A decade of new opportunities awaits the dairy sector

Global consumption of milk solids on a per capita basis is forecast to increase by 1.9% per annum up to 2035. Meanwhile, a continuing growth in the world’s population is also expected during the next 10 years.

Considered collectively, these factors point to a significant strengthening of global demand for milk and dairy products.

Most of this increase in demand will be centred on fresh locally consumed dairy products in countries like India and Pakistan, which will account for 72% of total milk solids consumption by 2035. The remaining 28% of consumed solids will be in the form of processed dairy products.

However, there is also an expectation that strong growth in exports of processed dairy products will feature strongly in the evolving international dairy landscape over the coming years.

These projections are outlined in the recently published OECD: FAO Agricultural Outlook 2026-2035 and carry a significant degree of credibility.

The Organisation for Economic Co-operation and Development (OECD) is an international organisation of 38 member countries, dedicated to promoting economic growth, trade, and higher living standards worldwide, while the Food and Agriculture Organisation (FAO) is a specialised agency of the United Nations focused on advancing food security and sustainable agricultural development.

We already know that dairy products are highly valued by consumers as an important component of a healthy, balanced and nutritious diet. As incomes rise and populations grow, global consumption of dairy products is expected to increase over the medium term.

Asia, particularly India and Pakistan, will continue to have the strongest growth in consumption of fresh dairy products. In addition, further increases in consumption of processed dairy products are expected in Europe and North America where cheese consumption is already high.

Only 7% of global milk output is currently traded across international borders: a figure that is likely to expand by 11% on the baseline volume to reach 13.7 million tonnes by 2035. And the good news is that Northern Ireland is ideally placed to capitalise on these trends and help shape the next phase of growth in global dairy trade.

Currently, the United States, the European Union, the United Kingdom and New Zealand, combined, account for nearly 70% of global dairy exports.

2025 saw global milk production surpass the one billion tonne mark. There is every indication that this figure will continue to rise, exceeding1.2 billion tonnes by 2035.

This growth will be driven by increasing international demand for dairy products.

However, future market opportunities within the dairy sector will not be determined by volume alone. Market demand will increasingly shape the products that deliver the greatest value. According to the latest OECD: FAO analysis the price gap between milk fat and non-milk fat solids is expected to persist over the next 10 years, reflecting stronger global demand for milk fat. This trend is likely to influence processing priorities and investment decisions across the industry.

At the same time, improving the sustainability of local milk production will remain a central priority for the sector as it seeks to meet growing demand while reducing its environmental impact.

The Dairy Council for Northern Ireland is firmly on the record that this objective can be secured alongside increased milk output.

In recent years, significant investment has been made at both processor and farm level to enhance sustainability across Northern Ireland’s dairy sector. This commitment is expected to continue as the industry progresses towards its sustainability objectives.

So, yes, milk output can continue to grow. But this does not necessarily require an increase in dairy cow numbers. Advances in genetics and other technologies can raise milk yields per cow, enabling the sector to increase production while reducing its environmental footprint.

Managing slurries and surplus nutrients in the production system more effectively will be an absolute priority for the future. But there is already clear evidence that utilising new technologies can deliver value-added solutions where this issue is concerned.

Obviously, it is imperative that our processors are enabled to capitalise on the enhanced export opportunities for dairy products that will present themselves over the coming years.

But here, again, a good news story is fast-evolving. Local processors already have a foothold in regions such as Sub-Saharan Africa, South-East Asia, Near East and North Africa where growth in dairy consumption is projected to outpace production.

Underpinning all of this will be a requirement to continually add value to the dairy products we produce here in Northern Ireland. Premiumisation is an ongoing process of investment, product development and market penetration.

Processing remains a cornerstone of our dairy industry. Increasing sectoral revenue will depend on producing more dairy solids at farm level.

Looking ahead, the focus will be on the continued adoption of sustainable practices and innovative solutions. This approach will support the production of higher milk solids per litre of milk while ensuring that efficiency is maximised across the sector.

The dairy industry is a key driver of Northern Ireland’s economy. As it looks to the future, the priority will be very much that of securing more value from every litre of milk produced on farm.

Catering for uncertainties and risk will be crucial to the future planning process.

Protecting the sector against the impact of the ever-evolving animal disease threats reaching our shores is a case in point.

Bluetongue is a very live and current threat. We have also seen Avian Flu evolving in ways that have impacted dairy cattle populations in the United States.

It is not envisaged that animal diseases will constrain global production significantly.

However, they do have the potential to cause supply disruptions at specific times.

But above all else, the latest OECD: FAO report points to an international dairy sector that is primed for demand-driven, sustainable growth.

And Northern Ireland’s dairy industry can be a key player in this regard.

Future demand will be driven by a consuming public around the world that fully recognises the role that dairy-based foods can play at the heart of a healthy nutritious diet, provided they are produced on a sustainable basis.

So, the onus is on the dairy industry here in Northern Ireland to respond accordingly.