Mongolia Pushes for Modernization in Dairy Industry

According to the Office of the President of Mongolia, to strengthen the country’s “Food Supply and Security” initiative, the government is actively revising and improving relevant industry laws. The aim is to support local enterprises through preferential loans and tax policy incentives. Specifically, in the dairy industry, the government has decided to provide a subsidy of 1,000 Tugriks per liter of industrially processed milk to encourage modernization and intensification.

Experts and analysts widely believe that to meet the growing domestic demand for dairy products and prevent the outflow of valuable foreign exchange resources, the government must significantly invest in high-yield livestock farming. Under the “Food Supply and Security” initiative, introducing new technologies and processes and expanding corporate production capacities are key to achieving modernization and intensive production in the dairy sector.

The report further highlights that Mongolia currently has approximately 206 factories specializing in milk and dairy processing, along with 77 workshops and cold storage centers, providing employment to around 1,700 people. On the demand side, the domestic production-to-import ratio in the dairy market is roughly 51% to 49%.

In terms of liquid milk production, domestic production fully meets the total domestic market demand. Under the “Food Supply and Security” framework, the number of households and enterprises eligible for raw milk production subsidies has been steadily increasing year by year, from 8 factories in 2020-2021 to 12 in 2021-2022, then to 15 in 2022-2023. The figure is expected to rise to 24 in 2023-2024 and 32 by 2024-2025.

At the same time, the supply of raw milk has shown significant growth, from 6.8 million liters in 2020 to an estimated 29.1 million liters by 2024.