For the dairy segment, 2026 will be a period of caution. This is because the sector returned to “defensive mode”, in the face of market uncertainties and the producer’s loss of profitability. With GDP growth projected to be around 2% and consumption still depressed, the outlook is for a rebalancing between supply and demand. “To achieve this, production will need to grow at a more moderate pace,” says Natália Grogol, a researcher at Cepea.
Initial projections point to an increase of around 2% in national production, lower than that recorded in 2025, of 7%. Despite the challenging environment, some factors can be positive.
The researcher points out that the grain market signals less volatility, which could stabilize feed costs and make room for slightly better margins, even with revenues under pressure. According to her, the forecast is for greater price stability from the third quarter of 2026, possibly with peaks in increases between May and August, a period in which there is traditionally a reduction in capture on more extensive farms.
Even so, the beginning of 2026 should reflect the losses accumulated in the second half of 2025. “The industry started the year with high inventories. Furthermore, there is the challenge of selling production in an environment of greater competition, mainly with the presence of imported dairy products”, assesses Geraldo Borges, president of Abraleite, an association that brings together producers.
Resumption of growth
After facing a deep crisis in 2023, the Brazilian dairy sector experienced a period of greater tranquility in 2024, a movement that stimulated an increase in production and contributed to an expansion of supply. The result, however, was an imbalance in the domestic market, aggravated by the growth in imports and the stagnation of consumption.
As a result, at the end of 2025, the segment underwent a period of restructuring due to excess production and reduced margins
According to the president of Abraleite, the formal milk market in Brazil is estimated at around 25 billion liters per year, in addition to approximately 2 billion liters that circulate outside the inspection system. In 2025, imports totaled 2 billion liters, increasing the share from 1.5% to 9% of the total consumed in the country — a significant jump that further expanded supply at a time of weakened demand.
The combination of rising production and domestic consumption without consistent growth put pressure on prices and reduced profitability. The first quarter of 2025 still showed positive performance, but the second marked a turning point. Some dairy categories managed to maintain reasonable results, while others were already facing difficulties. In the third and fourth quarters, the scenario deteriorated more intensely, with narrow margins for both producers and the industry.
The average price of milk to producers (“Brazilian Average”) measured by CEPEA-Esalq/USP fell to R$ 1.9966 per liter in December 2025, marking a drop of 5.78% compared to November 2025 and 25.79% compared to December 2024. ä
