German MIV expects more dairy farmers to retire

In its usual annual press conference in January, the MIV looked back at 2025 and ahead to what's to come. According to Chairman Detlev Latka, also CEO of the Hochwald cooperative, first nine months Last year, he rated it "very good." This can be seen as an encouraging sign that the German dairy sector is able to make money. After that, things quickly declined. He expects the milk price to have not yet bottomed out; this is likely to happen in March.

High milk production is responsible for the market turnaround, Latka explains. He points to several factors, such as the delayed seasonal peak in milk production due to bluetongue. In addition, high milk prices and affordable feed prices stimulated production. "There's a global trend. Only in Australia is milk supply lower than last year. In all other major production areas, such as the EU, the United States, and New Zealand, there is rapid growth."

High supply, weak demand
In Germany, supply at the end of 2025 was over 7% higher than in 2024, according to MIV. This is causing problems in the supply chain, such as a lack of processing capacity. Latka also points to lagging consumer demand. According to Latka, the recent butter war unleashed by retailers in Germany is a reaction to the market imbalance, he says when asked. "It's a typical German phenomenon that retailers in our country then start offering stunts with extremely low prices, which doesn't help sentiment." The MIV criticizes this.

More quitters in 2026
Despite the current high milk supply, the MIV remains concerned about the long-term availability of milk. An average of 3% to 5% of German dairy farmers quit each year. Last year, there were fewer because potential quitters, encouraged by high milk prices, continued milking for a while. Due to the market turnaround, the organization expects an increase in quitting by 2026, although it is not making concrete forecasts. Bankruptcies are currently not an issue because German dairy farmers have sufficient buffers, although costs have also increased in recent years.

'Dairy market is always unpredictable'
All in all, it's difficult to predict the direction of the dairy market in 2026. "It's impossible to estimate when the market will turn around," says Latka. However, he's not necessarily pessimistic. "Milk is a natural product, the availability of which can be quickly affected by external factors that are not yet visible. That always makes the dairy market unpredictable." He is positive about the Mercosur agreement, as it offers additional export opportunities in South America, particularly for cheese, condensed milk, and high-quality milk powder. At the same time, the US, through President Donald Trump, recently announced its intention to increase import duties. "We'll have to wait and see what the details are," says Latka.