US dairy exports’ growth prevailed in October

December 20, 2021

1 mins read

In October, the US milk solid equivalents exports stood at almost 199,000 tonnes, marginally up by 0.6% month-on-month and higher by 1.2% year-on-year (y-o-y), maintaining the upward trend that began in February 2021. Consequently, the total US milk solid exports experienced a substantial year-to-date growth of 11.1% against the same period last year, equating to more than 206,000 tonnes. 2021 US dairy exports have already surpassed the total 2019 calendar year exports, and if this pace continues during the remainder of the year, the total 2021 US dairy exports will hit record-high numbers.

Both China and Mexico were the main growth contributors for US dairy exports during the first ten months of 2021, up 41.5% and 16.5% y-o-y respectively, with combined exports to these markets representing 40% of total US dairy exports. The most noticeable jump was in the Chinese market, where US imports ramped up by 142% against the same period in 2019. Whey sales into China fuelled this growth in terms of volume, and categories such as skimmed milk powder (SMP) and butter saw their volumes multiply by double digits, albeit from a far lower 2019 base volume.

Despite backlogs in US west coast ports and surging freight costs, US dairy sales have been consolidating in 2021, gaining global market share. There are several reasons for this success. In terms of supply, US milk collection has been plentiful this spring flush period, with increasing investment in production capacity from US milk processors, leading to competitive dairy prices against the main direct competitors, particularly New Zealand and the EU. For instance, the Mintec price for US SMP was USD 400/MT lower than New Zealand counterparts and USD 100/MT against the EU SMP over the last year. Furthermore, the EU experienced low milk supplies during this spring flush, which brought milk collection to a steady level between January and October, constraining milk solid equivalents production, and consequently limiting available export supplies. Additionally in terms of demand, strong Chinese demand and the recovery of demand in Mexico, a neighbouring market and a key trade partner, have supported US dairy sales.

 

 

 

 

 

Topics: Dairy & Eggs
Jose Saiz
Jose Saiz

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