Global Economy Enters Critical Period Amid Trade Barriers and Policy Uncertainty

Strategic Insights -

The global economy, including the Chinese dairy industry, is experiencing a critical period due to trade barriers and an uncertain global policy environment. The World Bank has significantly lowered its forecast of global economic growth in 2025 to 2.3% from 2.7% in January. Meanwhile, China's national economy has remained stable, with a 5.3% year-on-year increase in gross domestic product in the first half of the year. The dairy industry, which has been adjusting for over three years, is at a new turning point, with signs of recovery emerging, but still facing cyclical development challenges.

Key Takeaways:

  • The global economy has entered a critical period due to trade barriers and uncertainty in the global policy environment, with the World Bank lowering its forecast of global economic growth in 2025 to 2.3%.
  • China's national economy has remained generally stable, with a 5.3% year-on-year increase in gross domestic product in the first half of the year.
  • The dairy industry is at a new turning point after over three years of adjustment, with signs of recovery emerging, but still facing cyclical development challenges.
  • The average price of raw milk in major producing provinces decreased by 7.0% year-on-year to RMB3.04 per kilogram in the fourth week of June.
  • The dairy industry is at a critical juncture, needing cooperation from all sectors to integrate policies, technologies, and financial resources to promote relief and optimize production capacity.
  • The dairy industry is set to usher in a new five-year plan under the 15th Five-Year Plan, entering a critical juncture in a new round of development.
  • Per capita milk consumption in China is still less than one-third of the world average, indicating enormous potential for future development.
  • The Ministry of Agriculture and Rural Affairs, the National Health Commission, and the Ministry of Industry and Information Technology have jointly issued the China Food and Nutrition Development Outline (2025-2030), which proposes increasing per capita annual milk consumption to 47 kilograms by 2030.
  • The dairy industry is expected to address the issue of insufficient rigid demand for raw milk through more flexible and effective measures as the consumption structure of dairy products continues to optimize and product diversification develops.

Statistics:

  • 2.7%: World Bank's previous forecast of global economic growth in 2025
  • 2.3%: World Bank's revised forecast of global economic growth in 2025
  • 5.3%: Year-on-year increase in gross domestic product in China in the first half of the year
  • RMB66,053.6 billion: China's gross domestic product for the first half of the year
  • RMB3.04 per kilogram: Average price of raw milk in major producing provinces in the fourth week of June
  • 7.0%: Year-on-year decrease in average price of raw milk in major producing provinces
  • 15th Five-Year Plan: New five-year plan for the dairy industry
  • 2025-2030: Period covered by the China Food and Nutrition Development Outline

Sources:

  • World Bank's Global Economic Prospects report, released in June 2025
  • National Bureau of Statistics' data released in July 2025
  • Ministry of Agriculture and Rural Affairs' data
  • China Food and Nutrition Development Outline (2025-2030) issued by the Ministry of Agriculture and Rural Affairs, the National Health Commission, and the Ministry of Industry and Information Technology