Brazil milk prices extend decline as supply hits record
Rising output and inventories pressure dairy market
2 January 2026
1 minute read
By: Milk prices paid to Brazilian dairy farmers fell for an eighth consecutive month, reflecting ample supply in the domestic market, according to Cepea. Compared with October, prices dropped 8.31%, while values were down 23.3% from November 2024 in real terms, based on IPCA November 2025, closing at BRL 2.1122 per litre in the Brazil Average.
In real terms, milk prices have declined 21.2% so far this year. Cepea attributed the downward trend to a sharp increase in supply. The centre projects industrial milk production to rise 7% in 2025, reaching a record 27.14 billion litres. Output has been supported by investments made in 2024 and favourable weather in 2025, which stimulated production in the Southeast and Central-West and limited the usual seasonal decline in the South.
Production costs have also increased. From October to November, the ICAP-L rose 1.61% in the Brazil Average, bringing the cumulative increase for the year to 15.9%.
Supply has been further bolstered by imports. Although imports fell 14.8% in November, volumes remained high. From January through November, Brazil imported nearly 2.05 billion litres of milk equivalent, down 4.8% from the same period last year, when imports reached a record. Exports declined 33% year over year to 62.4 million litres of milk equivalent.
Market participants surveyed by Cepea reported a sharp rise in dairy inventories. With the market well supplied, prices for dairy products have been under pressure, limiting margins for dairy processors.
