U.S. Dairy Exports Update – Sep ’19
Executive Summary
U.S. dairy export figures provided by USDA were recently updated with values spanning through Jul ’19. Highlights from the updated report include:
Butterfat export volumes destined to Mexico, Canada and the EU-28 declined most significantly on a YOY basis throughout the month, while export volumes destined to Columbia finished most significantly higher.
Mexican imports of U.S. butterfat have remained strong throughout the past 12 months, increasing by 30.6% on a YOY basis, however butterfat export volumes destined to all other countries have declined by 22.0% YOY throughout the same period. Mexico and Canada have combined to account for just under two thirds of the total U.S. butterfat export volumes experienced throughout the past 12 months.
Cheese – Export Volumes Increase to a Five Year Seasonal High Level, Finish up 0.7% YOY
Jul ’19 U.S. cheese export volumes increased on a YOY basis for sixth time in the past eight months, finishing up 0.7% to a five year seasonal high level. Other-than-cheddar cheese export volumes increased 1.5% YOY throughout the month, more than offsetting a 4.3% YOY decline in cheddar cheese export volumes experienced throughout the month. ’17-’18 annual cheese export volumes finished up 4.1% YOY to a four year high, despite declining by 4.9% on a YOY basis over the final quarter of the production season. ’18-’19 YTD cheese export volumes have increased an additional 2.3% YOY throughout the first ten months of the production season.
Jul ’19 YOY increases in cheese export volumes were led by product destined to Mexico, while volumes destined to South Korea finished most significantly lower on a YOY basis throughout the month.
Mexico and South Korea have historically been the largest importers of U.S. cheese, accounting for 45% of total U.S. cheese export volumes throughout the past five years. Combined U.S. cheese export volumes destined to Mexico and South Korea have declined 0.2% on a YOY basis throughout the past 12 months, however.
Whey – Total Export Volumes Remain Lower YOY on Weak Chinese Demand
Jul ’19 U.S. dry whey export volumes remained lower on a YOY basis for the 11th consecutive month, declining by 27.9% to a 15 year seasonal low level. ’17-’18 annual dry whey export volumes finished up 12.3% YOY to a four year high, despite declining by 3.0% on a YOY basis over the final quarter of the production season. ’18-’19 YTD dry whey export volumes have declined 30.0% YOY throughout the first ten months of the production season, however.
Jul ’19 whey protein concentrate (WPC) export volumes finished lower on a YOY basis for the ninth time in the past ten months, declining by 3.0% to a four year seasonal low level. ’17-’18 annual WPC export volumes finished up 17.4% YOY, reaching a record annual high level for the third consecutive year, despite declining by 4.7% on a YOY basis over the final quarter of the production season. ’18-’19 YTD WPC export volumes have declined 31.5% YOY throughout the first ten months of the production season, however, and are on pace to reach a four year low level.
U.S. whey export volumes destined to China declined most significantly on a YOY basis throughout the month, finishing down 40.2%. Excluding China, Jul ’19 U.S. whey export volumes increased by 7.7% on a YOY basis. China applied a 25% retaliatory tariff to a wide variety of U.S. dairy products including whey during early Jul ’18 while Chinese whey demand has also been reduced on weaker feed demand due to African swine fever.
China has historically been the largest importer of U.S. whey products, accounting for nearly 40% of total U.S. whey export volumes throughout the past five years. U.S. whey export volumes destined to China have declined 51.6% YOY throughout the past 12 months, more than offsetting a 3.3% YOY increase in whey export volumes destined to all other countries.
NFDM/SMP – Export Volumes Decline YOY for the Ninth Consecutive Month, Finish Down 9.0%
Jul ’19 U.S. export volumes of nonfat dry milk (NFDM) and skim milk powder (SMP) rebounded from the 21 month low level experienced throughout the previous month but remained lower on a YOY basis for the ninth consecutive month, finishing down 9.0%. ’17-’18 annual NFDM/SMP exports finished up 16.4% YOY, reaching a record annual high level for the second consecutive year, however ’18-’19 YTD NFDM/SMP export volumes have declined by 11.5% YOY throughout the first ten months of the production season.
Jul ’19 YOY declines in NFDM/SMP export volumes were led by product destined to the Philippines, Indonesia and New Zealand, while export volumes destined to Mexico and Columbia finished most significantly higher on a YOY basis throughout the month.
Mexico has historically been the largest importer of U.S. NFDM/SMP, accounting for nearly half of all U.S. NFDM/SMP export volumes throughout the past five years. U.S. NFDM/SMP export volumes destined to Mexico have increased 12.1% YOY throughout the past 12 months however export volumes destined to all other countries have declined by 20.7% on a YOY basis over the same period.
Export Volumes Normalized to Production
U.S. butterfat, dry whey and NFDM/SMP export volumes as a percentage of production finished below previous year figures during Jul ’19 while cheese export volumes as a percentage of production finished flat with the previous year figure.
Overall, U.S. dairy export volumes were estimated to be equivalent to approximately 13.5% of total U.S. milk-solids production during Jul ’19 while dairy import volumes were estimated to be equivalent to approximately 4.3% of total U.S. milk-solids production. Jul ’19 net dairy trade finished 19.7% lower YOY, declining for the ninth consecutive month.
Jul ’19 U.S. dairy exports as a percentage of milk-solids production remained lower on a YOY basis for the ninth consecutive month, finishing down 10.0%. ’17-’18 annual dairy exports as a percentage of milk-solids production finished at a record high value of 16.3%, however ’18-’19 YTD figures have declined 13.3% YOY throughout the first ten months of the production season.
Jul ’19 U.S. dairy imports as a percentage of milk-solids production finished higher on a YOY basis for the tenth consecutive month, finishing up 21.9%. ’17-’18 annual dairy imports as a percentage of milk-solids production finished at a four year low value of 3.3%, however ’18-’19 YTD figures have rebounded by 12.8% YOY throughout the first ten months of the production season.
Net trade of U.S. NFDM/SMP continued to outpace that of butter, cheese and dry whey as import volumes remain minimal. Net cheese trade volumes continued to exceed net dry whey trade volumes throughout the month while the U.S. finished as a net importer of butter for the 15th consecutive month.
- Jul ’19 U.S. butterfat export volumes declined on a YOY basis for the fifth consecutive month, finishing down 68.9% to a ten year seasonal low level, however Jul ’19 U.S. cheese export volumes increased 0.7% on a YOY basis throughout the month, reaching a five year seasonal high level.
- Jul ’19 U.S. dry whey and whey protein concentrate export volumes finished lower on a YOY basis on weak Chinese demand, declining by 27.9% and 3.0%, respectively. U.S. whey export volumes destined to China declining by 40.2% on a YOY basis throughout Jul ’19, more than offsetting a 7.7% YOY increase in whey export volumes destined to all other countries. Jul ’19 U.S. nonfat dry milk/skim milk powder export volumes declined on a YOY basis for the ninth consecutive month, finishing down 9.0%.
- Net dairy trade on a percentage of total U.S. milk-solids production basis declined YOY for the ninth consecutive month during Jul ’19, finishing down 19.7%. Export volumes on a percentage of milk-solids production basis remained lower on a YOY basis for the ninth consecutive month, finishing down 10.0%, while import volumes remained higher on a percentage of milk-solids production basis for the tenth consecutive month, finishing up 21.9%.
Butterfat export volumes destined to Mexico, Canada and the EU-28 declined most significantly on a YOY basis throughout the month, while export volumes destined to Columbia finished most significantly higher.
Mexican imports of U.S. butterfat have remained strong throughout the past 12 months, increasing by 30.6% on a YOY basis, however butterfat export volumes destined to all other countries have declined by 22.0% YOY throughout the same period. Mexico and Canada have combined to account for just under two thirds of the total U.S. butterfat export volumes experienced throughout the past 12 months.
Cheese – Export Volumes Increase to a Five Year Seasonal High Level, Finish up 0.7% YOY
Jul ’19 U.S. cheese export volumes increased on a YOY basis for sixth time in the past eight months, finishing up 0.7% to a five year seasonal high level. Other-than-cheddar cheese export volumes increased 1.5% YOY throughout the month, more than offsetting a 4.3% YOY decline in cheddar cheese export volumes experienced throughout the month. ’17-’18 annual cheese export volumes finished up 4.1% YOY to a four year high, despite declining by 4.9% on a YOY basis over the final quarter of the production season. ’18-’19 YTD cheese export volumes have increased an additional 2.3% YOY throughout the first ten months of the production season.
Jul ’19 YOY increases in cheese export volumes were led by product destined to Mexico, while volumes destined to South Korea finished most significantly lower on a YOY basis throughout the month.
Mexico and South Korea have historically been the largest importers of U.S. cheese, accounting for 45% of total U.S. cheese export volumes throughout the past five years. Combined U.S. cheese export volumes destined to Mexico and South Korea have declined 0.2% on a YOY basis throughout the past 12 months, however.
Whey – Total Export Volumes Remain Lower YOY on Weak Chinese Demand
Jul ’19 U.S. dry whey export volumes remained lower on a YOY basis for the 11th consecutive month, declining by 27.9% to a 15 year seasonal low level. ’17-’18 annual dry whey export volumes finished up 12.3% YOY to a four year high, despite declining by 3.0% on a YOY basis over the final quarter of the production season. ’18-’19 YTD dry whey export volumes have declined 30.0% YOY throughout the first ten months of the production season, however.
Jul ’19 whey protein concentrate (WPC) export volumes finished lower on a YOY basis for the ninth time in the past ten months, declining by 3.0% to a four year seasonal low level. ’17-’18 annual WPC export volumes finished up 17.4% YOY, reaching a record annual high level for the third consecutive year, despite declining by 4.7% on a YOY basis over the final quarter of the production season. ’18-’19 YTD WPC export volumes have declined 31.5% YOY throughout the first ten months of the production season, however, and are on pace to reach a four year low level.
U.S. whey export volumes destined to China declined most significantly on a YOY basis throughout the month, finishing down 40.2%. Excluding China, Jul ’19 U.S. whey export volumes increased by 7.7% on a YOY basis. China applied a 25% retaliatory tariff to a wide variety of U.S. dairy products including whey during early Jul ’18 while Chinese whey demand has also been reduced on weaker feed demand due to African swine fever.
China has historically been the largest importer of U.S. whey products, accounting for nearly 40% of total U.S. whey export volumes throughout the past five years. U.S. whey export volumes destined to China have declined 51.6% YOY throughout the past 12 months, more than offsetting a 3.3% YOY increase in whey export volumes destined to all other countries.
NFDM/SMP – Export Volumes Decline YOY for the Ninth Consecutive Month, Finish Down 9.0%
Jul ’19 U.S. export volumes of nonfat dry milk (NFDM) and skim milk powder (SMP) rebounded from the 21 month low level experienced throughout the previous month but remained lower on a YOY basis for the ninth consecutive month, finishing down 9.0%. ’17-’18 annual NFDM/SMP exports finished up 16.4% YOY, reaching a record annual high level for the second consecutive year, however ’18-’19 YTD NFDM/SMP export volumes have declined by 11.5% YOY throughout the first ten months of the production season.
Jul ’19 YOY declines in NFDM/SMP export volumes were led by product destined to the Philippines, Indonesia and New Zealand, while export volumes destined to Mexico and Columbia finished most significantly higher on a YOY basis throughout the month.
Mexico has historically been the largest importer of U.S. NFDM/SMP, accounting for nearly half of all U.S. NFDM/SMP export volumes throughout the past five years. U.S. NFDM/SMP export volumes destined to Mexico have increased 12.1% YOY throughout the past 12 months however export volumes destined to all other countries have declined by 20.7% on a YOY basis over the same period.
Export Volumes Normalized to Production
U.S. butterfat, dry whey and NFDM/SMP export volumes as a percentage of production finished below previous year figures during Jul ’19 while cheese export volumes as a percentage of production finished flat with the previous year figure.
Overall, U.S. dairy export volumes were estimated to be equivalent to approximately 13.5% of total U.S. milk-solids production during Jul ’19 while dairy import volumes were estimated to be equivalent to approximately 4.3% of total U.S. milk-solids production. Jul ’19 net dairy trade finished 19.7% lower YOY, declining for the ninth consecutive month.
Jul ’19 U.S. dairy exports as a percentage of milk-solids production remained lower on a YOY basis for the ninth consecutive month, finishing down 10.0%. ’17-’18 annual dairy exports as a percentage of milk-solids production finished at a record high value of 16.3%, however ’18-’19 YTD figures have declined 13.3% YOY throughout the first ten months of the production season.
Jul ’19 U.S. dairy imports as a percentage of milk-solids production finished higher on a YOY basis for the tenth consecutive month, finishing up 21.9%. ’17-’18 annual dairy imports as a percentage of milk-solids production finished at a four year low value of 3.3%, however ’18-’19 YTD figures have rebounded by 12.8% YOY throughout the first ten months of the production season.
Net trade of U.S. NFDM/SMP continued to outpace that of butter, cheese and dry whey as import volumes remain minimal. Net cheese trade volumes continued to exceed net dry whey trade volumes throughout the month while the U.S. finished as a net importer of butter for the 15th consecutive month.