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Dairy Exports Thrive Despite Global Trade Barriers

Jun 19, 2025
By Farms.com

U.S. Dairy Shines in 2025 but Trade Risks Remain High

The U.S. dairy industry started 2025 on a high note, with exports exceeding $3 billion by April. This helped offset a growing $20 billion agricultural trade deficit and highlighted the sector’s importance to global markets. Top export products include cheese, nonfat dry milk, and powdered ingredients like lactose.

Dairy exports reached 114 countries in 2024, but three—Mexico, Canada, and China—accounted for over half of total value. These countries, however, face complex trade tensions.

Mexico remains the largest dairy buyer but experienced early 2025 U.S. tariffs, causing diplomatic friction. While agricultural products were mostly spared, the risk of retaliation remains high.

Canada continues to protect its dairy sector using quotas, tariffs, and domestic rules that limit real access.

Although USMCA aimed to open the market, Canada’s handling of import licenses and pricing policies has drawn criticism and limited meaningful trade expansion.

China is a major buyer of U.S. dairy coproducts like whey and lactose, crucial to its pork industry. Recent U.S. tariffs and retaliations reduced competitiveness until a temporary tariff reduction agreement was reached in May 2025.

India presents long-term potential but remains closed to U.S. dairy due to cultural restrictions, steep tariffs, and complex certification requirements. Despite progress in other trade areas, dairy access remains unresolved.

The EU poses additional hurdles through high tariffs and non-science-based standards. Disputes over cheese names also impact U.S. exports, despite dairy being excluded from the EU’s most recent retaliatory tariff list.

“The U.S. dairy industry must continue to look beyond our borders to stay competitive and profitable.”

Emerging markets like Indonesia and Vietnam offer growth potential but are slowed by plant approval requirements. With growing global demand, trade engagement is key to ensuring American dairy remains competitive and accessible worldwide.


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