Milk prices in Malawi have surged by 42% since April, with processors paying dairy farmers K700 per liter, up from K490. This sharp increase is driven by the industry’s push to meet the government’s new minimum price of K800 per liter.
According to the Malawi Milk Producers Association (MMPA), the price has climbed steadily, reaching K590 by May and K700 by the end of July. This upward trend is expected to continue, with the K800 minimum likely to be reached by October.
MMPA national director Herbert Chagona described the price trend as “impressive,” attributing it to processors’ efforts to adjust to the new government mandate. Processors initially resisted an immediate price jump, citing the non-seasonal nature of the dairy industry and consumer behavior.
Despite the price increase, some farmers argue it is still not enough. Jessie Lunguzi, chairperson of the Central Region Milk Producers Association, stated that the current price remains “below the cost of production,” suggesting a fair price would be no less than K1,000 per liter.
Meanwhile, Bob Dzombe, a director at Malawi Dairy Industries (MDI), expressed concern that the new farm-gate price might be too high for consumers. He noted that processors also face rising costs from importing additives, which require foreign exchange.
Malawi’s dairy sector has shown significant growth, with milk production rising from 61 million liters in 2023 to 66 million liters in 2024. However, with only about 70,000 dairy cows against a demand for up to 200,000, the industry has substantial room for expansion. Farmers believe that higher prices will incentivize them to increase production.
The price hike is unrelated to recent import restrictions, as the ban did not affect UHT milk, which is the primary form of imported milk. This leaves the local demand and supply dynamics as the main drivers of the price increase.
