Milk powder market in South America

Earlier Report Observations

The South American milk powder market opened the period at 1 132 thousand metric tons in 2018. After a slight contraction to 1 078 thousand metric tons in 2019, consumption jumped to 1 184 thousand metric tons in 2020. This surge was primarily driven by the COVID-19 pandemic, which increased demand for long-shelf-life dairy products, coupled with innovations in processing and packaging to adapt to new consumption habits.

Market volume then fell to 1 123 thousand metric tons in 2021, pressured by operational issues at major Argentine processing plants like SanCor and Verónica, which constrained supply, alongside rising energy and raw material costs that dampened consumer spending. The decline continued to 1 022 thousand metric tons in 2022, as adverse weather conditions in Mercosur limited regional production, and the Ukraine conflict exacerbated global supply chain disruptions and living costs.

A recovery followed in 2023, with volume reaching 1 145 thousand metric tons. This rebound was supported by sustained consumer preference for convenient, long-lasting dairy items and increased production and export activity within Mercosur, despite persistent high prices and climatic uncertainties such as El Niño.

Production milk powder in South America

In kind, 2017-2020, K t

Top producers of milk powder, 2017-2020

World map of production of milk powder, 2017-2020

South America produced 1 208 K t of milk powder in 2020, representing a 3.8% year-over-year increase. Over the period from 2017 to 2020, production grew by 8.3%, which translates to an annualized growth rate of 2.7%. The most significant increase occurred in 2018, at 4.4%, while 2019 saw minimal change.

Annual dynamics of production in South America in kind, 2017-2020, K t

In value, 2017-2020, M $ US

South America's milk powder production value rose for the second consecutive year. In 2020, output was valued at 4 749 M $ US, up 33.7% from the previous year. From 2017 to 2020, production increased by 17.8%, with an annualized rate of 5.6%. The lowest value was recorded in 2018 at 3 421 M $ US, which also marked the largest decline of 15.2%.

Annual dynamics of production in South America in value, 2017-2020, M $ US

Exports milk powder from South America

Exports in kind, K t

South America's milk powder export volume declined for the second year in a row. In 2020, exports totaled 258.6 K t, a 6.5% decrease year-over-year. Between 2017 and 2020, exports increased by 26.6%, equating to an annualized growth rate of 8.2%. The peak was in 2018 at 313.6 K t, with the largest increase of 53.6% that year, while 2019 saw the largest decline of 11.8%.

Annual dynamics of product's exports from South America in kind, 2017-2020, K t

From 2017 to 2020, South America's milk powder exports in kind were diversified across multiple partners. Algeria accounted for 39.2% of exports, Russia for 5.3%, and China for 4.8%, together making up 49.4% of total flows. The remaining 50.6% was distributed among numerous smaller markets.

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

World map of product's exports from South America in kind, 2017-2020

Exports in value, M $ US

In 2020, South America's milk powder export value reached 1 017 M $ US, a 20.4% increase compared to 2019. Over the 2017-2020 period, exports grew by 37.7%, with a compound annual growth rate of 11.2%. The largest decline was in 2019 at 8.4%, while the largest increase occurred in 2018 at 24.8%.

Annual dynamics of product's exports from South America in value, 2017-2020, M $ US

Between 2017 and 2020, Algeria, Russia, and China were notable buyers of South American milk powder in value terms, with shares of 39.2%, 5.1%, and 4.6%, respectively. However, their combined share was only 49.0% of total exports, indicating a diverse market without a single dominant partner.

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

World map of product's exports from South America in value, 2017-2020

Imports milk powder to South America

Imports in kind, K t

South America imported 234.6 K t of milk powder in 2020, a 22.2% increase from 2019. From 2017 to 2020, imports decreased by 7.4%, with an annualized decline of 2.5%. The lowest volume was in 2019 at 192.0 K t, which also saw the largest decline of 32.1%, while the peak was in 2018 at 282.8 K t.

Annual dynamics of product's imports to South America in kind, 2017-2020, K t

During 2017-2020, South America's milk powder imports in kind were spread across various countries. The United States contributed 22.0% of imports, Mexico 12.6%, and New Zealand 8.2%, together accounting for 42.8% of total flows. No single partner emerged as clearly dominant, reflecting a scattered import structure.

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

World map of product's imports to South America in kind, 2017-2020

Imports in value, M $ US

Following a two-year decline, South America's milk powder import value increased in 2020. Imports amounted to 750 M $ US, marking a dramatic 31.8% rise from the previous year. The lowest value was recorded in 2019 at 569 M $ US, which also experienced the largest decline of 22.4%.

Annual dynamics of product's imports to South America in value, 2017-2020, M $ US

From 2017 to 2020, South America's milk powder imports in value terms were distributed among multiple countries. The United States accounted for 19.1% of imports, Mexico for 10.4%, and New Zealand for 8.8%, totaling 38.3% of flows. No partner stood out as clearly dominant, maintaining a scattered import profile.

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

World map of product's imports to South America in value, 2017-2020