Milk market in Indonesia

Earlier Report Observations

The Indonesian milk market volume grew from about 1.8 million tonnes in 2018 to nearly 1.9 million tonnes in 2022, a rise sustained largely by increasing imports needed to meet national demand as domestic fresh milk production remained low. This period saw significant investments from major processors like Frisian Flag Indonesia and Nestlé into digitalizing milk collection and modernizing operations, which supported supply chain development while per capita consumption stayed stagnant.

Market volume dropped to 1.6 million tonnes in 2023. This decline occurred alongside the implementation of a new Indonesian National Standard (SNI) for plain liquid milk, which replaced previous standards and required producers to adapt their processes. Persistent outbreaks of foot-and-mouth disease in dairy cattle herds also continued to constrain local milk output throughout this period.

Structural challenges such as low dairy cow productivity, an aging farmer base, and high import dependency limited domestic production growth across the years. Concurrently, consumer preferences shifted from powdered and condensed milk toward liquid milk, encouraging further investment in UHT and pasteurized segments, including from foreign entrants like Qatar-based Baladna.

Production milk in Indonesia

In kind, 2018-2021, K t

Top producers of milk, 2018-2021

World map of production of milk, 2018-2021

Indonesia's milk production volume declined after two years of improvement. In 2021, the country produced 1,550 K t of milk, marking a 0.6% year-over-year decrease. The largest increase was recorded in 2019 at 0.7%, while production peaked in 2020 at 1,559 K t.

Annual dynamics of production in Indonesia in kind, 2018-2021, K t

In value, 2018-2021, M $ US

Milk production in Indonesia increased for the third consecutive year. In 2021, output was valued at 3,235 M $ US, reflecting a 4.8% uptick compared to 2020. Between 2018 and 2021, production grew by 26.1%, equating to an annualized rate of 8.0%.

Annual dynamics of production in Indonesia in value, 2018-2021, M $ US

Exports milk from Indonesia

Exports in kind, K t

After a two-year gain, Indonesia's cross-border shipments of milk declined. In 2021, exports stood at 14.3 K t, corresponding to a moderate 5.9% year-over-year reduction. The largest increase was recorded in 2019 at 5.8%, while exports peaked in 2020 at 15.2 K t. Over the period 2018-2021, exports increased by 5.3%, with a compound annual growth rate of 1.7%.

Annual dynamics of product's exports from Indonesia in kind, 2018-2021, K t

From 2018 to 2021, Singapore, the Philippines, and Timor-Leste played the leading roles in Indonesia's milk exports in kind. Singapore accounted for 31.5% of exports, the Philippines for 27.0%, and Timor-Leste for 10.6%, jointly taking 69.2% of total flows.

Structure of product's exports in kind by countries, 2018-2021

World map of product's exports from Indonesia in kind, 2018-2021

Exports in value, M $ US

After a two-year increase, Indonesia's exported milk volumes declined. In 2021, the country exported 29.8 M $ US of milk, reflecting a slight 0.8% year-over-year drop. The largest increase was recorded in 2019 at 19.8%, while exports peaked in 2020 at 30.0 M $ US. Over the period 2018-2021, exports grew by 32.2%, with a compound annual growth rate of 9.8%.

Annual dynamics of product's exports from Indonesia in value, 2018-2021, M $ US

From 2018 to 2021, the Philippines, Timor-Leste, and Singapore headed the ranking of buyers of milk from Indonesia in value terms. The Philippines accounted for 30.4% of exports, Timor-Leste for 20.9%, and Singapore for 14.6%, with their combined share reaching 65.9% of total exports.

Structure of product's exports in value by countries, 2018-2021

World map of product's exports from Indonesia in value, 2018-2021

Imports milk to Indonesia

Imports in kind, K t

Indonesia's milk shipments from abroad increased for the third consecutive year. In 2021, the country imported approximately 290.6 K t of milk, up by 6.4% from a year earlier. Over the period 2018-2021, imports grew by 23.4%, with a compound annual growth rate of 7.3%.

Annual dynamics of product's imports to Indonesia in kind, 2018-2021, K t

From 2018 to 2021, New Zealand, the United States, and Belgium formed the core of Indonesia's milk imports in kind. New Zealand accounted for 29.4% of imports, the United States for 27.4%, and Belgium for 11.2%, together taking 67.9% of total flows.

Structure of product's imports in kind by countries, 2018-2021

World map of product's imports to Indonesia in kind, 2018-2021

Imports in value, M $ US

Indonesia's volume of milk imports increased for the third consecutive year. In 2021, imports amounted to 859.4 M $ US, marking a substantial 17.2% gain from 2020. Between 2018 and 2021, imports grew by 63.6%, equating to an annualized rate of 17.8%.

Annual dynamics of product's imports to Indonesia in value, 2018-2021, M $ US

From 2018 to 2021, three main markets—New Zealand, the United States, and Australia—together absorbed 72.5% of total imports in value terms of milk to Indonesia.

Structure of product's imports in value by countries, 2018-2021

World map of product's imports to Indonesia in value, 2018-2021