Cha-am: Dairy cooperatives in Thailand are expressing concerns about the potential negative impact of importing powdered milk under free trade agreements (FTAs) on local farmers. The Cha-am-Huai Sai Dairy Cooperative has highlighted that several dairy processing plants restricted the purchase of raw milk from farmers last year. They worry that the importation of powdered milk will further complicate the situation for domestic raw milk, which is already costlier and harder to sell.
According to Thai News Agency, Mr. Somkuan Sawangarom, manager of the Cha-am-Huai Sai Dairy Cooperative Limited, noted a noticeable slowdown in the market for raw milk from Thai farmers. This slowdown has been particularly pronounced for surplus milk from the school milk program, which was more readily available in previous years. In 2025, several plants limited their purchases to quantities agreed upon in memorandums of understanding with the cooperative, which has made selling raw milk increasingly challenging.
The cooperative is also concerned about the impact of FTAs that allow duty-free imports of powdered milk from countries like Australia and New Zealand. This situation could pose significant challenges for domestic farmers, especially small-scale operations that face high costs and need to maintain continuous production. In contrast, powdered milk can be imported based on market demand at a lower cost.
The cooperative has a contract to supply one ton of raw milk daily to the Dairy Farming Promotion Organization of Thailand (DPO), delivering this volume to the DPO's southern plant. This arrangement has shielded them from the purchasing slowdown affecting the central region. However, during a recent holiday, the cooperative had to discard some raw milk as their pasteurized milk production plant was unable to process the entire volume.
Mr. Somkuan has urged the government to develop a plan to manage domestic raw milk resources before becoming overly reliant on imported powdered milk. He also suggested that powdered milk manufacturers should collaborate to support Thai dairy farmers through reasonable mechanisms.
At a recent Dairy and Dairy Product Policy Committee meeting, a resolution was passed approving management guidelines for the dairy industry, including quotas and import volumes of skimmed milk powder for 2026. The import allocation, totaling 47,576.5 tons, will be conducted in two rounds, taking into account the domestic dairy industry situation.
The proposed imports for 2026 have raised concerns among dairy farmers, who fear that increased imports will further challenge the raw milk market, complicating the sale of their daily produce. Mr. Somkuan emphasized that while the limitations of global free trade are understood, it is crucial to ensure that local farmers' livelihoods are not jeopardized.