Population decline, negative effect on dairy consumption, operators reduce prices

Consumer demand for dairy products continued to grow in 2025, driven by lower prices. But dairy processors say demand is declining in areas with high immigration.

Luis Ndreka, head of the dairy processing company ADG (formerly “Lufra”), said that during 2024, there was a price drop of up to 5% in some dairy products, which improved demand.

“The year 2025 has started well. Turnover data is higher than last year. The increase in demand was influenced by the increase in prices of some dairy products, but also by the company’s internal managerial improvements,” he claims.

Specifically, referring to wholesale prices, last year 1 kg of yogurt was sold for 147 lekë, while in January-February 2025 it is being sold for 140 lekë per kg. The situation is the same for other products, such as white cheese, kaçkavall, sauce and cottage cheese, as during 2024 we had slight price reductions.

Despite the decline in dairy product prices, demographic changes in the population continue to affect consumer demand, especially in regions where young people’s emigration, both to Tirana and abroad, is high.

Meanwhile, the decrease in the number of foreign tourists in Tirana in the January-February period, where compared to years their flow was higher, is also having an effect on slowing down the growth of sales for dairy products.

In the city of Tirana we have the smallest increase in sales, which may also have been influenced by the decline in the flow of foreign tourists.

While in almost all major cities there has been an increase in demand, except for the cities of the southeastern area, Pogradec and Korça, influenced by the decline in population in this area. The highest increase in demand has been in cities such as Gjirokastër, Berat, Saranda, etc.

For 2025, dairy processing operators predicted cost increases from the continuation of the policy of increasing employee payments. The increased cost from the wage fund was expected to be amortized with increases in consumer product prices.

Mr. Ndreka highlighted that for the period January-February 2025, the increase in wage costs was eliminated by the decline in the prices of imported raw materials. However, he says that a slight price indexation is expected during the year, depending on the change in total production costs.

Source: Customs

Source: Customs

In 2024, milk imports increased by 23%

The increase in milk imports continued during 2024. According to Customs data for 2024, 22,8 million liters of milk were imported. Compared to 2023, imports increased by 23%. In January 2025, milk imports decreased by 6% compared to January 2024.

Imports are expected to increase further in 2025, as processing operators plan to purchase milk as raw material from abroad during the summer months.

“At the moment, we do not plan to buy imported milk, because we have more milk than we need. But during the summer months, we definitely plan to buy, as we cannot meet our needs with local production from farmers,” says Luis Ndreka, from the ADG company.

For the processing industry, high production costs due to the expensive prices of domestic milk supplies for raw materials continue to be a problem.

“The price of cow’s milk on large farms in the country is 66 lek per liter (excluding VAT). On small farms (where the costs of collecting it are higher) the price of milk goes up to 60 lek (excluding VAT). This is at the farm gate, so without transport,” says Mr. Ndreka.

Since January 2025, farmers have been facing increased costs for keeping livestock due to the increase in feed prices of up to 60%. The price of corn from 27 lek/kg that was previously traded, is currently being purchased at 34 lek/kg. The increase is 26%.

The price of hay from 22 lek/kg is now 29 lek/kg. The increase is 24%. The price of barley from 25 lek/kg has reached 33 lek/kg. The increase is 32%. While the price of alfalfa from 500 lek that was traded in the May-June period, is currently 700-800 lek/dengu. The increase ranges from 40 to 60%.

But for processors, the increase in costs is not expected to bring another increase in the price of milk for collection, as demand is lower than supply. “Currently there is a lot of production and in the spring even more is expected.

“Processors have built up a lot of stock for the summer months. I don’t think that under these conditions a price increase can be accepted, as there is more supply than demand,” says Mr. Ndreka from the ADG company.

While agronomists warned that the increase in nutrient prices is expected to affect the reduction of livestock on farms.

Despite frequent price reductions, which were twice accompanied by protests by livestock farmers in April 2024, milk produced by local farmers continues to remain more expensive, compared to milk produced in the region or Europe,

During that period, cow’s milk from large and medium-sized farms was collected at a price of 65 to 67 lek excluding VAT per liter from the previous 78 lek excluding VAT (a decrease of 16 to 20%).

While from small farms, milk was collected at a price of 60 lek excluding VAT per liter.

While the price of cow’s milk in 2024 from imports, including the cost of transportation and taxes, reached 55 lek per liter, or about 38 lek per liter cheaper than domestic production.

Experts claim that the lack of subsidies per liter of milk produced creates a large difference in the selling price of cow’s milk compared to farms in the region and Europe.

Source: Customs