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17.5 million fewer dairy farms by 2025

The number of dairy farms in the world is expected to fall by 17.5m by 2025, leaving a total of 121m dairy farms globally, according to the International Farm Comparison Network (IFCN).

This is just one of the many significant changes in farm numbers and sizes the IFCN expects to see within the next decade.

One of the main findings from the IFCN’s long-term outlook is that there will be fewer but larger dairy farms on a global level by 2025.

While the number of cows and milk yield on each individual farm is also expected to increase, leading to a 47{b28040870e2dde01f25bc5b483275391226143b34751c4bb8f1feeecaec925a1} increase in on-farm milk production between now and 2025.

This global milk demand represents growth of 25{b28040870e2dde01f25bc5b483275391226143b34751c4bb8f1feeecaec925a1} over 10 years or 2.3{b28040870e2dde01f25bc5b483275391226143b34751c4bb8f1feeecaec925a1} year-on-year, with the growing global population and the increase of milk consumption per capita the key driver for this demand growth.

Meanwhile, the growing population and increased consumption will lead to people consuming 127kg of dairy products per person/year in 2025, according to Torsten Hemme, Managing Director of IFCN.

“Therefore, the level of global milk supply will also keep growing, provided that the consumers still have positive preferences for milk and the political and overall economic situation is stable,” Hemme said.

A key driver for the future milk supply is undoubtedly the long-term average milk price at which the farmers are able to produce, the IFCN indicated.

It estimates this milk price level at 41$/100kg milk (Energy Corrected Milk at 4.0{b28040870e2dde01f25bc5b483275391226143b34751c4bb8f1feeecaec925a1} fat, 3.3{b28040870e2dde01f25bc5b483275391226143b34751c4bb8f1feeecaec925a1} protein); a price level that is substantially higher than the prices observed in 2015 and 2016.

With this price, the milk production is expected to increase by 208m tonnes, which represents 8.5 times the current milk production of New Zealand.

Full Story Written by Agriland

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