China’s Dairy Imports Fall More Than a Third in Five Years

Summary

China's imports of milk and dairy products fell by more than a third by weight between 2021 and 2025, according to independent research cited by Russia's Agroexport Development Centre. Volumes dropped from 3.7 million tonnes in 2021 to 2.4 million tonnes in 2025, a decline of 35.1 percent. In value terms, imports fell from USD 9.2 billion to USD 7.7 billion, down 16.3 percent.

China remains a major global milk importer, but imports have trended lower since 2022 amid continued development of domestic production and a gradually saturating market, reflecting rising domestic dairy capacity and a stabilising consumption mix. New Zealand dominated supply in 2025, accounting for 62.7 percent of China's total dairy import value, with Australia, Germany, France and the Netherlands sharing the remainder. The research did not disclose country-specific shares.

Analysts say the decline reflects larger-scale domestic pasture operations and greater self-sufficiency in raw milk, as well as slower consumption growth and inventory adjustments in some categories. Despite the overall contraction, demand for high-quality whey powder, infant formula and specific cheese products persists, with the import mix shifting from volume expansion to quality optimisation.

Commentary

The more than one-third decline in China's dairy imports over five years puts direct pressure on New Zealand dairy exporters. Fonterra, the country's largest co-operative, derives about 25 percent of its global revenue from Greater China, and with about 95 percent of New Zealand's dairy output exported, China is its largest single market. New Zealand still accounted for 62.7 percent of China's total dairy import value in 2025, but a shrinking total means lower absolute export volumes.

Notably, the fall in value (16.3 percent) was far smaller than the fall in volume (35.1 percent), pointing to higher unit prices or a shift toward higher-value products. Rising domestic raw milk self-sufficiency and slower consumption growth in China are long-term trends, but demand for infant formula, whey powder and specific cheeses remains. New Zealand small and medium-sized enterprises should accelerate the shift from bulk commodity exports to functional, differentiated products, and leverage tariff advantages under the upgraded China-New Zealand free trade agreement to deepen niche channels in second- and third-tier cities.

At the same time, Australian dairy products are regaining growth in China, intensifying competition, and New Zealand firms need to build barriers in areas of strength such as organic grass-fed and sustainable certification.

Keywords: dairy imports, China, New Zealand, import decline, raw milk self-sufficiency, infant formula, whey powder, Agroexport Development Centre

Source: Tencent