2
Colombia 6 6 7 + 4.0% + 6.0% 0.1 0.1 0.1
Uruguay 5 5 5 + 5.6% + 0.1% 1.6 1.5 1.6
Oceania
Australia (D) 87 90 92 + 2.2% + 2.6% 3.9 4.0 4.0
New Zealand 20 20 21 + 5.0% + 2.5% 4.6 4.5 4.7
Africa
Egypt 60 62 59 - 5.1% - 0.8% 0.8 0.8 0.7
South Africa 13 14 14 0.0% + 3.8% 0.3 0.3 0.3
(A) Dairy years ending March of the following year. (B) Including ghee. (C) Excluding industrial use.
(D) Dairy years ending June of the following year.
228 228
Table 27. Cheese consumption

2010 2011 2012 growth CAGR 2010 2011 2012
Country '11-'12 '10-'12
EU 27 8 603 8 653 8 649 - 0.0% + 0.3% 17.2 17.3 17.2

Germany 1 919 1 947 1 952 + 0.3% + 0.9% 23.5 24.2 24.3
France 1 674 1 665 1 664 - 0.1% - 0.3% 26.6 26.3 26.2
Italy 1 279 1 327 1 274 - 3.9% - 0.2% 21.1 21.8 20.9
United Kingdom 699 685 703 + 2.6% + 0.2% 11.3 11.0 11.2
Spain 436 440 436 - 0.8% + 0.0% 9.5 9.5 9.3
Poland 430 434 434 + 0.0% + 0.5% 11.3 11.4 11.4
Netherlands 324 324 324 0.0% 0.0% 19.5 19.4 19.4
Sweden 177 180 187 + 4.3% + 2.9% 18.9 19.0 19.7
Czech Republic 174 172 177 + 3.3% + 1.0% 16.5 16.2 16.6
Belgium 172 168 170 + 1.0% - 0.7% 16.0 15.3 15.3
Austria 153 159 164 + 2.6% + 3.3% 18.2 19.0 19.2
Finland 115 121 128 + 5.4% + 5.3% 21.4 22.5 23.7
Hungary 115 110 114 + 3.6% - 0.3% 11.5 11.0 11.5
Portugal 101 102 102 0.0% + 0.5% 9.5 9.6 9.6
Slovakia 54 56 55 - 1.9% + 0.7% 10.0 10.3 10.1
Lithuania 46 46 52 + 14.7% + 6.5% 13.9 14.2 16.3
Latvia 30 30 33 + 11.5% + 4.7% 14.4 14.3 16.0
Ireland 33 31 31 0.0% - 3.1% 7.3 6.7 6.7
Estonia 26 27 27 0.0% + 2.9% 19.6 20.8 20.8
Cyprus 18 15 15 0.0% - 7.4% 21.6 18.1 18.1
Luxembourg 13 12 13 + 2.3% - 2.4% 26.4 24.2 24.4
Other 615 602 593 - 1.5% - 1.8% 12.7 12.5 12.3

United States of America 4 635 4 718 4 774 + 1.2% + 1.5% 15.0 15.1 15.2
Canada 428 419 422 + 0.6% - 0.7% 12.6 12.2 12.1
Mexico 311 354 356 + 0.6% + 7.0% 2.8 3.1 3.1
Asia
Turkey 452 494 536 + 8.4% + 8.8% 6.2 6.7 7.2
Iran 360 360 372 + 3.3% + 1.7% 4.8 4.6 4.7
Japan (A) 245 267 267 0.0% + 4.4% 1.9 2.1 2.1
Israel 129 132 135 + 2.3% + 2.3% 17.0 16.7 17.1
Korea, Republic of 89 100 99 - 1.0% + 5.5% 1.8 2.0 2.0
China 39 49 68 + 41.0% + 32.1% 0.0 0.0 0.1
Kazakhstan 35 39 41 + 5.1% + 8.4% 2.2 2.4 2.5
Mongolia 0 0 1 + 98.3% + 44.5% 0.1 0.1 0.3
Other Europe
Russia 834 831 952 + 14.5% + 6.8% 5.9 5.8 6.6
Ukraine 217 186 194 + 3.9% - 5.6% 4.7 4.1 4.2
Switzerland 172 172 168 - 2.1% - 1.0% 22.0 21.8 21.1
Norway 85 87 89 + 1.8% + 2.1% 17.3 17.4 17.7
Croatia 38 34 41 + 21.7% + 3.6% 8.7 7.7 9.6
Iceland 8 8 8 + 5.1% + 3.2% 24.2 24.2 25.2
229 229
Table 27. Cheese consumption (continued)

2010 2011 2012 growth CAGR 2010 2011 2012
Country '11-'12 '10-'12
South America
Brazil 666 715 725 + 1.4% + 4.3% 3.4 3.6 3.6
Argentina 454 458 458 0.0% + 0.4% 11.2 11.3 11.2
Chile 110 124 141 + 13.8% + 13.3% 6.4 7.2 8.1
Colombia 41 43 45 + 4.0% + 4.2% 0.9 0.9 0.9
Uruguay 22 21 21 - 3.9% - 2.9% 6.4 6.3 6.0
Africa
Egypt 684 835 759 - 9.1% + 5.3% 8.8 10.5 9.4
South Africa 50 52 79 + 51.2% + 25.8% 1.0 1.0 1.5
Oceania
Australia (B) 269 266 271 + 1.5% + 0.3% 12.0 11.7 11.8
New Zealand 24 30 30 0.0% + 11.8% 5.5 6.8 6.7
(A) Dairy years ending March of the following year. (B) Dairy years ending June of the following year.
230 230
Table 28. Average producer milk prices
2010 2011 2012 2012 2012

Country Currency Milk price/100 kg USD/100 kg EUR/100 kg
Africa
Egypt EGP 260.92 298.54 315.53 52.10 40.55
South Africa ZAR 289.32 282.25 334.43 40.78 31.70
Zimbabwe USD 53.40 53.40 53.40 53.40 41.56
Asia
China CNY 335.00 349.00 361.00 57.22 44.54
India (A) INR 1 693.00 1 961.00 2 053.00 38.46 29.93
Iran IRR 430 675.56 820 000.00 960 000.00 78.85 61.37
Israel ILS 183.02 204.48 208.33 54.03 42.06
Japan JPY 8 820.00 8 930.00 9 030.00 113.13 88.11
Korea, Republic of KRW 80 495.00 86 668.93 95 190.00 84.53 65.75
Mongolia MNT 77 669.90 72 815.53 - - -
Turkey TRY 73.59 68.80 80.03 44.56 34.59
EU 27 (B) EUR 30.58 33.99 32.67 41.97 32.67

Austria EUR 31.70 35.40 33.89 43.54 33.89
Belgium EUR 30.50 33.54 29.23 37.56 29.23
Cyprus EUR 51.45 52.48 52.69 67.70 52.69
Czech Republic CZK 720.39 801.94 744.66 38.04 29.61
Denmark DKK 249.00 269.00 263.00 45.41 35.33
Estonia EUR 27.71 32.30 30.00 38.54 30.00
Finland EUR 35.78 39.32 42.13 54.13 42.13
France EUR 29.17 31.71 30.56 39.26 30.56
Germany EUR 30.83 34.83 31.99 41.10 31.99
Hungary HUF 7 115.00 8 596.00 8 630.00 38.34 29.84
Ireland EUR 29.90 34.47 32.75 42.08 32.75
Italy EUR 34.17 38.45 36.97 47.50 36.97
Latvia LVL 17.78 20.71 19.08 34.89 27.36
Lithuania LTL 86.41 98.54 89.72 33.40 25.98
Luxembourg EUR 29.08 32.00 30.28 38.91 30.28
Netherlands EUR 33.72 38.78 36.13 46.42 36.13
Poland PLN 103.40 117.67 116.20 35.68 27.77
Portugal EUR 28.98 31.42 32.00 41.11 32.00
Slovakia EUR 27.24 31.62 29.46 37.85 29.46
Spain EUR 30.21 31.86 31.26 40.17 31.26
Sweden SEK 335.00 348.00 327.00 48.29 37.57
United Kingdom GBP 23.93 26.55 27.22 43.15 33.57

Canada CAD 72.11 74.22 73.43 73.46 57.18
Mexico MXN 446.60 467.96 524.27 39.86 31.02
United States of America USD 35.94 44.31 40.79 40.79 31.75
Oceania
Australia (C) AUD 41.94 39.42 37.48 38.82 30.21
New Zealand NZD 70.74 73.00 57.20 46.36 36.05
231 231
Table 28. Average producer milk prices (continued)
2010 2011 2012 2012 2012

Country Currency Milk price/100 kg USD/100 kg EUR/100 kg
Other Europe
Belarus BYR 85 400.00 154 500.00 287 600.00 34.50 26.85
Croatia HRK 208.51 248.71 245.89 42.03 32.69
Iceland ISK 6 905.83 7 536.89 7 808.74 62.43 48.58
Norway NOK 426.21 460.19 464.15 79.78 62.09
Russia RUB 1 318.25 1 581.40 1 556.80 50.48 39.29
Switzerland CHF 61.79 62.67 60.46 62.43 50.16
Ukraine UAH 293.87 304.16 266.28 33.32 25.94
South America
Argentina ARS 125.83 146.21 159.03 35.05 27.28
Brazil BRL 68.36 80.58 83.65 42.82 33.35
Chile CLP 16 851.46 18 169.90 18 877.86 38.81 30.20
Colombia COP 87 378.64 106 796.12 89 805.83 49.98 38.90
Uruguay UYU 622.65 768.28 740.63 36.47 28.38
(A) Dairy years ending March of the following year. Mixed (cow and buffalo) milk, refers to cooperative dairies only.
(B) Weighted average (source: European Commission). (C) Dairy years ending June of the following year.
232 232
Table 29. Butter prices in selected countries
2010 2011 2012 2010 2011 2012

Country USD/tonne EUR/tonne
Africa
Egypt - 4 214 4 458 - 3 027 3 470
Asia
India (A) 5 447 5 879 5 489 4 120 4 267 4 264
Iran 5 500 11 303 11 909 4 078 8 120 9 269
Israel 4 417 6 121 5 816 3 332 4 397 4 527
Japan (A) 12 317 14 125 14 527 9 317 10 253 11 285
Korea, Republic of 5 673 6 618 7 038 4 279 4 755 5 478
Mongolia 8 548 9 166 8 545 6 448 6 585 6 651
Turkey - 10 765 9 774 - 7 734 7 608
EU 27
Belgium (B) 4 846 4 652 4 040 3 626 3 595 3 062
Czech Republic (C) 4 389 5 321 5 054 3 320 4 037 3 852
Estonia 3 642 5 304 4 330 2 747 3 810 3 370
France 4 242 5 369 4 084 3 200 3 857 3 179
Germany 4 587 5 526 3 957 3 460 3 970 3 080
Hungary 5 573 6 492 5 971 4 204 4 664 4 647
Italy 4 229 5 039 3 533 3 190 3 620 2 750
Latvia 4 076 6 090 5 412 3 075 4 375 4 212
Lithuania 4 323 5 520 4 575 3 261 3 966 3 561
Netherlands 4 594 5 490 3 866 3 465 3 944 3 009
Poland 4 261 5 050 3 984 3 214 3 628 3 101
Portugal (D) 4 761 4 349 4 462 3 563 3 362 3 382
Slovakia 4 648 5 593 4 664 3 506 4 018 3 630
Spain 3 748 4 776 3 488 2 827 3 431 2 715
United Kingdom 4 713 5 473 4 011 3 555 3 932 3 122

United States of America 3 756 4 296 3 515 2 833 3 086 2 736
Oceania
New Zealand 4 050 4 620 2 764 3 055 3 319 2 152
Other Europe
Croatia 4 753 5 116 5 099 3 586 3 675 3 969
Iceland 4 216 5 019 4 836 3 181 3 605 3 764
Norway 5 631 6 073 6 359 4 248 4 363 4 950
Russia 4 901 5 805 - 3 697 4 170 -
Ukraine 4 618 4 093 - 3 483 2 940 -
South America
Argentina 3 447 3 625 3 569 2 600 2 604 2 778
Brazil 5 650 - - 4 262 - -
Colombia 3 381 3 788 4 051 2 551 2 721 3 153
Uruguay 3 581 4 534 3 475 2 701 3 257 2 705
World market price (E) 4 061 4 491 3 315 3 063 3 226 2 580
(A) Fiscal year, ending March of the following year. (B) 31st December of each year.
(C) December of each year. (D) Last week of each year. (E) Oceania export prices (f.o.b. port).
233 233
Table 30. Cheese prices in selected countries
2010 2011 2012 2010 2011 2012

Country USD/tonne Cheese type (A) EUR/tonne
Africa
Egypt - 3 708 4 128 Domiaty - 2 664 3 213
Asia
Iran 3 044 7 536 9 035 Feta type 2 257 5 413 7 032
Israel 8 189 8 826 8 448 Edam type 6 177 6 340 6 575
Korea, Republic of 9 842 10 914 11 513 Cheddar 7 424 7 840 8 961
Mongolia 8 106 8 692 8 103 Not specified 6 114 6 244 6 307
Turkey - 6 806 6 942 Not specified - 4 889 5 403
EU 27
Belgium (B) 4 476 4 406 4 209 Cheddar 3 350 3 405 3 190
Cyprus 8 100 8 644 8 017 Halloumi 6 110 6 210 6 240
Czech Republic (C) 4 392 4 523 5 112 Edam 3 322 3 432 3 896
Estonia 4 739 4 691 4 240 Edam 3 575 3 370 3 300
Germany 3 898 4 538 3 867 Gouda 2 940 3 260 3 010
Hungary 4 731 5 421 4 565 Trappist 3 568 3 894 3 553
Italy 9 598 12 319 11 512 Grana Padano 7 240 8 850 8 960
Latvia 3 794 4 158 3 902 Tilsit 2 862 2 987 3 037
Lithuania 4 248 4 825 4 286 Not specified 3 204 3 466 3 336
Poland 4 016 4 578 4 215 Edam 3 029 3 289 3 281
Portugal (D) 8 498 8 246 8 406 Flamengo 6 360 6 373 6 371
Slovakia 5 189 5 785 5 340 Edam 3 914 4 156 4 156
Spain - 9 800 9 096 Not specified - 7 040 7 080
United Kingdom 4 205 4 685 4 605 Cheddar 3 172 3 365 3 584

United States of America 3 357 4 024 3 766 Cheddar 2 532 2 891 2 931
Oceania
New Zealand 4 010 4 374 3 176 Cheddar 3 025 3 142 2 472
Other Europe
Croatia 7 042 7 578 5 481 Edam 5 312 5 444 4 266
Iceland 8 158 9 218 8 889 Gouda 6 153 6 622 6 918
Norway 9 441 10 181 10 141 Norvegia 7 121 7 314 7 893
Russia 5 781 6 313 - Not specified 4 360 4 535 -
Ukraine 4 978 5 597 - Not specified 3 755 4 021 -
South America
Argentina 4 394 4 727 5 024 Not specified 3 314 3 396 3 910
Brazil 5 513 - - Muarela 4 159 - -
Chile - 11 274 11 265 Not specified - 8 099 8 768
Colombia 4 473 4 916 5 259 Not specified 3 374 3 532 4 093
Uruguay 4 781 5 439 5 601 Not specified 3 606 3 907 4 359
World market price (E) 4 012 4 408 3 825 Cheddar 3 026 3 167 2 977
(A) Not specified: the cheese price can not be linked to a specific cheese type or no information is available.
(B) 31st December of each year. (C) December of each year. (D) Last week of each year. (E) Oceania export prices (f.o.b. port).
234 234
Table 31. Whole milk powder prices in selected countries
2010 2011 2012 2010 2011 2012

Africa
Egypt - 4 045 3 633 - 2 906 2 827
Asia
China 4 285 4 642 4 438 3 233 3 335 3 455
Iran - 7 347 6 571 - 5 278 5 114
Japan (A) 9 977 10 847 10 603 7 547 7 873 8 237
Mongolia 5 895 6 717 6 261 4 447 4 825 4 873
Pakistan (B) 2 176 2 550 - 1 642 1 832 -
Turkey - 4 228 4 043 - 3 037 3 147
EU 27
Belgium (C) 3 872 3 792 3 667 2 898 2 931 2 779
Estonia 3 728 - - 2 812 - -
France 3 601 4 375 3 543 2 716 3 143 2 758
Germany 3 560 4 285 3 524 2 685 3 078 2 743
Latvia 3 334 3 922 3 403 2 515 2 817 2 649
Lithuania 3 053 4 467 3 344 2 303 3 209 2 603
Netherlands 3 560 4 179 3 474 2 685 3 003 2 704
Poland 3 521 4 071 3 503 2 656 2 924 2 727
Portugal (D) 3 990 3 964 2 655 2 986 3 063 2 013
Slovakia 4 051 4 560 4 116 3 055 3 276 3 203

Oceania
New Zealand 3 455 4 054 2 824 2 607 2 913 2 198
Other Europe
Croatia 4 225 4 547 - 3 187 3 267 -
Iceland 9 580 10 934 10 543 7 226 7 855 8 206
Norway 5 962 6 787 6 875 4 498 4 876 5 351
Russia 4 133 4 415 - 3 117 3 172 -
Ukraine 3 605 3 624 - 2 719 2 603 -
South America
Argentina 3 899 4 112 4 095 2 941 2 954 3 187
Brazil 6 127 - - 4 622 - -
Chile - 7 921 8 331 - 5 690 6 485
Colombia 8 625 9 036 9 183 6 506 6 491 7 147
Uruguay 3 332 4 146 3 475 2 514 2 978 2 705
(A) Fiscal year, ending March of the following year. (B) Fiscal year, ending June of the following year. (C) 31st December of each year.
(D) Last week of each year. (E) Oceania export prices (f.o.b. port).
235 235
Table 32. Skim milk powder prices in selected countries
2010 2011 2012 2010 2011 2012

Africa
Egypt - 3 540 3 302 - 2 543 2 570
Asia
China 4 138 4 487 4 280 3 121 3 224 3 331
India (A) 3 504 4 057 3 141 2 651 2 945 2 440
Iran 3 800 7 536 6 735 2 817 5 413 5 242
Israel 5 296 5 593 5 302 3 995 4 018 4 127
Japan (A) 6 845 7 575 7 475 5 178 5 498 5 807
Turkey - 3 692 3 407 - 2 652 2 652
EU 27
Belgium (B) 3 028 3 076 3 181 2 266 2 377 2 411
Czech Republic (C) 2 832 3 027 3 296 2 142 2 297 2 512
Estonia 2 934 - - 2 213 - -
France 2 893 3 390 3 045 2 182 2 435 2 370
Germany 2 918 3 363 3 024 2 201 2 416 2 354
Latvia 2 896 3 488 2 895 2 184 2 506 2 253
Lithuania 2 717 3 178 2 832 2 050 2 283 2 204
Netherlands 2 883 3 325 3 000 2 175 2 389 2 335
Poland 2 801 3 149 2 901 2 113 2 263 2 258
Portugal (D) 3 160 3 849 3 280 2 365 2 974 2 486
Slovakia 2 961 3 417 3 037 2 234 2 455 2 364
United Kingdom 2 932 3 442 3 195 2 212 2 472 2 487
Northern America
Oceania
New Zealand 3 104 3 784 2 738 2 342 2 718 2 131
Other Europe
Croatia 4 049 4 360 - 3 054 3 132 -
Iceland 5 134 6 097 5 875 3 873 4 380 4 573
Norway 5 797 6 609 6 703 4 373 4 748 5 217
Russia 3 546 3 808 - 2 675 2 736 -
Ukraine 2 955 3 005 2 229 2 159 -
South America
Argentina 4 792 5 214 5 325 3 614 3 746 4 145
Chile - 7 717 8 116 - 5 543 6 317
Uruguay 2 888 3 709 3 445 2 178 2 664 2 681
(A) Fiscal year, ending March of the following year. (B) 31st December of each year.
(C) December of each year. (D) Last week of each year. (E) Oceania export prices (f.o.b. port).
236 236
Abbreviations and Conventional Signs

ALIC Agriculture and Livestock Industry Corporation (Japan)
Bln Billion
BRIC Brazil, Russia, India, China
CAGR Compound Annual Growth Rate
CAP Common Agricultural Policy
CEEC Central and Eastern European Countries
CNIEL Centre National Interprofessionnel de l'Economie Laitire (French Dairy Inter-branch Organization)
Cwt Centum weight or hundredweight: in the US defined as 100 lb, equal to about 45.36 kg
DCANZ Dairy Companies Association of New Zealand
DNB De Nederlandsche Bank
DPMPP Dairy Producer Margin Protection Program
ECLAC Economic Commission for Latin America and Caribbean
ECM Energy Corrected Milk
EFTA European Free Trade Association
EU European Union
EUROSTAT Statistical Office of the European Union
F Fat
FADN Farm Accountancy Data Network
FAO Food and Agriculture Organization of the United Nations
FAPRI Food and Agricultural Policy Research Institute
FED Federal Reserve: the central bank of the United States of America
FEPALE Pan-American Dairy Federation
FOB Free On Board
FTA Free-Trade Agreement
FY Fiscal Year
GATT General Agreement on Tariffs and Trade
GDP Gross domestic product
GDT Global Dairy Trade auction platform
GMO Genetically modified organisms
IDF International Dairy Federation
IFCN International Farm Comparison Network
IOFC Income over Feed Costs
kg Kilogram
LAC Latin American and Caribbean
LGM-Dairy Livestock Gross Margin Insurance for Dairy Cattle
LIC Livestock Improvement Corporation
LTO Land- en Tuinbouworganisatie (Dutch Federation of Agriculture and Horticulture)
meq Milk equivalent
Mln Million
OECD Organisation for Economic Co-operation and Development
P Protein
PDO Protected Designation of Origin
PPP Purchasing Power Parity
PRB Population Reference Bureau
PZ Productschap Zuivel (Dutch Dairy Board)
SIAP Servicio de Informacin Agroalimentaria y Pesquera (Mexico)
SMP Skim milk powder
TPP Trans-Pacific Partnership
UAE United Arab Emirates
USDA United States Department of Agriculture
UN United Nations
WMP Whole milk powder (in this report basically includes all milk powder with fat content>1.5%)
WTO World Trade Organization
Yr year
ZMB Zentrale Milchmark Berichterstattung GmBH
- No figure available or no sense to give numeric figure
237 237
WORLD DAIRY SITUATION 2013
Abstract
Annual survey presented at IDF World Dairy Summit, Yokohama (Japan), in October/November 2013.
Production, consumption, trade and price figures from dairy sector and other sources. Largest dairy
companies by turnover and/or milk intake. Comments and prognoses on the situation in different
countries and analysis of the whole, covering all major producing and consuming countries. Review of
various forecasts of dairy trade.
Keywords: dairy economics, milk production, consumption trends, dairy situation, dairy markets, world
trade, dairy prices, dairy trade projections.
237 pp - English only
Bulletin of IDF N 470/2013 Price: 95 Euro (electronic) Date 2013
238
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Bulletin of the International Dairy Federation 470/2013

The World Dairy Situation 2013

Abbreviations and Conventional Signs . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 237

World Dairy Situation 2013

continues to have a strong

Paterson Sarah Paterson Nico van Belzen Nico van B

Sarah Paterson Nico van Belzen

Message from the WDS Team

On behalf of the WDS team

A Word from our Partners

Saputo recognizes the ever-changing expectations

WORLD DAIRY SITUATION AT A GLANCE 2012

(A) In 50 selected countries

110 7 200 Asia 92% 93%

WORLD DAIRY TRADE

World: dairy product prices World: producer prices for milk

Cows milk production annual growth in 2012

Ranking of the main producers

Source: CNIEL, PZ, FAO, IDF National Committees.

1.3. Buffalo milk

Buffalo milk production - Geographical breakdown in 2012

World: 101 mln tonnes

Source: CNIEL, PZ, FAO, IDF National Committees.

1.4. Milk from sheep, goats and other animals

mln tonnes Goat

Source: CNIEL, PZ, FAO, IDF National Committees.

1.5.1. Official figures for the first half of 2013

Trend in milk production (or deliveries) in 2013

Production or 2013 Growth

Argentina (C) D Jan-Mar 1.7 -9.6%

Source: CNIEL, ZMB, USDA, DCANZ, ALIC.

Milk production development (12 months rolling)

mln tonnes mln tonnes

mln tonnes mln tonnes

Source: CNIEL, PZ, national statistics, international press.

Comparison of FAO and USDA forecasts for milk production in 2013

India (D) + 4.0 + 4.1

Australia (E) - 1.7 - 0.5

2.1. Cows milk deliveries

Cows milk delivery development in 2012

Global development 2000-2012 (A)

Main countries and areas (B) < 0% 1 to 3%

Source: CNIEL, PZ, FAO, USDA, IDF National Committees.

2.2. General overview of dairy product output

Dairy product output development in selected countries (C)

mln tonnes mln tonnes mln tonnes Cow's milk cheese

mln tonnes WMP mln tonnes SMP

Source: CNIEL, PZ, FAO, IDF National Committees, USDA.

2.2.1. Liquid milk and fresh dairy products

Liquid milk and fermented products - output development in selected countries

Liquid milk (D) Fermented products (F)

Source: CNIEL, PZ, Eurostat, IDF National Committees, ZMB.

2.2.2. Butter and other milk fats

Butter and butteroil output development

Global development 2000-2012 for the two main players

Source: CNIEL, PZ, FAO, USDA, IDF National Committees, ZMB.

2.2.3. Industrial cheese