Global dairy protein prices rise amid increasing milk supplies

Global dairy markets are experiencing divergent trends, with protein-based products seeing price increases while milk-fat products like butter and cream face downward pressure. This shift is driven by rising raw milk availability and subdued demand from both retail and industrial sectors.

Global milk production is projected to grow by 2.2% in 2026, followed by a 1% increase in 2027. Key contributors to this supply growth include record output in New Zealand, significant gains in South America—specifically Uruguay, where output has risen 12% year to date—and resilient production in the European Union, particularly in France and Germany.

In the United States, milk output has shown steady expansion, with annual supply projected to grow by 2.2%. Much of this surplus is being directed into cheese production, supported by approximately $13 billion in national processing investments. However, broader market recovery remains limited by inflation, high interest rates, and cooling export demand.