China dairy imports show first signs of recovery in March

March was a positive month, although five commodities still recorded declines. Notable volume decreases were observed in SMP, whey, caseinates, lactose, and liquid milk. Overall, March concluded with an increase in imports of +1.95%, equivalent to 29 million kilo LME. This marks the first month of year-on-year growth since October 2025. Chinese dairy imports - March (tons) Product 2025 2026 ∆ ∆% SMP 25,746 19,610 -6,136 -23.83% WMP 43,236 57,973 14,737 34.09% Whey 67,812 50,832 -16,980 -25.04% WPC80/WPI's 2,592 3,229 637 24.58% Casein 178 2,314 2,136 1200.00% Caseinates 2,196 1,374 -822 -37.43% Lactose 15,770 11,694 -4,076 -25.85% I/F 18,496 18,892 396 2.14% Cheese 16,726 23,509 6,783 40.55% Butter 10,493 14,563 4,070 38.79% AMF 2,658 5,795 3,137 118.02% Cream 21,488 30,069 8,581 39.93% Yoghurt 524 751 227 43.32% Condensed 1,305 1,414 109 8.35% Milk 27,503 26,017 -1,486 -5.40% Cumulative performance through March remains negative, but the March result represents a corrective step. Several commodity segments, including SMP, WMP, whey, WPC80/WPI, caseinates, lactose, and AMF, have continued to underperform expectations. Year-to-date imports through March declined by -9.06%, or 406 million kilo LME, compared to -14.46% year-to-date February, which equated to a loss of 428 million kilo LME. Chinese dairy imports - YTD March (tons) Product 2025 2026 ∆ ∆% SMP 76,247 51,176 -25,071 -32.88% WMP 147,195 134,900 -12,295 -8.35% Whey 181,277 157,204 -24,073 -13.28% WPC80/WPI's 8,656 8,202 -454 -5.24% Casein 3,993 6,178 2,185 54.72% Caseinates 6,836 6,395 -441 -6.45% Lactose 40,305 29,218 -11,087 -27.51% I/F 47,800 49,521 1,721 3.60% Cheese 46,280 62,160 15,880 34.31% Butter 35,305 37,218 1,913 5.42% AMF 11,610 10,652 -958 -8.25% Cream 66,123 74,322 8,199 12.40% Yoghurt 2,208 2,608 400 18.12% Condensed 838 3,313 2,475 295.35% Milk 89,418 92,101 2,683 3.00% The pace of decline began to ease during the July–October 2024 period, with early signs of a shift in momentum emerging in November and December. This improvement carried into the first half of 2025, although August recorded another year-on-year decline. While September and October returned to positive territory, imports declined again in November and December. The start of 2026 was particularly weak, with losses comparable to those last seen in 2024.In China, economic conditions remain mixed. The labour market continues to be constrained by persistently high unemployment. Inflation trends have been more volatile: after declining from August, inflation briefly increased in January before turning negative from February through May. June and July returned to positive territory, but August and September again recorded negative figures. Inflation recovered in October and remained positive through March, with inflation reaching 1% in that month.In addition to broader economic challenges, low domestic milk prices continue to weigh on the market. Farmgate prices in March 2026 stood at CNY 303 per 100 kilo, or EUR 38 per 100 kilo.Surplus milk production is expected to translate into increased export activity, a trend that began to emerge in 2025 export data. However, year-to-date figures through March have turned negative: exports shifted from +138% (404 million kilo LME) in December 2025 to -18.83%, or -26 million kilo LME, year-to-date March. Chinese dairy exports - YTD March (tons) Product 2025 2026 ∆ ∆% SMP 1,455 2,479 1,024 70.38% WMP 11,436 7,790 -3,646 -31.88% WPC80/WPI's 0 3 3 0.00% Casein 24 46 22 91.67% Caseinates 29 85 56 193.10% Lactose 170 238 68 40.00% I/F 1,885 1,823 -62 -3.29% Cheese 773 343 -430 -55.63% Butter 1,959 594 -1,365 -69.68% AMF 454 457 3 0.66% Yoghurt 1,043 836 -207 -19.85% Cream 38 69 31 81.58% Fermented 874 1,058 184 21.05% Condensed 209 693 484 231.58% Milk 7,895 10,487 2,592 32.83% Shipments below 400 tons are most likely return consignments, while volumes exceeding this threshold may indicate an early shift toward China becoming both a dairy importer and exporter.Export performance by product category has been notable. SMP exports increased by 70%, while liquid products also recorded strong growth. Although still at an early stage, recent performance—particularly in SMP, WMP, infant formula, butter, and liquid milk—suggests that China could emerge as a more significant dairy exporter in the coming years.