Global dairy quarterly Q2 2025: Too good to be true?

Trade uncertainty, driven by policy changes from Washington, DC, continue to disrupt global dairy trade. The US/China tariff escalation was paused on May 12, with China’s retaliatory tariff dropping from 125% to 10%. The cool-off period is for 90 days, with further tariff changes possible thereafter. Key US dairy exports to China include dry whey, whey permeate, whey proteins, and lactose.

In China, prices for WPI, WPC and lactose fell immediately after the May 12th announcement. Any US/China trade policy shifts and tariff escalations create uncertainty for dairy and food processors, and ingredient suppliers. The market volatility makes long-term sourcing and pricing strategy more difficult.

Animal diseases continue to pose a major threat to the EU dairy industry. Recent foot-and-mouth disease (FMD) outbreaks in Central Europe disrupted milk production and exports, though no new cases have been reported since early May. Additionally, the bluetongue virus (BTV) significantly affected milk supply in 2024, with ongoing impacts in 2025.