Brazilian municipality more than doubles milk output in a decade as producer income rises and productivity improves
Frederico Westphalen in Rio Grande do Sul, Brazil, achieved a record level of milk production in 2025 despite having around half the number of dairy producers compared with a decade earlier. The municipality has also climbed to fourth place among the region’s leading milk-producing areas.
The turnaround follows a coordinated effort involving dairy farmers, Emater, credit cooperatives, public authorities and other organisations. The initiative was launched when local milk production was declining and farmers were facing unattractive prices.
Over the past decade, Frederico Westphalen more than doubled its milk production, while the number of producers fell significantly. In 2015, the municipality was outside the region’s top 10 milk-producing areas, but by 2025 it had moved into fourth place, with the potential to reach third position.
The growth in production has also translated into substantially higher income for local dairy farmers. Producer gross income reached 58.3 million reais in 2025, adjusted for inflation, compared with approximately 19 million reais in 2015. This represents real growth of about 306% over the decade.
The increased dairy activity is also supporting the wider local economy. According to estimates cited in the report, dairy-related income could generate more than 150 million reais in broader economic circulation, benefiting retail, services, agricultural machinery, farm-input suppliers and transportation businesses.
Frederico Westphalen’s performance contrasts with the wider trend in Rio Grande do Sul, where total milk production declined by 12.5% during the same period. The municipality’s growth demonstrates the potential impact of higher productivity, larger-scale operations and coordinated technical support.
The local dairy sector nevertheless continues to face challenges, including labour shortages and rising production costs. With margins becoming tighter, farmers are increasingly focusing on scale, productivity and efficiency to maintain the viability of their operations.
The experience of Frederico Westphalen highlights how collaboration between farmers, financial institutions, technical organisations and public authorities can help strengthen dairy production, improve farm incomes and create wider economic benefits for rural communities.