Milk and cream market in Sri Lanka

Earlier Report Observations

Production of milk and cream in Sri Lanka fluctuated over the period from 2018 to 2023. After a dip in 2019, output grew notably in 2020 and 2021, reaching over 610 thousand tons. This expansion was driven by development programs like the USDA-funded Market-Oriented Dairy project, which introduced better farming techniques and financial management to boost local milk yields. Additionally, rising import prices for milk products from 2021 onward made domestic production more attractive, supporting further growth.

The market has been shaped by consistent government price controls and evolving consumer preferences toward locally sourced and organic dairy items. In 2022, new food labeling and advertising regulations were enacted, with implementation starting in 2024, requiring updated packaging and traceability information. These regulatory steps, along with sustained demand for safe and high-quality milk, have influenced industry practices even as production volumes stabilized near 600 thousand tons in 2022-2023.

Production milk and cream in Sri Lanka

In kind, 2017-2020, K t

Top producers of milk and cream, 2017-2020

World map of production of milk and cream, 2017-2020

In 2019, Sri Lanka's milk and cream production experienced its largest decline of 4.6%. However, production rebounded in 2020, reaching 584.9 thousand tons, which marked a 9.8% improvement compared to 2019. Looking at the broader period from 2017 to 2020, production increased by 23.4%, translating to an annualized growth rate of 7.3%. The most significant increase occurred in 2018, with a notable rise of 17.8%.

Annual dynamics of production in Sri Lanka in kind, 2017-2020, K t

Exports milk and cream from Sri Lanka

Exports in kind, t

Sri Lanka's milk and cream export volume showed significant fluctuations during this period. In 2018, exports peaked at 26.3 tons, but then dropped sharply in 2019 to a minimum of 4.4 tons, representing the largest decline of 83.3%. By 2020, exports recovered strongly, totaling 14.5 tons, which was a steep improvement of 228.3% compared to 2019. Overall, from 2018 to 2019, the market exhibited a peak-to-trough amplitude of 6 times.

Annual dynamics of product's exports from Sri Lanka in kind, 2017-2020, t

From 2017 to 2020, Maldives was the dominant market for Sri Lanka's milk and cream exports in kind, accounting for 85.2% of total flows. Other countries together made up the remaining share.

Structure of product's exports in kind by countries, 2017-2020

World map of product's exports from Sri Lanka in kind, 2017-2020

Exports in value, K $ US

The market for milk and cream exports in value terms displayed an unstable trend throughout the timeframe. In 2018, exports reached a maximum of 54 thousand US dollars, but then fell to a minimum of 20 thousand US dollars in 2019, showing the largest decline of 62.2%. By 2020, exports rebounded to 35 thousand US dollars, equivalent to a sharp increase of 70.5% over the previous year. The period recorded a peak-to-trough amplitude of 2.6 times.

Annual dynamics of product's exports from Sri Lanka in value, 2017-2020, K $ US

Over the period from 2017 to 2020, Maldives was the dominant buyer of milk and cream from Sri Lanka in value terms, accounting for 73.7% of total exports. Other countries shared the remaining volume.

Structure of product's exports in value by countries, 2017-2020

World map of product's exports from Sri Lanka in value, 2017-2020

Imports milk and cream to Sri Lanka

Imports in kind, t

Milk and cream imports into Sri Lanka declined for the third consecutive year. In 2020, imports totaled 312.2 tons, representing a strong decline of 24.1% relative to the prior year. Over the period from 2017 to 2020, imports decreased by 36.3%, with a compound annual growth rate (CAGR) of -14.0%.

Annual dynamics of product's imports to Sri Lanka in kind, 2017-2020, t

Throughout 2017 to 2020, New Zealand, Denmark, and the United Kingdom were the key sources for milk and cream imports in kind into Sri Lanka. New Zealand accounted for 67.8% of imports, Denmark for 8.3%, and the United Kingdom for 6.3%. Together, these three countries comprised 82.5% of total import flows.

Structure of product's imports in kind by countries, 2017-2020

World map of product's imports to Sri Lanka in kind, 2017-2020

Imports in value, K $ US

Milk and cream imports into Sri Lanka in value terms declined for the third consecutive year. In 2020, imports totaled 700 thousand US dollars, representing a 36.6% decline over the past year. Over the period from 2017 to 2020, imports decreased by 55.3%, with a compound annual growth rate (CAGR) of -23.6%.

Annual dynamics of product's imports to Sri Lanka in value, 2017-2020, K $ US

From 2017 to 2020, New Zealand, the United Kingdom, and Denmark were the main suppliers of milk and cream to Sri Lanka in value terms. New Zealand accounted for 60.6% of imports, the United Kingdom for 10.3%, and Denmark for 7.6%. Together, these three countries comprised 78.5% of total imports in value terms.

Structure of product's imports in value by countries, 2017-2020

World map of product's imports to Sri Lanka in value, 2017-2020