RaboResearch: Entire dairy chain feeling pressure
- ZISK
- Apr 13
- 1 min read
WASHINGTON — According to a new report from Rabobank, participants all along the dairy value chain are being squeezed. Producers’ milk prices have tumbled from 2022’s lofty levels while feed prices are at record highs. Processors and dairy cooperatives entered the year discounting expensive inventory made with high-priced milk. Meanwhile, higher inflation and rising interest rates are pressuring consumers toward more frugal purchasing behaviour.
Greater year-on-year milk production growth has emerged in 2023 in the key export regions, compared to 2022’s low levels. At the same time, farmgate milk prices are catching up to global commodity market trends and have moved lower. Expensive input costs remain a clear headwind worldwide and, combined with lower milk prices, are resulting in farm-level margin pressure. In response, dairy cow slaughter rates have escalated.
“Milk production from the Big 7 export regions is anticipated to grow by 0.7% year-on-year in 2023, following 2022’s decline of 0.9%,” says Mary Ledman, Global Sector Strategist for Dairy at Rabobank. “Rabobank downgraded its 2023 forecast from last quarter’s estimate of 1%. This slower growth is attributed to increased culling in the US and weather-related production challenges in New Zealand, Brazil, and Argentina.”
March 8, 2026
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