Welcome to read the July issue of Dairy Products China Monthly Report
In July 2026, the International Monetary Fund downgraded its global growth forecast to 3.0% and raised its inflation outlook to 4.7%, identifying Middle East conflicts, trade fragmentation and shifting expectations around AI as three major downside risks. Global trade growth is expected to slow from 5% to 3.5%. The global dairy sector is entering a phase of supply recovery and tepid demand, adding uncertainty to global trade and pricing strategies.
Domestically, China's GDP grew 4.7% YoY in H1 2026, slowing to 4.3% in Q2. June exports and imports surged 27% and 36%, respectively, underscoring external demand resilience. The July Politburo meeting outlined measures to stabilise growth and boost domestic demand, with funding for major construction and equipment renewal now fully allocated.
Divergence within the industry is widening. This report examines contrasting H1 earnings forecasts, growth momentum in the cheese segment, and the shift from product‑based exports to brand‑led global expansion. Against a backdrop of volatile raw material costs and upgrading consumption patterns, companies with strong technology, diverse channels and global reach are best positioned to navigate the ongoing structural shake‑out.
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