Amid a sharp decline in per capita dairy consumption in Iran, official statistics show an unprecedented increase in dairy exports in 2024 compared to previous years.
According to the Iranian regime’s customs office, dairy exports in 2024 increased by 43% in value and 19% in volume.
The report indicates that over 587,347 tons of various dairy products, worth approximately $948.9 million, were exported to 46 different countries during this period.
This export growth occurred alongside rising global prices for powdered milk, strengthening suspicions that domestic dairy supply has been deliberately reduced, prices inflated to curb local demand, and raw milk redirected toward production and export of powdered milk in international markets.
Export Incentives and the Dairy-Depleted Iranian Household Basket
Major dairy companies’ inclination to focus on export markets has resulted in reduced product variety in the domestic market.
However, the decline in per capita dairy consumption in Iran is not due to changes in dietary patterns or consumer preferences. Data shows the main cause is the steep rise in dairy prices, leading to its gradual elimination from the household shopping basket.
Despite some dairy products being listed for electronic subsidy support, this measure has failed to halt the downward trend in consumption.
According to official data, Iran’s per capita dairy consumption has dropped from around 130 kilograms in 2010 to about 55 kilograms in 2024.
This figure is alarmingly lower than the global average of 150 to 160 kilograms, and drastically behind countries like France and parts of Northern Europe, where per capita consumption can reach up to 300 kilograms.
Nutritional and Health Consequences of Declining Dairy Intake
Health experts have repeatedly warned that the continued drop in dairy consumption in Iran will have far-reaching consequences on public health.
Calcium deficiency, osteoporosis, impaired growth in children and adolescents, and various health problems among the elderly are just some of the medical outcomes of this trend.
A notable concern is the reduction in production of certain dairy types, aimed at narrowing variety and maximizing export profits, which points to the industry’s deliberate effort to remove raw milk from the domestic supply chain.
In June 2024, Mohammadreza Banitaba, then-spokesperson for Iran’s Dairy Industry Association, identified declining household purchasing power and rising production costs as the two main reasons for the drop in per capita dairy consumption.
According to him, misguided policies by the Central Bank, the Ministry of Economy, and other executive bodies have led to increased inflation. As a result, production costs have risen while consumers have lost their purchasing ability.
The Government’s Role in the Conflict Between Foreign Currency Revenues and Public Nutrition
This situation raises a critical question for the government: While part of the subsidy for importing livestock feed is allocated to supporting dairy farms, why is there no direct subsidy for dairy products aimed at lower-income segments of society?
In reality, it appears that the nutritional health of citizens has been sacrificed for the sake of foreign currency revenues from dairy exports.
Producers, by exporting their goods, have not only jeopardized domestic consumption but have also benefited from government subsidies.
Economic experts argue that if a significant portion of these subsidies had been paid directly to consumers, it could have prevented the decline in dairy consumption and the incentive to export.
Another Raw Milk Price Hike Signals New Waves of Inflation
According to an official announcement on May 17, the purchase price of one kilogram of raw milk—with 3.2% fat, 3% protein, and a microbial count below 100,000—has increased by 50,000 rials.
Experts estimate that, given raw milk’s 27.7% share in the final price of dairy products, this increase could lead to a 65% to 90% surge in the prices of various dairy products, depending on the type.
For example, the price of one liter of low-fat pasteurized milk is expected to rise from the current range of 330,000 to 390,000 rials to over 550,000 rials (approximately $0.66).
Doubts Over Producer Motives and the Role of the Global Powdered Milk Market
If, as production companies claim, rising dairy prices result from increased production costs and decreased output, then how has export volume simultaneously experienced such dramatic growth?
Is the continual price hike a deliberate strategy to diminish domestic purchasing power and shift production toward export markets?
Moreover, the dairy industry’s export drive coincides with the rise in global powdered milk prices, raising concerns about potential shortages in Iran’s domestic market.
In recent years, families have faced significant challenges in accessing powdered milk at various points.
Rationing by national ID number, limited distribution, and black markets were recurring problems between 2021 and 2024.
Ample evidence suggests that in times of economic hardship, Iran’s regime has prioritized maximizing foreign currency revenue from dairy exports over the nutritional well-being of its population.
This approach has not only resulted in an unprecedented drop in per capita dairy consumption but has also endangered the health of millions of Iranians—particularly children, the elderly, and low-income groups.
